Proposed Rule2024-07567
Medicare and Medicaid Programs and the Children's Health Insurance Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year 2025 Rates; Quality Programs Requirements; and Other Policy Changes
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
May 2, 2024
Issuing agencies
Health and Human Services DepartmentCenters for Medicare & Medicaid Services
Abstract
This proposed rule would revise the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital- related costs of acute care hospitals; make changes relating to Medicare graduate medical education (GME) for teaching hospitals; update the payment policies and the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs); and make other policy-related changes.
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[Federal Register Volume 89, Number 86 (Thursday, May 2, 2024)]
[Proposed Rules]
[Pages 35934-36649]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-07567]
[[Page 35933]]
Vol. 89
Thursday,
No. 86
May 2, 2024
Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 412, 413, 431, et al.
Medicare and Medicaid Programs and the Children's Health Insurance
Program; Hospital Inpatient Prospective Payment Systems for Acute Care
Hospitals and the Long Term Care Hospital Prospective Payment System
and Policy Changes and Fiscal Year 2025 Rates; Quality Programs
Requirements; and Other Policy Changes; Proposed Rule
Federal Register / Vol. 89, No. 86 / Thursday, May 2, 2024 / Proposed
Rules
[[Page 35934]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 412, 413, 431, 482, 485, 495, and 512
[CMS-1808-P]
RIN 0938-AV34
Medicare and Medicaid Programs and the Children's Health
Insurance Program; Hospital Inpatient Prospective Payment Systems for
Acute Care Hospitals and the Long-Term Care Hospital Prospective
Payment System and Policy Changes and Fiscal Year 2025 Rates; Quality
Programs Requirements; and Other Policy Changes
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Proposed rule.
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SUMMARY: This proposed rule would revise the Medicare hospital
inpatient prospective payment systems (IPPS) for operating and capital-
related costs of acute care hospitals; make changes relating to
Medicare graduate medical education (GME) for teaching hospitals;
update the payment policies and the annual payment rates for the
Medicare prospective payment system (PPS) for inpatient hospital
services provided by long-term care hospitals (LTCHs); and make other
policy-related changes.
DATES: To be assured consideration, comments must be received at one of
the addresses provided in the ADDRESSES section, no later than 5 p.m.
EDT on June 10, 2024.
ADDRESSES: In commenting, please refer to file code CMS-1808-P. Because
of staff and resource limitations, we cannot accept comments by
facsimile (FAX) transmission. Comments, including mass comment
submissions, must be submitted in one of the following three ways
(please choose only one of the ways listed):
1. Electronically. You may (and we encourage you to) submit
electronic comments on this regulation to <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
Follow the instructions under the ``submit a comment'' tab.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-1808-P, P.O. Box 8013,
Baltimore, MD 21244-8013.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments via
express or overnight mail to the following address ONLY: Centers for
Medicare & Medicaid Services, Department of Health and Human Services,
Attention: CMS-1808-P, Mail Stop C4-26-05, 7500 Security Boulevard,
Baltimore, MD 21244-1850.
For information on viewing public comments, we refer readers to the
beginning of the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Donald Thompson, and Michele Hudson,
(410) 786-4487 or <a href="/cdn-cgi/l/email-protection#793d383a391a140a5711110a571e160f"><span class="__cf_email__" data-cfemail="c88c898b88aba5bbe6a0a0bbe6afa7be">[email protected]</span></a>, Operating Prospective Payment, MS-
DRG Relative Weights, Wage Index, Hospital Geographic
Reclassifications, Graduate Medical Education, Capital Prospective
Payment, Excluded Hospitals, Medicare Disproportionate Share Hospital
(DSH) Payment Adjustment, Sole Community Hospitals (SCHs), Medicare-
Dependent Small Rural Hospital (MDH) Program, Low-Volume Hospital
Payment Adjustment, and Inpatient Critical Access Hospital (CAH)
Issues.
Emily Lipkin, and Jim Mildenberger, <a href="/cdn-cgi/l/email-protection#6226232122010f114c0a0a114c050d14"><span class="__cf_email__" data-cfemail="e0a4a1a3a0838d93ce888893ce878f96">[email protected]</span></a>, Long-Term Care
Hospital Prospective Payment System and MS-LTC-DRG Relative Weights
Issues.
Lily Yuan, <a href="/cdn-cgi/l/email-protection#5c12392b08393f341c3f312f7234342f723b332a"><span class="__cf_email__" data-cfemail="d799b2a083b2b4bf97b4baa4f9bfbfa4f9b0b8a1">[email protected]</span></a>, New Technology Add-On Payments
Issues.
Mady Hue, <a href="/cdn-cgi/l/email-protection#deb3bfacb7b2abf0b6abbb9ebdb3adf0b6b6adf0b9b1a8"><span class="__cf_email__" data-cfemail="80ede1f2e9ecf5aee8f5e5c0e3edf3aee8e8f3aee7eff6">[email protected]</span></a>, and Andrea Hazeley,
<a href="/cdn-cgi/l/email-protection#e4858a80968185ca8c859e8188819da4878997ca8c8c97ca838b92"><span class="__cf_email__" data-cfemail="6b0a050f190e0a45030a110e070e122b08061845030318450c041d">[email protected]</span></a>, MS-DRG Classifications Issues.
Siddhartha Mazumdar, siddhartha.mazumdar @cms.hhs.gov, Rural
Community Hospital Demonstration Program Issues.
Jeris Smith, <a href="/cdn-cgi/l/email-protection#5f353a2d362c712c32362b371f3c322c7137372c71383029"><span class="__cf_email__" data-cfemail="7c16190e150f520f111508143c1f110f5214140f521b130a">[email protected]</span></a>, Frontier Community Health
Integration Project (FCHIP) Demonstration Issues.
Lang Le, <a href="/cdn-cgi/l/email-protection#9af6fbf4fdb4f6ffdaf9f7e9b4f2f2e9b4fdf5ec"><span class="__cf_email__" data-cfemail="dcb0bdb2bbf2b0b99cbfb1aff2b4b4aff2bbb3aa">[email protected]</span></a>, Hospital Readmissions Reduction
Program--Administration Issues.
Ngozi Uzokwe, <a href="/cdn-cgi/l/email-protection#254b424a5f4c0b505f4a4e5240654648560b4d4d560b424a53"><span class="__cf_email__" data-cfemail="5a343d352033742f2035312d3f1a39372974323229743d352c">[email protected]</span></a>, Hospital Readmissions
Reduction Program--Measures Issues.
Jennifer Tate, <a href="/cdn-cgi/l/email-protection#95fff0fbfbfcf3f0e7bbe1f4e1f0d5f6f8e6bbfdfde6bbf2fae3"><span class="__cf_email__" data-cfemail="016b646f6f686764732f7560756441626c722f6969722f666e77">[email protected]</span></a>, Hospital-Acquired
Condition Reduction Program--Administration Issues.
Ngozi Uzokwe, <a href="/cdn-cgi/l/email-protection#e58b828a9f8ccb909f8a8e9280a5868896cb8d8d96cb828a93"><span class="__cf_email__" data-cfemail="741a131b0e1d5a010e1b1f0311341719075a1c1c075a131b02">[email protected]</span></a>, Hospital-Acquired Condition
Reduction Program--Measures Issues.
Julia Venanzi, <a href="/cdn-cgi/l/email-protection#84eef1e8ede5aaf2e1eae5eafeedc4e7e9f7aaececf7aae3ebf2"><span class="__cf_email__" data-cfemail="0f657a63666e21796a616e6175664f6c627c2167677c21686079">[email protected]</span></a>, Hospital Inpatient
Quality Reporting Program and Hospital Value-Based Purchasing Program--
Administration Issues.
