CMS Annouces Rate Increase for Inpatient Stays in Acute Care Hospitals

Centers for Medicare & Medicaid (CMS) has announced that "acute care hospitals that report selected quality data will receive a 3.7 percent increase in payment rates for inpatient services under a final rule issued today by the Centers for Medicare & Medicaid Services (CMS)."



Also, the final rule reduces the outlier threshold to $23,600 from $25,800 in 2005, which will impact hospital's calculation of what extra payments might be warranted when the costs exceed the Diagnosis Related Groups (DRG) payment.



The CMS press release also states that the final rule will contain "important changes to the Diagnosis Related Groups (DRGs) which serve as the basis for the payment rates under IPPS, particularly improvements in accuracy of cardiac DRGs; revision of the postacute care transfer policy; changes to provisions affecting Critical Access Hospitals (CAHs); and revised policies for direct and indirect graduate medical education (GME).



The final rule will appear in the August 12, 2005 Federal Register. The new policies and payment rates will become effective October 1, 2005.