CHA News Article

CMS Finalizes 1.1 Percent Increase to LTCHs in FFY 2015

The Centers for Medicare & Medicaid Services (CMS) has finalized updates to the long-term care hospital (LTCH) prospective payment system for federal fiscal year (FFY) 2015. The final rule, issued late yesterday, increases payments to LTCHs by 1.1 percent, or approximately $62 million, in FFY 2015. The update accounts for the mandatory market basket increase of 2.9 percent, two statutorily mandated cuts totaling 0.7 percent, the final of three installments of the “one-time budget neutrality adjustment” for a decrease of  1.3 percent and an increase for high-cost outlier payments of 0.2 percent. The final rule also implements several LTCH provisions mandated in the Bipartisan Budget Act, including a reinstatement of “25 percent rule” relief and a moratorium on new LTCH beds and facilities.

As advocated by CHA, CMS did not finalize its proposal to modify the policy for interrupted stays for patients temporarily transferred to another setting for services not available in the LTCH, which would have cut LTCH payments by $100 million. CMS also rescinded the interrupted stay policy that would have reduced payments for co-located LTCHs with more than 5 percent of their discharges transferred to the host general acute care hospital and then readmitted to the same LTCHs.

In addition, CMS finalized changes to the LTCH quality reporting program (QRP), including the addition of three quality measures for FFY 2018. CMS also finalized a mandatory reconsideration process for the LTCH QRP, requiring that LTCH providers follow specific procedures when submitting a request for CMS’ reconsideration of an initial LTCH QRP provider compliance determination. The final rule, attached, is effective Oct. 1. CHA will provide a more detailed summary in the coming weeks.