Melissa Hager, <a href="/cdn-cgi/l/email-protection#b5d8d0d9dcc6c6d49bddd4d2d0c7f5d6d8c69bddddc69bd2dac3"><span class="__cf_email__" data-cfemail="82efe7eeebf1f1e3aceae3e5e7f0c2e1eff1aceaeaf1ace5edf4">[email protected]</span></a>, and Ngozi Uzokwe,
<a href="/cdn-cgi/l/email-protection#69070e061300471c1306021e0c290a041a4701011a470e061f"><span class="__cf_email__" data-cfemail="224c454d584b0c57584d49554762414f510c4a4a510c454d54">[email protected]</span></a>--Hospital Inpatient Quality Reporting Program
and Hospital Value-Based Purchasing Program--Measures Issues Except
Hospital Consumer Assessment of Healthcare Providers and Systems
Issues.
Elizabeth Goldstein, <a href="/cdn-cgi/l/email-protection#aecbc2c7d4cfcccbdac680c9c1c2cadddacbc7c0eecdc3dd80c6c6dd80c9c1d8"><span class="__cf_email__" data-cfemail="a2c7cecbd8c3c0c7d6ca8cc5cdcec6d1d6c7cbcce2c1cfd18ccacad18cc5cdd4">[email protected]</span></a>, Hospital
Inpatient Quality Reporting and Hospital Value-Based Purchasing--
Hospital Consumer Assessment of Healthcare Providers and Systems
Measures Issues.
Ora Dawedeit, <a href="/cdn-cgi/l/email-protection#630c11024d0702140607060a1723000e104d0b0b104d040c15"><span class="__cf_email__" data-cfemail="620d10034c0603150706070b1622010f114c0a0a114c050d14">[email protected]</span></a>, PPS-Exempt Cancer Hospital
Quality Reporting--Administration Issues.
Leah Domino, <a href="/cdn-cgi/l/email-protection#18747d7970367c7775717677587b756b3670706b367f776e"><span class="__cf_email__" data-cfemail="fa969f9b92d49e9597939495ba999789d4929289d49d958c">[email protected]</span></a>, PPS-Exempt Cancer Hospital
Quality Reporting Program--Measure Issues.
Lorraine Wickiser, <a href="/cdn-cgi/l/email-protection#513d3e232330383f347f2638323a3822342311323c227f3939227f363e27"><span class="__cf_email__" data-cfemail="026e6d7070636b6c672c756b61696b71677042616f712c6a6a712c656d74">[email protected]</span></a>, Long-Term Care
Hospital Quality Reporting Program--Administration Issues.
Jessica Warren, <a href="/cdn-cgi/l/email-protection#204a4553534943410e57415252454e60434d530e4848530e474f56"><span class="__cf_email__" data-cfemail="38525d4b4b515b59164f594a4a5d56785b554b1650504b165f574e">[email protected]</span></a>, and Elizabeth Holland,
<a href="/cdn-cgi/l/email-protection#583d343122393a3d2c30763037343439363c183b352b7630302b763f372e"><span class="__cf_email__" data-cfemail="4f2a2326352e2d2a3b2761272023232e212b0f2c223c6127273c61282039">[email protected]</span></a>, Medicare Promoting Interoperability
Program.
Bridget Dickensheets, <a href="/cdn-cgi/l/email-protection#abc9d9c2cfcccedf85cfc2c8c0cec5d8c3cecedfd8ebc8c6d885c3c3d885ccc4dd"><span class="__cf_email__" data-cfemail="ed8f9f84898a8899c389848e8688839e858888999ead8e809ec385859ec38a829b">[email protected]</span></a> and Mollie
Knight, <a href="/cdn-cgi/l/email-protection#1c717370707579327772757b74685c7f716f3274746f327b736a"><span class="__cf_email__" data-cfemail="87eae8ebebeee2a9ece9eee0eff3c7e4eaf4a9efeff4a9e0e8f1">[email protected]</span></a>, LTCH Market Basket Rebasing.
Benjamin Cohen, <a href="/cdn-cgi/l/email-protection#89ebece7e3e8e4e0e7a7eae6e1ece7c9eae4faa7e1e1faa7eee6ff"><span class="__cf_email__" data-cfemail="3557505b5f54585c5b1b565a5d505b755658461b5d5d461b525a43">[email protected]</span></a>, Provider Reimbursement
Review Board.
<a href="/cdn-cgi/l/email-protection#94dafdf7fcfbf8f5e7bad6fbfafbf9fbd4f7f9e7bafcfce7baf3fbe2"><span class="__cf_email__" data-cfemail="4b0522282324272a38650924252426240b28263865232338652c243d">[email protected]</span></a> and <a href="/cdn-cgi/l/email-protection#47333526243e69342a2e332f33263e2b283507242a34692f2f3469202831"><span class="__cf_email__" data-cfemail="83f7f1e2e0faadf0eeeaf7ebf7e2faefecf1c3e0eef0adebebf0ade4ecf5">[email protected]</span></a>,
Payment Error Rate Measurement Program.
<a href="/cdn-cgi/l/email-protection#efaca2a2a6b0bbaaaea2af8c829cc187879cc1888099"><span class="__cf_email__" data-cfemail="2a69676763757e6f6b676a49475904424259044d455c">[email protected]</span></a>, Transforming Episode Accountability Model
(TEAM).
The Clinical Standards Group, <a href="/cdn-cgi/l/email-protection#d29ab7b3bea6bab3bcb681b3b4b7a6ab9bbca3a7bba0bbb7a192b1bfa1fcbabaa1fcb5bda4"><span class="__cf_email__" data-cfemail="400825212c3428212e24132126253439092e3135293229253300232d336e2828336e272f36">[email protected]</span></a>,
Obstetrical Services Request for Information (RFI).
SUPPLEMENTARY INFORMATION: Inspection of Public Comments: All comments
received before the close of the comment period are available for
viewing by the public, including any personally identifiable or
confidential business information that is included in a comment. We
post all comments received before the close of the comment period on
the following website as soon as possible after they have been
received: <a href="http://www.regulations.gov">http://www.regulations.gov</a>. Follow the search instructions on
that website to view
[[Page 35935]]
public comments. CMS will not post on <a href="http://Regulations.gov">Regulations.gov</a> public comments
that make threats to individuals or institutions or suggest that the
commenter will take actions to harm an individual. CMS continues to
encourage individuals not to submit duplicative comments. We will post
acceptable comments from multiple unique commenters even if the content
is identical or nearly identical to other comments.
Plain Language Summary: In accordance with 5 U.S.C. 553(b)(4), a
plain language summary of this rule may be found at <a href="https://www.regulations.gov/">https://www.regulations.gov/</a>.
Tables Available on the CMS Website
The IPPS tables for this fiscal year (FY) 2025 proposed rule are
available on the CMS website at <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index</a>.html. Click on the link
on the left side of the screen titled ``FY 2025 IPPS Proposed rule Home
Page'' or ``Acute Inpatient--Files for Download.'' The LTCH PPS tables
for this FY 2025 proposed rule are available on the CMS website at
<a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/LongTermCareHospitalPPS/index.html">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/LongTermCareHospitalPPS/index.html</a> under the list item for Regulation
Number CMS-1808-P. For further details on the contents of the tables
referenced in this proposed rule, we refer readers to section VI. of
the Addendum to this FY 2025 IPPS/LTCH PPS proposed rule.
Readers who experience any problems accessing any of the tables
that are posted on the CMS websites, as previously identified, should
contact Michael Treitel, <a href="/cdn-cgi/l/email-protection#a6e2e7e5e6c5cbd588ceced588c1c9d0"><span class="__cf_email__" data-cfemail="1256535152717f613c7a7a613c757d64">[email protected]</span></a>.
