Overview of CMS final rules is provided by the author

So this is the season for 2019 Medicare facility payment rules. These rules are required each year to update payment rates and processes, as well as additional policies for the next fiscal year, which begins on Oct. 1. These are all final rules; we have previously noted the publication of the proposed rules on these topics. The final rules are based on the proposed rules, modified by public comments to which the Centers for Medicare & Medicaid Services(CMS) agrees.

The rules are for:

  1. Inpatient and Long-Term Care Hospitals (LTCHs)
  2. Skilled Nursing Facilities (SNFs)
  3. Inpatient Psychiatric Facilities (IPFs)
  4. Hospices
  5. Inpatient Rehabilitation Facilities (IRFs)

This includes the new payment rates and revised quality measures for each facility type. These are all available for downloading and review, with condensed fact sheets available at the CMS website.

Each of these rules follows the U.S. Department of Health and Human Services (HHS)/CMS “Meaningful Measures” and “Patients over Paperwork” initiatives to focus on more outcome-based measures, reduce the burden on providers, and make the system more transparent to patients. They also focus on promoting interoperability among electronic health records (EHRs). Some highlights on each rule:

IPPS/LTC includes:

  • An EHR reporting period of a minimum of any continuous 90-day period in each of calendar years (CYs) 2019 and 2020
  • Scoring with a smaller set of objectives that will provide a more flexible, less burdensome structure, allowing eligible hospitals and Critical Access Hospitals (CAHs) to place their focus back on patients
  • Two new e-Prescribing measures related to e-prescribing of opioids
  • The removal of certain measures that do not emphasize interoperability and the electronic exchange of health information
  • A requirement to use the 2015 edition of CEHRT.
  • A requirement for hospitals to make public a list of their standard charges via the Internet in a machine-readable format, and to update this information at least annually, or more often, as appropriate

Specifically, this final rule will remove a total of 18 measures from CMS quality programs and will de-duplicate another 25 measures, leaving those measures that best correlate with patient care.

CMS is reducing burden on providers by easing documentation requirements and providing flexibility in several areas while maintaining important patient and program integrity protections.

It is also expected to result in an increase of approximately 1.85 percent in operating payment rates for general acute-care hospitals paid under the Inpatient Prospective Payment System (IPPS) that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful EHR users, and it will update the LTCH PPS standard federal payment rate by 1.35 percent.

The SNF rule:

  • Spells out that CMS will be using a new case-mix model, the Patient-Driven Payment Model, which focuses on the patient’s condition and resulting care needs rather than on the amount of care provided in order to determine Medicare payment.
  • Focuses on clinically relevant factors, rather than volume-based service, for determining Medicare payments by using ICD-10 diagnosis codes and other patient characteristics as the basis for patient classification. This eliminates the need to document (for billing purposes) each individual service provided.
  • Keeps quality measures the same.
  • CMS estimates that the 2019 aggregate impact will be an increase of $820 million in Medicare payments to SNFs, resulting from the 2019 SNF market basket update required to be 2.4 percent by the Bipartisan Budget Act of 2018.


  • CMS estimates IPF payments to increase by 1.10 percent, or $50 million, in 2019.
  • There will be the removal of five IPFQR Program measures, beginning with the FY 2020 payment determination and continuing in subsequent years. Three other measures that were originally proposed for removal (Physical Restraint Use, Seclusion Use, and Tobacco Use Treatment at Discharge) are being retained in the program as a result of overwhelming public comment that emphasized their importance for patient safety and health issues specific to the patient population (this highlights the importance of public comment).


  • Hospices will see a 1.8 percent ($340 million) increase in their payments for FY 2019.
  • The final rule will finalize a measure removal factor that takes into consideration whether the costs and burden associated with a measure outweigh the benefit of its continued use in the program.
  • This final rule also provides several updates to the quality reporting program for hospices to improve transparency for patients.


  • To reduce regulatory burden on rehabilitation providers and physicians, this final rule revises the following IRF coverage criteria, as suggested by some of the comments received in response to the RFI in the FY 2018 IRF IPPS proposed rule:
    • Allow the post-admission physician evaluation to count as one of the face-to-face physician visits.
    • Allow the rehabilitation physician to lead the interdisciplinary team meeting remotely, without any additional documentation requirements.
    • Remove the admission order documentation requirement in an effort to reduce duplicative documentation requirements.
  • It also removes two measures from the IRF QRP measure set. These measures either have significant operational challenges with reporting, or the measured performance among IRFs is so high and unvarying that meaningful distinctions in improvements in performance can be no longer be made.
  • It also updates IRF PPS payments to reflect an estimated 1.35 percent increase factor.

The physician payment rule and Merit-based Incentive Payment System (MIPS) update rules are still available for public comment until Sept. 10.

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Stanley Nachimson, MS

Stanley Nachimson, MS is principal of Nachimson Advisors, a health IT consulting firm dedicated to finding innovative uses for health information technology and encouraging its adoption. The firm serves a number of clients, including WEDI, EHNAC, the Cooperative Exchange, the Association of American Medical Colleges, and No World Borders. Stanley is focusing on assisting health care providers and plans with their ICD-10 implementation and is the director of the NCHICA-WEDI Timeline Initiative. He serves on the Board of Advisors for QualEDIx Corporation. Stanley served for over 30 years in the US Department of Health and Human Services in a variety of statistical, management, and health technology positions. His last ten years prior to his 2007 retirement were spent in developing HIPAA policy, regulations, and implementation planning and monitoring, beginning CMS’s work on Personal Health Records and serving as the CMS liaison with several industry organizations, including WEDI and HITSP. He brings a wealth of experience and information regarding the use of standards and technology in the health care industry.

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