August 2, 2022 – On Monday, CMS issued the fiscal year (FY) 2023 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital Prospective Payment System (LTCH PPS) final rule.
The increase in operating payment rates for general acute care hospitals paid under the IPPS, that successfully participate in the Hospital IQR Program and are meaningful electronic health record (EHR) users, is 4.3%.
“This reflects a FY 2023 hospital market basket update of 4.1% reduced by a 0.3 percentage point productivity adjustment and increased by a 0.5 percentage point adjustment required by statute,” CMS said in a release. “This update reflects the most recent data available, including a revised outlook regarding the U.S. economy and, as a result, is 1.1 percentage point higher than the proposed update for FY 2023.”
For FY 2023, CMS expects LTCH PPS payments to increase by approximately $71 million. LTCH PPS payments for FY 2023, for discharges paid the LTCH standard payment rate, are expected to increase by approximately 2.3% due primarily to the annual standard federal rate update (that is, the productivity-adjusted market basket increase) for FY 2023 of 3.8% and a projected decrease in high-cost outlier payments.