I. Executive Summary and Background
A. Executive Summary
1. Purpose and Legal Authority
This FY 2025 IPPS/LTCH PPS proposed rule would make payment and
policy changes under the Medicare inpatient prospective payment system
(IPPS) for operating and capital-related costs of acute care hospitals
as well as for certain hospitals and hospital units excluded from the
IPPS. In addition, it would make payment and policy changes for
inpatient hospital services provided by long-term care hospitals
(LTCHs) under the long-term care hospital prospective payment system
(LTCH PPS). This proposed rule also would make policy changes to
programs associated with Medicare IPPS hospitals, IPPS-excluded
hospitals, and LTCHs. In this FY 2025 proposed rule, we are proposing
to continue policies to address wage index disparities impacting low
wage index hospitals. We are also proposing changes relating to
Medicare graduate medical education (GME) for teaching hospitals and
new technology add-on payments.
We are proposing a separate IPPS payment for establishing and
maintaining access to essential medicines.
In the Hospital Value-Based Purchasing (VBP) Program, we are
proposing to modify scoring of the Person and Community Engagement
Domain for the FY 2027 through FY 2029 program years to only score six
unchanged dimensions of the Hospital Consumer Assessment of Healthcare
Providers and Systems (HCAHPS) Survey, and we are proposing to adopt
the updated HCAHPS Survey in the Hospital VBP Program beginning with
the FY 2030 program year after the updated survey would have been
publicly reported under the Hospital Inpatient Quality Reporting (IQR)
Program for 1 year. We are also proposing to modify scoring on the
HCAHPS Survey beginning with the FY 2030 program year to incorporate
the updated HCAHPS Survey measure into nine survey dimensions. Lastly,
we are providing previously and newly established performance standards
for the FY 2027 through FY 2030 program years for the Hospital VBP
Program.
In the Hospital IQR Program, we are proposing to add seven new
measures, modify two existing measures including the HCAHPS Survey
measure, and remove five measures. We are also proposing changes to the
reporting and submission requirements for electronic clinical quality
measures (eCQMs) and the validation process for the Hospital IQR
Program data.
In the PPS-Exempt Cancer Hospital Quality Reporting Program
(PCHQR), we are proposing to adopt the Patient Safety Structural
measure beginning with the CY 2025 reporting period/FY 2027 program
year. We are also proposing to modify the HCAHPS Survey measure and to
move up the start date for publicly displaying hospital performance on
the Hospital Commitment to Health Equity measure.
In the LTCH QRP, we are proposing to add four items to the LTCH
Continuity Assessment Record and Evaluation (CARE) Data Set (LCDS) and
modify one item on the LCDS beginning with the FY 2028 LTCH QRP.
Additionally, we are proposing to extend the admission assessment
window for the LCDS beginning with the FY 2028 LTCH QRP. Finally, we
are seeking information on future measure concepts for the LTCH QRP and
a future LTCH Star Rating system.
In the Medicare Promoting Interoperability Program, we are
proposing to separate the Antimicrobial Use and Resistance (AUR)
Surveillance measure into two measures, an Antimicrobial Use (AU)
Surveillance measure and an Antimicrobial Resistance (AR) Surveillance
measure, beginning with the electronic health record (EHR) reporting
period in CY 2025. We are proposing to increase the performance-based
scoring threshold from 60 to 80 points beginning with the EHR reporting
period in CY 2025. We are proposing to adopt two new eCQMs and modify
one eCQM, in alignment with the Hospital IQR Program. Finally, we are
proposing changes to the reporting and submission requirements for
eCQMs, in alignment with the Hospital IQR Program.
The Transforming Episode Accountability Model (TEAM) proposes the
creation and testing of a new mandatory alternative payment model. The
intent of TEAM is to improve beneficiary care through financial
accountability for episodes categories that begin with one of the
following procedures: coronary artery bypass graft (CABG), lower
extremity joint replacement (LEJR), major bowel procedure, surgical
hip/femur fracture treatment (SHFFT), and spinal fusion. TEAM would
test whether financial accountability for these episode categories
reduces Medicare expenditures while preserving or enhancing the quality
of care for Medicare beneficiaries. We anticipate that TEAM would
benefit Medicare beneficiaries through improving the coordination of
items and services paid for through Medicare fee-for-service (FFS)
payments, encouraging provider investment in health care infrastructure
and redesigned care processes, and incentivizing higher value care
across the inpatient and post-acute care settings for the episode. We
propose to test TEAM for a 5-year model performance period, beginning
January 1, 2026, and ending December 31, 2030. Under the Quality
Payment Program (QPP), we anticipate that TEAM would be an Advanced
Alternative Payment Model (APM)for Track 2 and Track 3 and a Merit-
based Incentive Payment System (MIPS) APM for all participation tracks.
Under various statutory authorities, we either discuss continued
program implementation or propose to make changes to the Medicare IPPS,
the LTCH PPS, other related payment methodologies and programs for FY
2025 and subsequent fiscal years, and
[[Page 35936]]
other policies and provisions included in this rule. These statutory
authorities include, but are not limited to, the following:
<bullet> Section 1886(d) of the Social Security Act (the Act),
which sets forth a system of payment for the operating costs of acute
care hospital inpatient stays under Medicare Part A (Hospital
Insurance) based on prospectively set rates. Section 1886(g) of the Act
requires that, instead of paying for capital-related costs of inpatient
hospital services on a reasonable cost basis, the Secretary use a
prospective payment system (PPS).
<bullet> Section 1886(d)(1)(B) of the Act, which specifies that
certain hospitals and hospital units are excluded from the IPPS. These
hospitals and units are: rehabilitation hospitals and units; LTCHs;
psychiatric hospitals and units; children's hospitals; cancer
hospitals; extended neoplastic disease care hospitals; and hospitals
located outside the 50 States, the District of Columbia, and Puerto
Rico (that is, hospitals located in the U.S. Virgin Islands, Guam, the
Northern Mariana Islands, and American Samoa). Religious nonmedical
health care institutions (RNHCIs) are also excluded from the IPPS.
<bullet> Sections 123(a) and (c) of the Balanced Budget Refinement
Act of 1999 (BBRA) (Public Law (Pub. L.) 106-113) and section 307(b)(1)
of the Benefits Improvement and Protection Act of 2000 (BIPA) (Pub. L.
106-554) (as codified under section 1886(m)(1) of the Act), which
provide for the development and implementation of a prospective payment
system for payment for inpatient hospital services of LTCHs described
in section 1886(d)(1)(B)(iv) of the Act.
<bullet> Section 1814(l)(4) of the Act requires downward
adjustments to the applicable percentage increase, beginning with FY
2015, for CAHs that do not successfully demonstrate meaningful use of
certified electronic health record technology (CEHRT) for an EHR
reporting period for a payment adjustment year.
<bullet> Section 1886(a)(4) of the Act, which specifies that costs
of approved educational activities are excluded from the operating
costs of inpatient hospital services. Hospitals with approved graduate
medical education (GME) programs are paid for the direct costs of GME
in accordance with section 1886(h) of the Act. Hospitals paid under the
IPPS with approved GME programs are paid for the indirect costs of
training residents in accordance with section 1886(d)(5)(B) of the Act.
<bullet> Section 1886(d)(5)(F) of the Act provides for additional
Medicare IPPS payments to subsection (d) hospitals that serve a
significantly disproportionate number of low-income patients. These
payments are known as the Medicare disproportionate share hospital
(DSH) adjustment. Section 1886(d)(5)(F) of the Act specifies the
methods under which a hospital may qualify for the DSH payment
adjustment.
<bullet> Section 1886(b)(3)(B)(viii) of the Act, which requires the
Secretary to reduce the applicable percentage increase that would
otherwise apply to the standardized amount applicable to a subsection
(d) hospital for discharges occurring in a fiscal year if the hospital
does not submit data on measures in a form and manner, and at a time,
specified by the Secretary.
