CMS Releases FY 2022 Proposed Rule for Inpatient Rehabilitation Facilities

Proposed rule solicits comments on closing the health equity gap.

The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule for Inpatient Rehabilitation Facilities (IRFs) that would update payment policies for FY 2022, update IRF Quality Reporting Program (QRP) requirements for FY 2022, address Public Reporting of Quality Requirements and that seeks input on closing the Health Equity Gap and on Fast Healthcare Interoperability Resources (FHIR).  While the impact for the coming year is what we expected, there are significant implications for the coming years. The proposed rule was released April 7.

Major takeaways include the following:

Increase in Standard Payment Rate:
Following standard methodology, CMS has recommended updates to the IRF payment rates providing for a net increase in payments of 1.8 percent – $160 million as compared to FY 2021.  This increase is based on an update to the IRF PPS payment rates by 2.2 percent based on the proposed IRF market basket update of 2.4 percent, less a 0.2 percentage point multi-factor productivity (MFP) adjustment. This brings the Proposed FY 2022 Standard Payment Conversion Factor to $17,273 as compared to $16,856 for FY 2021.

Outlier Threshold:
The proposed rule also includes an adjustment to the outlier threshold to maintain outlier payments at 3.0 percent in FY 2022. The adjustment would result in a 0.3 percentage point decrease to overall outlier payments.

Proposed New Measure:  COVID-19 Vaccinations among Healthcare Personnel:
In efforts to address COVID-19 and assess whether organizations are taking steps to limit the spread of COVID-19 among their Healthcare Personnel (HCP), CMS has proposed a measure to require IRFs to report COVID-19 HCP Vaccinations. 

Of note, the data would be reported through the National Healthcare Safety Network (NHSN) Healthcare Personnel Safety (HPS) component – not on the IRF-PAI.  IRFs would submit data for a minimum of one week per month.  CDC would calculate a quarterly summary from the three-monthly modules and follow a standardized refresh policy for reporting on the Care Compare website.  For purposes of submitting data to CMS for the FY 2023 IRF QRP, IRFs would be required to begin data submission on Oct. 1, 2021.

Changes to the TOH Information to the Patient PAC Quality Measure:
The proposed rule would also update the denominator for the Transfer of Health (TOH) Information to the Patient-Post Acute Care (PAC) quality measure by excluding patients discharge home under the care of an organized home health service or hospice from the denominator.  This is proposed in order to limit the duplication of patient data across PAC settings.

Future Quality Measures Under Consideration:
While additional measures under consideration will not impact FY 2022, CMS is signaling future increased requirements for data collection related to health equity and other social and behavioral determinants of health including frailty, opioid use and frequency, patient reported outcomes, shared decision-making process, appropriate pain assessment and pain management processes and health equity.  CMS is requesting input on the importance, relevance, appropriateness, and applicability of these measures for the future.

Public Reporting of Quality Measures – Website Refreshes:
The proposed rule discusses the current data available on Care Compare and proposes updates to the refresh schedule to bring the data available  into alignment with more recent data collected.

Fast Healthcare Interoperability Resources (FHIR):
As part of the Meaningful Measures Framework launched in October 2017, CMS included emphasis on digital quality measurement (dQM) to reduce measurement burden in response to a need to streamline data collection, calculation, and reporting.  In the proposed rule, CMS in seeking feedback on plans to define Digital Quality Measures (dQMs) for the IRF QRP.  CMS proposes the following definition: “Digital Quality Measures (dQMs) are quality measures that use one or more sources of health information that are captured and can be transmitted electronically via interoperable systems”.

Additionally, CMS is considering the use of Fast Healthcare Interoperability Resources (FHIR)-based standards to exchange clinical information through application programming interfaces (APIs) which automates the use of data in multiple ways.

CMS has included a specific solicitation for comments in this area.

Closing the Health Equity Gap
CMS notes that consistent with Executive Order 13985 on Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, the agency is committed to addressing the significant and persistent inequities in health outcomes in the United States through improving data collection to better measure and analyze disparities across programs and policies.

CMS intends to make healthcare quality more transparent to consumers and providers, enabling them to make better choices as well as promoting provider accountability around health equity. Toward that end,  CMS is seeking feedback in this from IRFs on ways to attain health equity for all patients through policy solutions.

Currently, CMS has adopted several standardized patient assessment data elements (SPADEs) which include several social determinants of health (SDOH) that were finalized in the FY 2020 IRF PPS final rule. In this proposed rule, CMS is also seeking comment on the possibility of expanding measure development and the collection of other SPADEs that address gaps in health equity in the IRF QRP.

Industry response is essential related to the key requests for information outlined by CMS in the proposed rule.  Comments must be received by 5 pm on June 7, 2021 and submitted either electronically or by mail.

Review the proposed rule here:  Federal Register :: Public Inspection: Medicare Program: Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2022 and Updates to the IRF Quality Reporting Program

Review the CMS fact sheet here:  Fiscal Year (FY) 2022 Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) Proposed Rule (CMS-1748-P) | CMS


Angela Phillips, PT

Angela M. Phillips, PT, is President & Chief Executive Officer of Images & Associates. A graduate of the University of Pennsylvania, School of Allied Health Professions, she has almost 45 years of experience as a consultant, healthcare executive, hospital administrator, educator, and clinician. Ms. Phillips is one of the nation’s leading consultants assisting Inpatient Rehabilitation Facilities in operating effectively under the Medicare Prospective Payment System (PPS) and in addressing key issues related to compliance.

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