CMS has issued a proposed rule that would result in a net increase of 2.6% to the Medicare inpatient prospective payment system rate for fiscal year 2025, a raise that hospital trade groups say doesn’t go far enough.
The rule would apply to hospitals that are meaningful users of electronic health records and submit quality measure data, and reflects a hospital market basket increase of 3 percent with a productivity cut of 0.4%. Overall, it would increase hospital payments by $2.9 billion. Additionally, the rule would continue the low wage index hospital policy for another year and establish separate payment systems for maintaining access to essential medicines. There’s also a proposed $94 million increase in new medical technology payments.
The proposal was criticized by hospital advocates like Ashley Thompson, American Hospital Association senior vice president for public policy analysis and development, who says the payment updates are “woefully inadequate.”
“Many hospitals across the country, especially those in rural and underserved communities, continue to operate under unsustainable negative or break-even margins,” Thompson says in a statement. “We urge CMS to reconsider their policy in the final rule so that all hospitals can provide high-quality, around the clock, essential care to their communities.
Thompson also notes the rule increases the long-term care hospital outlier threshold to $31,048, further exacerbating the financial loss absorbed by hospitals who care for such complex patients.
Federation of American Hospitals president and CEO Chip Kahn echoed this frustration in a separate statement. “Just like last year, with inflation still stubbornly high, CMS fails to meet the moment by once again proposing an inadequate payment update that will leave hospitals struggling to meet the needs of patients.”
CMS is accepting comments on the proposed rule through June 10.
Evan joined TriMed in 2011, writing primarily for Health Imaging. Prior to diving into medical journalism, Evan worked for the Nine Network of Public Media in St. Louis. He also has worked in public relations and education. Evan studied journalism at the University of Missouri, with an emphasis on broadcast media.