<bullet> Section 1886(b)(3)(B)(ix) of the Act, which requires
downward adjustments to the applicable percentage increase, beginning
with FY 2015 (and beginning with FY 2022 for subsection (d) Puerto Rico
hospitals), for eligible hospitals that do not successfully demonstrate
meaningful use of CEHRT for an EHR reporting period for a payment
adjustment year.
<bullet> Section 1866(k) of the Act, which provides for the
establishment of a quality reporting program for hospitals described in
section 1886(d)(1)(B)(v) of the Act, referred to as ``PPS-exempt cancer
hospitals.''
<bullet> Section 1886(n) of the Act, which establishes the
requirements for an eligible hospital to be treated as a meaningful EHR
user of CEHRT for an EHR reporting period for a payment adjustment year
or, for purposes of subsection (b)(3)(B)(ix) of the Act, for a fiscal
year.
<bullet> Section 1886(o) of the Act, which requires the Secretary
to establish a Hospital Value-Based Purchasing (VBP) Program, under
which value-based incentive payments are made in a fiscal year to
hospitals based on their performance on measures established for a
performance period for such fiscal year.
<bullet> Section 1886(p) of the Act, which establishes a Hospital-
Acquired Condition (HAC) Reduction Program, under which payments to
applicable hospitals are adjusted to provide an incentive to reduce
hospital-acquired conditions.
<bullet> Section 1886(q) of the Act, as amended by section 15002 of
the 21st Century Cures Act, which establishes the Hospital Readmissions
Reduction Program. Under the program, payments for discharges from an
applicable hospital as defined under section 1886(d) of the Act will be
reduced to account for certain excess readmissions. Section 15002 of
the 21st Century Cures Act directs the Secretary to compare hospitals
with respect to the number of their Medicare-Medicaid dual-eligible
beneficiaries in determining the extent of excess readmissions.
<bullet> Section 1886(r) of the Act, as added by section 3133 of
the Affordable Care Act, which provides for a reduction to
disproportionate share hospital (DSH) payments under section
1886(d)(5)(F) of the Act and for an additional uncompensated care
payment to eligible hospitals. Specifically, section 1886(r) of the Act
requires that, for fiscal year 2014 and each subsequent fiscal year,
subsection (d) hospitals that would otherwise receive a DSH payment
made under section 1886(d)(5)(F) of the Act will receive two separate
payments: (1) 25 percent of the amount they previously would have
received under the statutory formula for Medicare DSH payments in
section 1886(d)(5)(F) of the Act if subsection (r) did not apply (``the
empirically justified amount''), and (2) an additional payment for the
DSH hospital's proportion of uncompensated care, determined as the
product of three factors. These three factors are: (1) 75 percent of
the payments that would otherwise be made under section 1886(d)(5)(F)
of the Act, in the absence of section 1886(r) of the Act; (2) 1 minus
the percent change in the percent of individuals who are uninsured; and
(3) the hospital's uncompensated care amount relative to the
uncompensated care amount of all DSH hospitals expressed as a
percentage.
<bullet> Section 1886(m)(5) of the Act, which requires the
Secretary to reduce by 2 percentage points the annual update to the
standard Federal rate for discharges for a long-term care hospital
(LTCH) during the rate year for LTCHs that do not submit data on
quality measures in the form, manner, and at a time, specified by the
Secretary.
<bullet> Section 1886(m)(6) of the Act, as added by section
1206(a)(1) of the Pathway for Sustainable Growth Rate (SGR) Reform Act
of 2013 (Pub. L. 113-67) and amended by section 51005(a) of the
Bipartisan Budget Act of 2018 (Pub. L. 115-123), which provided for the
establishment of site neutral payment rate criteria under the LTCH PPS,
with implementation beginning in FY 2016. Section 51005(b) of the
Bipartisan Budget Act of 2018 amended section 1886(m)(6)(B) by adding
new clause (iv), which specifies that the IPPS comparable amount
defined in clause (ii)(I) shall be reduced by 4.6 percent for FYs 2018
through 2026.
<bullet> Section 1899B of the Act, which provides for the
establishment of standardized data reporting for certain
[[Page 35937]]
post-acute care providers, including LTCHs.
<bullet> Section 1115A of the Act authorizes the testing of
innovative payment and service delivery models that preserve or enhance
the quality of care furnished to Medicare, Medicaid, and Children's
Health Insurance Program (CHIP) beneficiaries while reducing program
expenditures.
2. Summary of the Major Provisions
The following is a summary of the major provisions in this proposed
rule. In general, these major provisions are being proposed as part of
the annual update to the payment policies and payment rates, consistent
with the applicable statutory provisions. A general summary of the
changes in this proposed rule is presented in section I.D. of the
preamble of this proposed rule.
a. Proposed Continuation of the Low Wage Index Hospital Policy
To help mitigate growing wage index disparities between high wage
and low wage hospitals, in the FY 2020 IPPS/LTCH PPS rule (84 FR 42326
through 42332), we adopted a policy to increase the wage index values
for certain hospitals with low wage index values (the low wage index
hospital policy). This policy was adopted in a budget neutral manner
through an adjustment applied to the standardized amounts for all
hospitals. We indicated our intention that this policy would be
effective for at least 4 years, beginning in FY 2020, in order to allow
employee compensation increases implemented by these hospitals
sufficient time to be reflected in the wage index calculation. As
discussed in section III.G.5. of the preamble of this proposed rule,
while we are using the FY 2021 cost report data for the FY 2025 wage
index, we are unable to comprehensively evaluate the effect, if any,
the low wage index hospital policy had on hospitals' wage increases
during the years the COVID-19 public health emergency (PHE) was in
effect. We believe it is necessary to wait until we have useable data
from fiscal years after the PHE before reaching any conclusions about
the efficacy of the policy. Therefore, we are proposing that the low
wage index hospital policy and the related budget neutrality adjustment
would be effective for at least three more years, beginning in FY 2025.
b. Proposed Separate IPPS Payment for Establishing and Maintaining
Access to Essential Medicines
As discussed in section V.J. of the preamble of this proposed rule,
the Biden-Harris administration has made it a priority to strengthen
the resilience of medical supply chains and support reliable access to
products for public health, including through prevention and mitigation
of medical product shortages. As a first step in this initiative, we
are proposing to establish a separate payment for small, independent
hospitals for the IPPS shares of the additional resource costs to
voluntarily establish and maintain a 6-month buffer stock of one or
more of 86 essential medicines, either directly or through contractual
arrangements with a pharmaceutical manufacturer, distributor, or
intermediary. For the purposes of this policy, we define small,
independent hospitals as hospitals with 100 beds or fewer that are not
part of a chain organization. We are proposing to make this separate
payment in a non-budget neutral manner under section 1886(d)(5)(I) of
the Act. We are proposing that the payment adjustments would commence
for cost reporting periods beginning on or after October 1, 2024.
c. DSH Payment Adjustment, Additional Payment for Uncompensated Care,
and Supplemental Payment
Under section 1886(r) of the Act, which was added by section 3133
of the Affordable Care Act, starting in FY 2014, Medicare
disproportionate share hospitals (DSHs) receive 25 percent of the
amount they previously would have received under the statutory formula
for Medicare DSH payments in section 1886(d)(5)(F) of the Act. The
remaining amount, equal to 75 percent of the amount that would have
been paid as Medicare DSH payments under section 1886(d)(5)(F) of the
Act if subsection (r) did not apply, is paid as additional payments
after the amount is reduced for changes in the percentage of
individuals that are uninsured. Each Medicare DSH that has
uncompensated care will receive an additional payment based on its
share of the total amount of uncompensated care for all Medicare DSHs
for a given time period. This additional payment is known as the
uncompensated care payment.
