Hospitals would receive a 2.4% rate increase for inpatient services in fiscal year 2027 under a proposal announced by the Centers for Medicare & Medicaid Services on Friday.
If enacted, it would represent an approximately $1.4 billion increase. CMS also projects that additional payments for inpatient cases involving new technologies will rise by $464 million during the same period. The proposed increase is in line with the agency’s recommendation for the current physical year, according to an agency news release.
Several industry groups, squeezed by rising costs and cuts to Medicaid, said the proposed increase is insufficient. The pay hike is “another inadequate update to inpatient payment rates, another extremely high productivity cut and reductions to disproportionate share payments in the face of rising need for care and higher uninsured rates,” Ashley Thompson, senior vice president of public policy analysis and development at the American Hospital Association, told Fierce Healthcare.
The proposed pay increase “is a step in the right direction, but it does not negate the compounding effects of rising inflation, record levels of uncompensated care and a growing uninsured population,” Charlene MacDonald, president and CEO of the Federation of American Hospitals, said in a statement.
Among other highlights of the proposed rule:
- CMS plans to expand the Comprehensive Care for Joint Replacement Model into a mandatory, nationwide program called CJR-X, set to begin on Oct. 1, 2027. Most hospitals would be required to take financial accountability for hip, knee and ankle replacements, including surgery and first 90 days of recovery.
- The agency plans to modify five mortality measures — heart attack, heart failure, pneumonia, COPD and coronary artery bypass graft surgery — beginning with the 2028 payment determination. The proposal also would add Medicare Advantage patients and shorten the performance period from three years to two years.
- CMS proposes adding a 30-day, all-cause, risk-standardized readmission rate following sepsis hospitalization measure to the hospital readmissions reduction program, beginning in 2029. The program reduces payments to hospitals with excessive readmissions and attempts to support improvement in the quality of care.
- Several changes are proposed to the interoperability program, which encourages hospitals to adopt and demonstrate meaningful use of electronic health record technology.
- CMS proposes requiring that approved medical residency training programs not discriminate, or promote or encourage discrimination on the basis of race, color, national origin, sex, age, disability or religion. Similar requirements would apply to approved nursing and allied health education programs and their accreditors.