The Centers for Medicare and Medicaid Services (CMS) has released a proposed rule to increase Medicare payments to long-term acute care hospitals (LTCHs) by 2.6% beginning July 1, 2008. Last year, the final rule for LTCH prospective payment system (PPS) lowered Medicare payments by 3.8%, but the Medicare, Medicaid, and SCHIP Extension Act of 2007, signed into law in December, provided a freeze in their payment update for the last quarter of 2008. CMS states that as a result of the provisions in the Medicare extenders bill, it will delay a permanent adjustment to LTCH payments but plans to cut the market basket by 0.9%, which results in the 2.6% increase, rather than a higher, 3.5% update.
The rule also proposes to coordinate all LTCH annual payment changes. In the past, LTCHs have received changes to the market basket in January and to the long-term care Diagnosis Related Groups (DRGs) in April. But the proposed rule would, instead, make all annual payment update changes effective on October 1st. This will require that the 2009 rate be extended for 15 months, from July 1, 2008 through September 30, 2009.
The proposed rule can be viewed on the CMS Web site [PDF]. For further information, please contact Mark Kander, ASHA's Director of Health Care Regulatory Analysis, at mkander@asha.org or by phone at 800-498-2071, ext. 5669.
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