In this proposed rule, we are proposing to update our estimates of
the three factors used to determine uncompensated care payments for FY
2025. We are also proposing to continue to use uninsured estimates
produced by CMS' Office of the Actuary (OACT) as part of the
development of the National Health Expenditure Accounts (NHEA) in
conjunction with more recently available data in the calculation of
Factor 2. Consistent with the regulation at Sec.
412.106(g)(1)(iii)(C)(11), which was adopted in the FY 2023 IPPS/LTCH
PPS final rule, for FY 2025, we will use the 3 most recent years of
audited data on uncompensated care costs from Worksheet S-10 of the FY
2019, FY 2020, and FY 2021 cost reports to calculate Factor 3 in the
uncompensated care payment methodology for all eligible hospitals.
Beginning with FY 2023 (87 FR 49047 through 49051), we also
established a supplemental payment for IHS and Tribal hospitals and
hospitals located in Puerto Rico. In section IV.D of the preamble of
this proposed rule, we summarize the ongoing methodology for
supplemental payments.
In this proposed rule, we are also proposing, for FY 2025 and
subsequent fiscal years, to calculate the per-discharge amount for
interim uncompensated care payments using the average of the most
recent 3 years of discharge data. Accordingly, for FY 2025, we propose
to use an average of discharge data from FY 2021, FY 2022, and FY 2023.
We believe that our proposed approach will likely result in a better
estimate of the number of discharges during FY 2025 and subsequent
years for purposes of the interim uncompensated care payment
calculation. We propose to codify this proposed approach in new Sec.
412.106(i)(1).
d. Proposed Adoption of the Patient Safety Structural Measure in the
Hospital IQR Program and PCHQR Program
The proposed Patient Safety Structural measure is an attestation-
based measure that assesses whether hospitals have a structure and
culture that prioritizes safety as demonstrated by the following five
domains: (1) leadership commitment to eliminating preventable harm; (2)
strategic planning and organizational policy; (3) culture of safety and
learning health system; (4) accountability and transparency; and (5)
patient and family engagement. Hospitals would attest to whether they
engage in specific evidence-based best practices within each of these
domains to achieve a score from zero to five out of five points. We are
proposing that hospitals would be required to report this measure
beginning with the CY 2025 reporting period/FY 2027 program year for
the PCHQR Program and for the CY 2025 reporting period/FY 2027 payment
determination for the Hospital IQR Program.
[[Page 35938]]
e. Proposed Updated Hospital Consumer Assessment of Healthcare
Providers and Systems (HCAHPS) Survey Measure in the Hospital IQR
Program, Hospital VBP Program, and PCHQR Program
The proposal to use the updated version of the HCAHPS Survey
measure aligns with the National Quality Strategy goal to bring patient
voices to the forefront by incorporating feedback from patients and
caregivers. The proposed updated HCAHPS Survey measure would be adopted
for the Hospital IQR and PCHQR Programs beginning with the CY 2025
reporting period/FY 2027 payment determination and the CY 2025
reporting period/FY 2027 program year, respectively. For the Hospital
VBP Program, we are proposing to modify scoring on the Person and
Community Engagement Domain for the FY 2027 through FY 2029 program
years to only score six unchanged dimensions of the HCAHPS Survey. We
are proposing to adopt the updated HCAHPS Survey measure beginning with
the FY 2030 program year, which would result in nine HCAHPS Survey
dimensions for the Person and Community Engagement Domain. We are also
proposing to modify scoring of the Person and Community Engagement
Domain beginning with the FY 2030 program year to account for the
proposed updates to the HCAHPS Survey.
f. Hospital Value-Based Purchasing (VBP) Program
Section 1886(o) of the Act requires the Secretary to establish a
Hospital VBP Program under which value-based incentive payments are
made in a fiscal year to hospitals based on their performance on
measures established for a performance period for such fiscal year. In
this proposed rule, we are proposing to modify scoring on the Person
and Community Engagement Domain for the FY 2027 through FY 2029 program
years while the updated HCAHPS Survey measure would be publicly
reported under the Hospital IQR Program. In addition, we are proposing
to adopt the updated HCAHPS Survey measure beginning with the FY 2030
program year and modify scoring beginning with the FY 2030 program year
to account for the updated HCAHPS Survey.
g. Hospital Inpatient Quality Reporting (IQR) Program
Under section 1886(b)(3)(B)(viii) of the Act, subsection (d)
hospitals are required to report data on measures selected by the
Secretary for a fiscal year in order to receive the full annual
percentage increase. In the FY 2025 IPPS/LTCH PPS proposed rule, we are
proposing several changes to the Hospital IQR Program. We are proposing
the adoption of seven new measures: (1) Patient Safety Structural
measure beginning with the CY 2025 reporting period/FY 2027 payment
determination; (2) Age Friendly Hospital measure beginning with the CY
2025 reporting period/FY 2027 payment determination; (3) Catheter-
Associated Urinary Tract Infection (CAUTI) Standardized Infection Ratio
Stratified for Oncology Locations beginning with the CY 2026 reporting
period/FY 2028 payment determination; (4) Central Line-Associated
Bloodstream Infection (CLABSI) Standardized Infection Ratio Stratified
for Oncology Locations beginning with the CY 2026 reporting period/FY
2028 reporting period; (5) Hospital Harm--Falls with Injury eCQM
beginning with the CY 2026 reporting period/FY 2028 payment
determination; (6) Hospital Harm--Postoperative Respiratory Failure
eCQM beginning with the CY 2026 reporting period/FY 2028 payment
determination; and (7) Thirty-day Risk-Standardized Death Rate among
Surgical Inpatients with Complications (Failure-to-Rescue) measure
beginning with the July 1, 2023-June 30, 2025 reporting period/FY 2027
payment determination. We are also proposing refinements to two
measures currently in the Hospital IQR Program measure set: (1) Global
Malnutrition Composite Score (GMCS) eCQM, beginning with the CY 2026
reporting period/FY 2028 payment determination; and (2) the HCAHPS
Survey beginning with the CY 2025 reporting period/FY 2027 payment
determination. We are also proposing the removal of five measures: (1)
Death Among Surgical Inpatients with Serious Treatable Complications
(CMS PSI 04) measure beginning with the July 1, 2023-June 30, 2025
reporting period/FY 27 payment determination ; (2) Hospital-level,
Risk-Standardized Payment Associated with a 30-Day Episode-of-Care for
Acute Myocardial Infarction (AMI) measure beginning with the July 1,
2021-June 30, 2024 reporting period/FY 2026 payment determination; (3)
Hospital-level, Risk-Standardized Payment Associated with a 30-Day
Episode-of-Care for Heart Failure (HF) measure beginning with the July
1, 2021-June 30, 2024 reporting period/FY 2026 payment determination;
(4) Hospital-level, Risk-Standardized Payment Associated with a 30-Day
Episode-of-Care for Pneumonia (PN) measure beginning with July 1, 2021-
June 30, 2024 reporting period/FY 2026 payment determination and (5)
Hospital-level, Risk-Standardized Payment Associated with a 30-Day
Episode-of-Care for Elective Primary Total Hip Arthroplasty (THA) and/
or Total Knee Arthroplasty (TKA) measure beginning with the April 1,
2021-March 31, 2024 reporting period/FY 2026 payment determination.
