CMS Introduces FY 2020 Inpatient Rule

Changes to Medicare Wage Index proposed

April 30, 2019

On April 23, CMS introduced its proposed FY 2020 Inpatient Prospective Payment System (IPPS) Rule. WHA will analyze the full 1,800-plus page rule in the coming weeks and prepare comments in advance of the June 24 comment deadline. Below are the top areas of note mentioned by CMS.

  • Increases overall IPPS payments by 3.5%, including a market basket increase of 3.2%.
  • New technology add-on payments are increased for breakthrough medical devices from 50% (current rate) to 65% in 2020.
  • Adjustments to Medicare’s quality incentive programs.
    • Addressing disparities in the Medicare Area Wage Index byRaising the wage index for hospitals in the bottom 25% by 0.4% and by lowering the wage index for hospitals in the top 25% by 0.2%.
    • Reducing the number of urban hospitals that benefit from the rural floor by no longer making urban-to-rural reclassifications part of the calculation.

Overall, the proposed rule appears to have several positive changes for hospitals and health systems. WHA staff will take an indepth look at the rule in the coming weeks prior to submitting comments. Contact WHA Director of Federal & State Relations Jon Hoelter with questions or comments.

This story originally appeared in the April 30, 2019 edition of WHA Newsletter