CMS Proposes Acute Hospitals Get 3.2% Pay Bump In 2023, Calls For Equity Quality Measures

The Biden administration is proposing that acute care hospitals get a 3.2% increase in payments for federal fiscal 2023 and to install new quality measures focused on health equity.

The Centers for Medicare & Medicaid Services (CMS) released its proposed Inpatient Prospective Payment System (IPPS) rule and a separate rule for long-term care hospitals. The agency is proposing three health equity-focused measures to adopt in the Hospital Inpatient Quality Reporting Program, part of a larger agencywide effort to improve health equity.

“This year—through a health equity lens—we are also re-envisioning the next chapter of healthcare quality and patient safety,” said CMS Administrator Chiquita Brooks-LaSure in a statement.

The inpatient payment rule calls for a 3.2% increase for acute care hospitals paid under the IPPS that participate in the Hospital Inpatient Quality Reporting Program and are meaningful electronic health record users.

“This reflects a [fiscal year] 2023 projected hospital market basket update of 3.1% reduced by a projected 0.4 percentage point productivity adjustment and increased by a 0.5 percentage point adjustment required by statute,” CMS said in a release.

For long-term care hospitals, CMS expects payments will increase by 0.8%.

CMS also proposed several ways to increase health equity, a major priority for the Biden administration. The agency is proposing adding three measures to the Hospital Inpatient Quality Reporting Program.

The first measure would require hospitals to submit data on strategic planning, data analysis and quality improvement on health equity.

“The second and third measures capture screening and identification of patient-level, health-related social needs—such as food insecurity, housing instability, transportation needs, utility difficulties and interpersonal safety,” CMS said in a release.

The agency hopes that by screening for and identifying unmet needs, hospitals will be in a better place to “serve patients holistically by addressing and monitoring what are often key contributors to poor physical and mental health outcomes,” CMS said.

CMS is also asking for public comments on what to prioritize in data collection and reporting.

It hopes to discontinue proxy data for uncompensated care costs in determining such uncompensated care payments to Indian Health Service and tribal hospitals as well as facilities in Puerto Rico. The goal is to create a new supplemental payment to prevent “undue long-term financial disruption for these hospitals,” the agency added.

The agency wants comments as well on social determinants of health, particularly those related to homelessness, reported by hospitals in their Medicare claims.

As part of the rule, CMS is proposing the creation of a new hospital designation to denote “birthing friendly” facilities. Such hospitals must abide by additional quality measure reporting that leads to improvements in maternal health outcomes.

The goal of the designation is to help consumers choose facilities that are committed to maternal health via a series of best practices.

“Improving maternal health outcomes—particularly among underserved communities and groups that we know experience adverse birth outcomes at a higher rate—is a top priority for the Biden-Harris Administration, CMS, and for me personally,” said Brooks-LaSure.


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