We are proposing to modify eCQM data reporting and submission
requirements by proposing a progressive increase in the number of
mandatory eCQMs a hospital would be required to report on beginning
with the CY 2026 reporting period/FY 2028 payment determination. We are
also proposing two changes to current policies related to validation of
hospital data: (1) to implement eCQM validation scoring based on the
accuracy of eCQM data beginning with the validation of CY 2025 eCQM
data affecting the FY 2028 payment determination; and (2) modification
of the data validation reconsideration request requirements to make
medical records submission optional for reconsideration requests
beginning with CY 2023 discharges/FY 2026 payment determination.
h. PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program
Section 1866(k)(1) of the Act requires, for purposes of FY 2014 and
each subsequent fiscal year, that a hospital described in section
1886(d)(1)(B)(v) of the Act (a PPS-exempt cancer hospital, or a PCH)
submit data in accordance with section 1866(k)(2) of the Act with
respect to such fiscal year. In the FY 2025 IPPS/LTCH PPS proposed
rule, we are proposing to adopt the Patient Safety Structural measure
beginning with the CY 2025 reporting period/FY 2027 program year. We
are also proposing to modify the HCAHPS Survey measure beginning with
the CY 2025 reporting period/FY 2027 program year. We are also
proposing to move up the start date for publicly displaying hospital
performance on the Hospital Commitment to Health Equity measure from
July 2026 to January 2026 or as soon as feasible thereafter.
i. Long-Term Care Hospital Quality Reporting Program (LTCH QRP)
We are proposing the following changes to the LTCH QRP: (1) add
four items to the LCDS beginning with the FY 2028 LTCH QRP; (2) modify
one item on the LCDS beginning with the FY 2028 LTCH QRP; and (3)
extend the admission assessment window for the LCDS beginning with the
FY 2028 LTCH QRP. We are also seeking information on future measure
concepts for the
[[Page 35939]]
LTCH QRP and a future LTCH Star Rating system.
j. Medicare Promoting Interoperability Program
In section X.F. of the preamble of this proposed rule, we are
proposing several changes to the Medicare Promoting Interoperability
Program. Specifically, we are proposing: (1) to separate the
Antimicrobial Use and Resistance (AUR) Surveillance measure into two
measures, an Antimicrobial Use (AU) Surveillance measure and an
Antimicrobial Resistance (AR) Surveillance measure, beginning with the
EHR reporting period in CY 2025; to add a new exclusion for eligible
hospitals or critical access hospitals (CAHs) that do not have a data
source containing the minimal discrete data elements that are required
for AU or AR Surveillance reporting; to modify the applicability of the
existing exclusions to either the AU or AR Surveillance measures,
respectively; and to treat the AU and AR Surveillance measures as new
measures with respect to active engagement beginning with the EHR
reporting period in CY 2025; (2) to increase the performance-based
scoring threshold for eligible hospitals and CAHs reporting under the
Medicare Promoting Interoperability Program from 60 points to 80 points
beginning with the EHR reporting period in CY 2025; (3) to adopt two
new eCQMs that hospitals can select as one of their three self-selected
eCQMs beginning with the CY 2026 reporting period: the Hospital Harm--
Falls with Injury eCQM and the Hospital Harm--Postoperative Respiratory
Failure eCQM; (4) beginning with the CY 2026 reporting period, to
modify one eCQM, the Global Malnutrition Composite Score eCQM; and (5)
to modify eCQM data reporting and submission requirements by proposing
a progressive increase in the number of mandatory eCQMs eligible
hospitals and CAHs would be required to report on beginning with the CY
2026 reporting period.
k. Proposed Distribution of Additional Residency Positions Under the
Provisions of Section 4122 of Subtitle C of the Consolidated
Appropriations Act, 2023 (CAA, 2023)
In this proposed rule, we are including a proposal to implement
section 4122 of the CAA, 2023. Section 4122(a) of the CAA, 2023,
amended section 1886(h) of the Act by adding a new section 1886(h)(10)
of the Act requiring the distribution of additional residency positions
(also referred to as slots) to hospitals. We refer readers to section
V.F.2. of the preamble of this proposed rule for a summary of the
provisions of section 4122 of the CAA, 2023 that we are proposing to
implement in this proposed rule.
l. Extension of the Medicare-Dependent, Small Rural Hospital (MDH)
Program and the Temporary Changes to the Low-Volume Hospital Payment
Adjustment
The Consolidated Appropriations Act, 2024 (CAA, 2024) (Pub. L. 118-
42), enacted on March 9, 2024, extended the MDH program and the
temporary changes to the low-volume hospital qualifying criteria and
payment adjustment under the IPPS for a portion of FY 2025.
Specifically, section 306 of the CAA, 2024 further extended the
modified definition of low-volume hospital and the methodology for
calculating the payment adjustment for low-volume hospitals under
section 1886(d)(12) of the Act through December 31, 2024. Section 307
of the CAA, 2024 extended the MDH program under section 1886(d)(5)(G)
of the Act through December 31, 2024. Prior to enactment of the CAA,
2024, the low-volume hospital qualifying criteria and payment
adjustment were set revert to the statutory requirements that were in
effect prior to FY 2011 at the end of FY 2024 and beginning October 1,
2024, the MDH program would have no longer been in effect.
We recognize the importance of these extensions with respect to the
goal of advancing health equity by addressing the health disparities
that underlie the health system is one of CMS' strategic pillars \1\
and a Biden-Harris Administration priority.\2\ These provisions are
projected to increase payments to IPPS hospitals by approximately $137
million in FY 2025.
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\1\ <a href="https://www.cms.gov/about-cms/what-we-do/cms-strategic-plan">https://www.cms.gov/about-cms/what-we-do/cms-strategic-plan</a>.
\2\ <a href="https://www.whitehouse.gov/priorities/">https://www.whitehouse.gov/priorities/</a>.
m. Transforming Episode Accountability Model (TEAM)
In section X.A. of the preamble of this proposed rule, we propose
the Transforming Episode Accountability Model (TEAM). TEAM would be a
5-year mandatory model tested under the authority of section 1115A of
the Act, beginning on January 1, 2026, and ending on December 31, 2030.
The intent of TEAM is to improve beneficiary care through financial
accountability for episodes categories that begin with one of the
following procedures: coronary artery bypass (CABG), lower extremity
joint replacement (LEJR), major bowel procedure, surgical hip/femur
fracture treatment (SHFFT), and spinal fusion. TEAM would test whether
financial accountability for these episode categories reduces Medicare
expenditures while preserving or enhancing the quality of care for
Medicare beneficiaries.
Under Traditional Medicare, Medicare makes separate payments to
providers and suppliers for the items and services furnished to a
beneficiary over the course of an episode of care. Because providers
and suppliers are paid for each individual item or service delivered,
providers may not be incentivized to invest in quality improvement and
care coordination activities. As a result, care may be fragmented,
unnecessary, or duplicative. By holding hospitals accountable for all
items and services provided during an episode, providers would be
better incentivized to coordinate patient care, avoid duplicative or
unnecessary services, and improve the beneficiary care experience
during care transitions.
Under the TEAM proposals, all acute care hospitals, with limited
exceptions, located within the Core-Based Statistical Areas that CMS
selects for model implementation would be required to participate in
TEAM. As proposed, TEAM would have a 1-year glide path opportunity that
would allow TEAM participants to ease into full financial risk as well
as different participation tracks to accommodate different levels of
financial risk and reward. Episodes would include non-excluded Medicare
Parts A and B items and services and would begin with an anchor
hospitalization or anchor procedure and would end 30 days after
hospital discharge. We are proposing that the following episode
categories, when furnished by a TEAM participant, would initiate a TEAM
Episode: lower extremity joint replacement, surgical hip femur fracture
treatment, spinal fusion, coronary artery bypass graft, and major bowel
procedure.
TEAM participants would continue to bill Medicare FFS as usual but
would receive target prices for episodes prior to each performance
year. Target prices would be based on 3 years of baseline data,
prospectively trended forward to the relevant performance year, and
calculated at the level of MS-DRG/HCPCS episode type and region. Target
prices would also include a discount factor, normalization factor, and
a risk-adjustment. Performance in the model would be assessed by
comparing TEAM participants' actual Medicare FFS spending during a
performance year to their reconciliation target price as well as by
assessing performance on three quality measures. TEAM participants
would earn a payment from CMS, subject to a quality performance
[[Page 35940]]
adjustment, if their spending is below the reconciliation target price.
