The Centers for Medicare & Medicaid Services is taking steps to increase the rates paid to a class of hospitals that often treat patients with complex conditions over a long period of time.
On Tuesday, the CMS issued a proposed payment rule designed to ensure that long-term care hospitals get appropriate payment for services while giving them incentives to provide more efficient care to Medicare beneficiaries.
Federal payments to these hospitals would increase by an average of 2.6 percent, which includes a 0.9 percent adjustment "to offset coding changes in (rate year) 2006 that do not reflect real changes in the severity of the cases treated by these hospitals," the CMS said. The agency is proposing the new rates for a 15-month period, beginning July 1 and lasting until Sept. 30, 2009.
Comments on the proposed rule are due by March 24, and the CMS said it expects to issue a final rule later in the spring.
CMS officials said the new policies and payment rates would apply for patients who are discharged from long-term care hospitals after July 1. The agency estimated that aggregated payments to long-term care hospitals for the year beginning July 1 will total $4.44 billion.
CMS officials said there are about 400 long-term care hospitals in the country that generally treat patients with hospitalizations that last longer than 25 days, typically providing extended medical and rehabilitative care for patients with clinically complex conditions These hospitals often treat patients who are dependent on ventilators or those needing extensive pain management care.
Since 2002, the facilities have been paid under a system that sets payments prospectively, except in cases involving unusually high costs, called outliers. Medicare patients' care is sorted into one of several Medicare Severity Long-Term Care diagnosis-related groups (MS-LTC-DRGs). Payments cover facilities' costs but do not include payment for care provided by physicians or other clinicians - they bill Medicare separately.
The rule announced Tuesday seeks a standard federal rate of $39,076 for the 2009 rate year. The 0.9 percent adjustment is subtracted from a 3.5 percent update that facilities otherwise would have received to keep up with the hospital marketbasket, a measure of inflation in the costs of goods and services used to provide inpatient care.
Also in the rule, the CMS is proposing that annual updates become effective Oct. 1, instead of July 1. Such a change would consolidate rate changes with updates to any MS-LTC-DRGs.