The Centers for Medicare & Medicaid Services set new nursing home payment rates for 2009 and issued a final rule to on payment for services for people who need the intensive rehabilitation services provided by Inpatient Rehabilitation Facilities, or IRFs.
The final rule on rehabilitation payments will appear in the August 8 Federal Register and will be effective for fiscal year 2009, beginning Oct. 1, 2008.
Rehabilitation patients are recovering from serious illnesses or injuries, such as stroke, spinal cord injuries, severe burns and amputations. There are currently more than 1,200 facilities that are paid as IRFs.
Medicare payment rates to nursing homes will increase by $780 million next year, CMS officials announced. The change is the result of a 3.4 percent increase in the annual market basket calculation of the cost of goods and services included in a skilled nursing facility stay.
CMS projects that Medicare payments to inpatient rehabilitation facilities under the final rule will be approximately $5.6 billion in fiscal year 2009.
"The payment rates and policies adopted in this final rule will make it possible for beneficiaries who are severely impaired by illness or injury, but who are able to participate in an intensive program of rehabilitation, to obtain high quality care in an inpatient setting," said CMS Acting Administrator Kerry Weems.
Since 2002, Medicare has paid rehabilitation hospitals and rehabilitation units in acute care hospitals for inpatient stays under the IRF prospective payment system. Under this system, patients are classified into case-mix groups, taking into account the patient's physical and cognitive status.
Medicare establishes a weight for each case-mix group based on the average resources required for treating a patient in that group. Medicare makes a single payment to the facility based on a base rate, which is updated annually for inflation. The base rate is further adjusted to account for specific characteristics and the location of the facility.
The payment rates set by the IRF for rehabilitation therapy services are higher than would be paid for services in other settings, such as hospital outpatient departments, skilled nursing facilities or in the home health setting, because these patients have more severe and more complex medical conditions that need more intensive and coordinated rehabilitation services.
The final rule sets the inflation update for the standard federal rate at zero percent for 2009.
"The rule CMS is adopting today will help to ensure that people with Medicare have access to rehabilitation services that are appropriate to their medical conditions, and that will help them reach their maximum level of recovery as quickly as possible," said Weems.