TEAM participants would owe CMS a repayment amount, subject to a
quality performance adjustment, if their spending was above the
reconciliation target price.
n. Maternity Care Request for Information (RFI)
In alignment with our commitment to addressing the maternal health
crisis, this RFI seeks to gather information on differences between
hospital resources required to provide inpatient pregnancy and
childbirth services to Medicare patients as compared to non-Medicare
patients. To the extent that the resources required differ between
patient populations, we also wish to gather information on the extent
to which non-Medicare payers, or other commercial insurers may be using
the IPPS as a basis for determining their payment rates for inpatient
pregnancy and childbirth services and the effect, if any, that the use
of the IPPS as a basis for determining payment by those payers may have
on maternal health outcomes.
o. Obstetrical Services RFI
As a result of ongoing concerns about the provision of maternity
care in Medicare and Medicaid certified hospitals, CAHS, and REHs, this
proposed rule includes a request for information regarding our intent
to propose baseline health and safety standards for obstetrical
services in future rulemaking. Public comments on the FY 2023 IPPS/LTCH
PPS proposed rule maternal health request for information recommended
that CMS explore options to establish an Obstetrical Services condition
of participation (CoP) for participating hospitals in collaboration
with relevant stakeholders. With this RFI, we hope to further explore
such options as we develop a proposal for a targeted Obstetrical
Services CoP. We are seeking public comment on multiple detailed
questions, ultimately seeking potential solutions that can be
implemented through the hospital CoPs to address well-documented
concerns regarding maternal morbidity, mortality, and access in the
United States. The goal is to ensure that any policy changes improve
maternal health care outcomes, addresses unjust disparities in care,
and do not exacerbate access to care issues.
p. Conditions of Participation Requirements for Hospitals and Critical
Access Hospitals To Report Acute Respiratory Illnesses
In section X.F. of the preamble of this proposed rule, we are
proposing to update the hospital and CAH infection prevention and
control and antibiotic stewardship programs conditions of participation
(CoPs) to extend a limited subset of the current COVID-19 and influenza
data reporting requirements. These proposed reporting requirements
ensure that hospitals and CAHs have appropriate insight related to
evolving infection control needs. Specifically, CMS is proposing to
replace the COVID-19 and Seasonal Influenza reporting standards for
hospitals and CAHs with a new standard addressing acute respiratory
illnesses to require that, beginning on October 1, 2024, hospitals and
CAHs would have to electronically report information about COVID-19,
influenza, and RSV. CMS is proposing that outside of a public health
emergency (PHE), hospitals and CAHs would have to report these data on
a weekly basis.
q. Proposed Changes to the Severity Level Designation for Z Codes
Describing Inadequate Housing and Housing Instability
As discussed in section II.C. of the preamble of this proposed
rule, we are proposing to change the severity level designation for the
social determinants of health (SDOH) diagnosis codes describing
inadequate housing and housing instability from non-complication or
comorbidity (NonCC) to complication or comorbidity (CC) for FY 2025.
Consistent with our annual updates to account for changes in resource
consumption, treatment patterns, and the clinical characteristics of
patients, CMS is recognizing inadequate housing and housing instability
as indicators of increased resource utilization in the acute inpatient
hospital setting.
Consistent with the Administration's goal of advancing health
equity for all, including members of historically underserved and
under-resourced communities, as described in the President's January
20, 2021 Executive Order 13985 on ``Advancing Racial Equity and Support
for Underserved Communities Through the Federal Government,'' \[1]\ we
also continue to be interested in receiving feedback on how we might
further foster the documentation and reporting of the diagnosis codes
describing social and economic circumstances to more accurately reflect
each health care encounter and improve the reliability and validity of
the coded data including in support of efforts to advance health
equity.
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\[1]\ Available at 86 FR 7009 (January 25, 2021) (<a href="https://www.federalregister.gov/documents/2021/01/25/2021-01753/advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government">https://www.federalregister.gov/documents/2021/01/25/2021-01753/advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government</a>).
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3. Summary of Costs and Benefits
The following table provides a summary of the costs, savings, and
benefits associated with the major provisions described in section
I.A.2. of the preamble of this proposed rule.
BILLING CODE 4120-01-P
[[Page 35941]]
[GRAPHIC] [TIFF OMITTED] TP02MY24.000
[[Page 35942]]
[GRAPHIC] [TIFF OMITTED] TP02MY24.001
[[Page 35943]]
BILLING CODE 4120-01-C
B. Background Summary
1. Acute Care Hospital Inpatient Prospective Payment System (IPPS)
Section 1886(d) of the Act sets forth a system of payment for the
operating costs of acute care hospital inpatient stays under Medicare
Part A (Hospital Insurance) based on prospectively set rates. Section
1886(g) of the Act requires the Secretary to use a prospective payment
system (PPS) to pay for the capital-related costs of inpatient hospital
services for these ``subsection (d) hospitals.'' Under these PPSs,
Medicare payment for hospital inpatient operating and capital-related
costs is made at predetermined, specific rates for each hospital
discharge. Discharges are classified according to a list of diagnosis-
related groups (DRGs).
The base payment rate is comprised of a standardized amount that is
divided into a labor-related share and a nonlabor-related share. The
labor-related share is adjusted by the wage index applicable to the
area where the hospital is located. If the hospital is located in
Alaska or Hawaii, the nonlabor-related share is adjusted by a cost-of-
living adjustment factor. This base payment rate is multiplied by the
DRG relative weight.
If the hospital treats a high percentage of certain low-income
patients, it receives a percentage add-on payment applied to the DRG-
adjusted base payment rate. This add-on payment, known as the
disproportionate share hospital (DSH) adjustment, provides for a
percentage increase in Medicare payments to hospitals that qualify
under either of two statutory formulas designed to identify hospitals
that serve a disproportionate share of low-income patients. For
qualifying hospitals, the amount of this adjustment varies based on the
outcome of the statutory calculations. The Affordable Care Act revised
the Medicare DSH payment methodology and provides for an additional
Medicare payment beginning on October 1, 2013, that considers the
amount of uncompensated care furnished by the hospital relative to all
other qualifying hospitals.
If the hospital is training residents in an approved residency
program(s), it receives a percentage add-on payment for each case paid
under the IPPS, known as the indirect medical education (IME)
adjustment. This percentage varies, depending on the ratio of residents
to beds.
Additional payments may be made for cases that involve new
technologies or medical services that have been approved for special
add-on payments. In general, to qualify, a new technology or medical
service must demonstrate that it is a substantial clinical improvement
over technologies or services otherwise available, and that, absent an
add-on payment, it would be inadequately paid under the regular DRG
payment. In addition, certain transformative new devices and certain
antimicrobial products may qualify under an alternative inpatient new
technology add-on payment pathway by demonstrating that, absent an add-
on payment, they would be inadequately paid under the regular DRG
payment.
The costs incurred by the hospital for a case are evaluated to
determine whether the hospital is eligible for an additional payment as
an outlier case. This additional payment is designed to protect the
hospital from large financial losses due to unusually expensive cases.
Any eligible outlier payment is added to the DRG-adjusted base payment
rate, plus any DSH, IME, and new technology or medical service add-on
adjustments and, beginning in FY 2023 for IHS and Tribal hospitals and
hospitals located in Puerto Rico, the new supplemental payment.
Although payments to most hospitals under the IPPS are made on the
basis of the standardized amounts, some categories of hospitals are
paid in whole or in part based on their hospital-specific rate, which
is determined from their costs in a base year. For example, sole
community hospitals (SCHs) receive the higher of a hospital-specific
rate based on their costs in a base year (the highest of FY 1982, FY
1987, FY 1996, or FY 2006) or the IPPS Federal rate based on the
standardized amount. SCHs are the sole source of care in their areas.
