CMS has published final payment rules for hospices and inpatient rehabilitation, psychiatric and skilled nursing facilities for fiscal year 2025.
Sixteen things to know:
1. CMS has finalized a 3% increase in payments for inpatient rehab facilities in 2025.
2. The payment update includes a 3.5% market basket update, which is reduced by a 0.5% productivity adjustment. Additionally, CMS is updating the outlier threshold to maintain outlier payments at 3% of total payments.
3. The final rule will equate to an estimated $280 million increase in IRF payments in 2025, according to CMS.
4. The agency also modified assessment items associated with health-related social needs. Beginning Oct. 1, 2026, inpatient rehab facilities will be required to report specific data related to living situations and food and utilities.
5. In 2025, CMS will increase hospice payments by 2.9%, which would be about a $790 million increase over 2024.
6. The payment increase stems from the 3.4% inpatient hospital market basket increase reduced by a 0.5 percentage point productivity adjustment.
7. The 2025 rates for hospices that do not submit required quality data will be updated by the new hospice payment update percentage of 2.9% minus four percentage points, which results in a -1.1% update.
8. Beginning in 2028, CMS will add two new process measures to the Hospice Quality Reporting Program: Timely Reassessment of Pain Impact and Timely Reassessment of Non-Pain Symptom Impact.
9. CMS has finalized a 4.2% pay increase for SNFs in 2025, based on the proposed SNF market basket of 3%, plus a 1.7% market basket forecast error adjustment and a negative 0.5% productivity adjustment.
10. The above figures do not include value-based purchasing reductions for certain SNFs subject to the net reduction in payments under the VBP program; those adjustments are estimated to total $196.5 million in 2025.
11. The final rule will update the SNF market basket update base year from the current base year of 2018 to a new base year of 2022.
12. The rule also updates the SNF prospective payment system wage index using the core-based statistical areas defined within the new office of management and budget to improve the accuracy of wages and wage-related costs for the area in which the facility is located.
13. CMS has also finalized the addition of four new social determinants of health items and modified one SDOH assessment item for the SNF quality reporting program.
Inpatient psychiatric facilities
14. CMS will increase payments to inpatient psychiatric facilities by 2.8% in 2025, based on the proposed 2021-based market basket increase of 3.3% less a proposed 0.5 percentage point productivity adjustment.
15. The agency also finalized an update to the outlier threshold so that estimated outlier payments remain at 2% of total payments, which would lead to an estimated 0.3% decrease in aggregate payments.
16. Total estimated payments to inpatient psychiatric facilities are expected to increase by 2.5% (about $65 million) in 2025.