The Centers for Medicare & Medicaid Services (CMS) has published a proposed rule to update Medicare rates for inpatient rehabilitation facility (IRF) services for fiscal year (FY) 2019. CMS estimates that IRF prospective payment system (PPS) payments would increase by a total of $75 million under the proposed rule compared to FY 2018 levels. Specifically, CMS proposes to update IRF PPS payment rates by 1.35%, which reflects an IRF market basket update of 2.9%, which is reduced by a 0.8 percentage point multifactor productivity adjustment and a statutory 0.75 percentage point reduction. The proposed FY 2019 standard payment conversion factor is $16,020, compared to $15,838 in FY 2018. An IRF that does not submit required quality data to CMS is subject to a 2.0 percentage point decrease in its annual update. The proposed outlier threshold amount would be increased from $8,679 for FY 2018 to $10,509 for FY 2019, which would decrease aggregate payments by approximately 0.4%. CMS also proposes updates to the IRF wage index and case-mix group relative weights in a budget-neutral manner.

In addition, CMS proposes to reduce the regulatory burden for IRFs by: removing the Functional Independence Measure instrument and associated Function Modifiers from the IRF-Patient Assessment Instrument; allowing the post-admission physician evaluation to count as one of the required face-to-face physician visits; allowing the rehabilitation physician to lead the interdisciplinary meeting remotely without any additional documentation requirements; and removing the admission order documentation requirement. Furthermore, CMS requests comments regarding removing the face-to-face requirement for rehabilitation physician visits and expanding the use of nonphysician practitioners in meeting the IRF coverage requirements. CMS also proposes to update the requirements for the IRF Quality Reporting Program, including adding a new quality measure removal factor and removing two measures from the measure set.

Consistent with other proposed FY 2019 payment rules, CMS includes a Request for Information (RFI) seeking input on ways to promote interoperability and electronic healthcare information exchange, including through possible new or revised conditions of participation. CMS will accept comments on the proposed rule and RFI through June 26, 2018.