On the evening of April 7th, the Centers for Medicare & Medicaid Services (CMS) released the fiscal year (FY) 2022 proposed rule for inpatient psychiatric facilities (IPFs), which includes proposed policies for payment and quality reporting in these facilities.
Comments on the proposed rule are due on June 7, 2021.
CMS Predicts Increase in IPF Payments for FY 2022
IPFs are paid a daily base rate intended to cover all routine, ancillary, and capital costs. The per-diem payment may be adjusted based on a patient’s Diagnosis-Related Group (DRG) assignment and comorbidities. Payments are also adjusted to reflect higher expenses at the beginning of a patient’s stay and lower expenses towards the end of the stay.
CMS is estimating that aggregate payments to inpatient psychiatric facilities (IPFs) will increase by 2.3 percent in FY 2022, which means an estimated $90 million increase in payments compared to FY 2021. This 2.3 percent increase is the result of a 2.1 percent increase in IPF payment rates (annual market basket update of +2.3 percent and productivity offset of -0.2 percent), and updates to the outlier threshold (+0.2 percent).
| Inpatient Psychiatric Facility Proposed Payment System (IPF PPS) | FY 2021 (Final) | FY 2022 (Proposed) |
| Per-Diem Base Rate | $815.22 | $833.50 |
| Electroconvulsive Therapy Payment (per treatment) | $350.97 | $358.84 |
| Fixed Dollar Loss Threshold | $14,630 | $14,030 |
CMS proposes to make conforming changes to the IPF PPS teaching policy to align with policies for the inpatient prospective payment system (IPPS). The changes will allow for great flexibility for residents to transfer while the IPF residency program is winding down instead of waiting until the last day of operation.
CMS Proposes to Add COVID Vaccination Coverage Among Healthcare Personnel (HCP) Measure and Other Changes to IPF Quality Reporting
IPFs are required to submit quality data to CMS under the IPFQR Program; facilities that do not meet reporting requirements are subject to 2.0 percentage point reduction in payment. Currently, the IPFQR Program includes 14 measures. In this rule, CMS proposes transitioning to patient-level reporting for chart-abstracted measures beginning with voluntary reporting for the FY 2023 payment determination. This would then become mandatory for the FY 2024 payment determination and future years. The agency is proposing this transition because they believe it will improve data accuracy over reporting aggregate measure data without increasing provider burden.
Beginning with the FY 2023 payment determination, CMS proposes to add a quality measure developed by the Centers for Disease Control and Prevention (CDC), COVID-19 Vaccination Coverage Among Healthcare Personnel (HCP). Reporting on this measure would begin in October 2021 if finalized. This measure was also proposed for inclusion in the Inpatient Rehabilitation Facility Quality Reporting Program.
For the FY 2024 payment determination, CMS proposes adding the measure, Follow-up After Psychiatric Hospitalization (FAPH). Also beginning with the FY 2024 payment determination, CMS proposes removing four quality measures in an effort to reduce provider burden.
CMS is seeking feedback on addressing health equity in the IPFQR Program, consistent with the recent Executive Order, Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, recently signed by President Biden. In particular, CMS is looking for comments on ways to improve demographic data collection, the potential creation of a facility equity score, and potential stratification of quality measure results by dual eligibility and other social risk factors. A similar request for feedback was included in the FY 2022 proposed rule for inpatient rehabilitation facilities (IRFs), which was released simultaneous to the proposed IPF rule.