Notification - Medicare Payments to Inpatient Psychiatric Facilities to Increase 1.9 Percent in FY 2013

CMS, August 2, 2011

The Centers for Medicare & Medicaid Services (CMS) today issued a notice that will update payment rates to 467 freestanding inpatient psychiatric facilities (IPFs), and1152 IPF units of acute care hospitals, including a small number of IPF units in critical access hospitals (CAHs) that are paid under the IPF Prospective Payment System (PPS).  The new rates will apply to services furnished to Medicare beneficiaries during fiscal year (FY) 2013, beginning with discharges on or after October 1, 2012.

CMS updates the payment rates under the IPF PPS annually, using a market basket index that reflects changes in the prices of goods and services used to furnish covered care to Medicare beneficiaries in several types of facilities, including IPFs, Inpatient Rehabilitation Facilities, and Long-Term Care Hospitals.  For FY 2013, we are using the FY 2008-based Rehabilitation Psychiatric and Long-Term Care market basket (RPL).  For FY 2013, the RPL market basket estimate is 2.7 percent.  The market basket is reduced by a -0.7 percent multifactor productivity (MFP) adjustment and a 0.1 percentage point reduction, both mandated by the Affordable Care Act.  The net estimated increase to aggregate payments for FY 2013 is 1.9 percent.

CMS is also increasing the outlier threshold amount for FY 2013 to $11,600 from $7,340 in RY 2012 to maintain outlier payments at 2.0 percent of total payments for FY 2013.

CMS estimates the total impact of the FY 2013 payment rate update to be an increase of approximately $36 million.

The notice went on display on August 2, 2012 at the Office of the Federal Register's Public Inspection Desk and will appear in the August 7, 2012 Federal Register.  It can be downloaded here.

For more information, please see: CMS Inpatient Psychiatric Facility PPS.