Specifically, section 1886(d)(5)(D)(iii) of the Act defines an SCH as a
hospital that is located more than 35 road miles from another hospital
or that, by reason of factors such as an isolated location, weather
conditions, travel conditions, or absence of other like hospitals (as
determined by the Secretary), is the sole source of hospital inpatient
services reasonably available to Medicare beneficiaries. In addition,
certain rural hospitals previously designated by the Secretary as
essential access community hospitals are considered SCHs.
With the recent enactment of section 307 of the CAA, 2024, under
current law, the Medicare-dependent, small rural hospital (MDH) program
is effective through December 31, 2024. For discharges occurring on or
after October 1, 2007, but before January 1, 2025, an MDH receives the
higher of the Federal rate or the Federal rate plus 75 percent of the
amount by which the Federal rate is exceeded by the highest of its FY
1982, FY 1987, or FY 2002 hospital-specific rate. MDHs are a major
source of care for Medicare beneficiaries in their areas. Section
1886(d)(5)(G)(iv) of the Act defines an MDH as a hospital that is
located in a rural area (or, as amended by the Bipartisan Budget Act of
2018, a hospital located in a State with no rural area that meets
certain statutory criteria), has not more than 100 beds, is not an SCH,
and has a high percentage of Medicare discharges (not less than 60
percent of its inpatient days or discharges in its cost reporting year
beginning in FY 1987 or in two of its three most recently settled
Medicare cost reporting years). As section 307 of the CAA, 2024
extended the MDH program through the first quarter of FY 2025 only,
beginning on January 1, 2025, the MDH program will no longer be in
effect absent a change in law. Because the MDH program is not
authorized by statute beyond December 31, 2024, beginning January 1,
2025, all hospitals that previously qualified for MDH status under
section 1886(d)(5)(G) of the Act will no longer have MDH status and
will be paid based on the IPPS Federal rate.
Section 1886(g) of the Act requires the Secretary to pay for the
capital-related costs of inpatient hospital services in accordance with
a prospective payment system established by the Secretary. The basic
methodology for determining capital prospective payments is set forth
in our regulations at 42 CFR 412.308 and 412.312. Under the capital
IPPS, payments are adjusted by the same DRG for the case as they are
under the operating IPPS. Capital IPPS payments are also adjusted for
IME and DSH, similar to the adjustments made under the operating IPPS.
In addition, hospitals may receive outlier payments for those cases
that have unusually high costs.
The existing regulations governing payments to hospitals under the
IPPS are located in 42 CFR part 412, subparts A through M.
2. Hospitals and Hospital Units Excluded From the IPPS
Under section 1886(d)(1)(B) of the Act, as amended, certain
hospitals and hospital units are excluded from the IPPS. These
hospitals and units are: Inpatient rehabilitation facility (IRF)
hospitals and units; long-term care hospitals (LTCHs); psychiatric
hospitals and units; children's hospitals; cancer hospitals; extended
neoplastic disease care hospitals, and hospitals located outside the 50
States, the District of Columbia, and Puerto Rico (that is, hospitals
located in the U.S. Virgin
[[Page 35944]]
Islands, Guam, the Northern Mariana Islands, and American Samoa).
Religious nonmedical health care institutions (RNHCIs) are also
excluded from the IPPS. Various sections of the Balanced Budget Act of
1997 (BBA) (Pub. L. 105-33), the Medicare, Medicaid and SCHIP [State
Children's Health Insurance Program] Balanced Budget Refinement Act of
1999 (BBRA, Pub. L. 106-113), and the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000 (BIPA, Pub. L. 106-554)
provide for the implementation of PPSs for IRF hospitals and units,
LTCHs, and psychiatric hospitals and units (referred to as inpatient
psychiatric facilities (IPFs)). (We note that the annual updates to the
LTCH PPS are included along with the IPPS annual update in this
document. Updates to the IRF PPS and IPF PPS are issued as separate
documents.) Children's hospitals, cancer hospitals, hospitals located
outside the 50 States, the District of Columbia, and Puerto Rico (that
is, hospitals located in the U.S. Virgin Islands, Guam, the Northern
Mariana Islands, and American Samoa), and RNHCIs continue to be paid
solely under a reasonable cost-based system, subject to a rate-of-
increase ceiling on inpatient operating costs. Similarly, extended
neoplastic disease care hospitals are paid on a reasonable cost basis,
subject to a rate-of-increase ceiling on inpatient operating costs.
The existing regulations governing payments to excluded hospitals
and hospital units are located in 42 CFR parts 412 and 413.
3. Long-Term Care Hospital Prospective Payment System (LTCH PPS)
The Medicare prospective payment system (PPS) for LTCHs applies to
hospitals described in section 1886(d)(1)(B)(iv) of the Act, effective
for cost reporting periods beginning on or after October 1, 2002. The
LTCH PPS was established under the authority of sections 123 of the
BBRA and section 307(b) of the BIPA (as codified under section
1886(m)(1) of the Act). Section 1206(a) of the Pathway for SGR Reform
Act of 2013 (Pub. L. 113-67) established the site neutral payment rate
under the LTCH PPS, which made the LTCH PPS a dual rate payment system
beginning in FY 2016. Under this statute, effective for LTCH's cost
reporting periods beginning in FY 2016 cost reporting period, LTCHs are
generally paid for discharges at the site neutral payment rate unless
the discharge meets the patient criteria for payment at the LTCH PPS
standard Federal payment rate. The existing regulations governing
payment under the LTCH PPS are located in 42 CFR part 412, subpart O.
Beginning October 1, 2009, we issue the annual updates to the LTCH PPS
in the same documents that update the IPPS.
4. Critical Access Hospitals (CAHs)
Under sections 1814(l), 1820, and 1834(g) of the Act, payments made
to critical access hospitals (CAHs) (that is, rural hospitals or
facilities that meet certain statutory requirements) for inpatient and
outpatient services are generally based on 101 percent of reasonable
cost. Reasonable cost is determined under the provisions of section
1861(v) of the Act and existing regulations under 42 CFR part 413.
5. Payments for Graduate Medical Education (GME)
Under section 1886(a)(4) of the Act, costs of approved educational
activities are excluded from the operating costs of inpatient hospital
services. Hospitals with approved graduate medical education (GME)
programs are paid for the direct costs of GME in accordance with
section 1886(h) of the Act. The amount of payment for direct GME costs
for a cost reporting period is based on the hospital's number of
residents in that period and the hospital's costs per resident in a
base year. The existing regulations governing payments to the various
types of hospitals are located in 42 CFR part 413. Section
1886(d)(5)(B) of the Act provides that prospective payment hospitals
that have residents in an approved GME program receive an additional
payment for each Medicare discharge to reflect the higher patient care
costs of teaching hospitals relative to non-teaching hospitals. The
additional payment is based on the indirect medical education (IME)
adjustment factor, which is calculated using a hospital's ratio of
residents to beds and a multiplier, which is set by Congress. Section
1886(d)(5)(B)(ii)(XII) of the Act provides that, for discharges
occurring during FY 2008 and fiscal years thereafter, the IME formula
multiplier is 1.35. The regulations regarding the indirect medical
education (IME) adjustment are located at 42 CFR 412.105.
C. Summary of Provisions of Recent Legislation That Would Be
Implemented in This Proposed Rule
1. The Consolidated Appropriations Act, 2023 (CAA 2023; Pub. L. 117-
328)
Section 4122 of the CAA, 2023, amended section 1886(h) of the Act
by adding a new section 1886(h)(10) of the Act requiring the
distribution of additional residency positions (also referred to as
slots) to hospitals. Section 1886(h)(10)(A) of the Act requires that
for FY 2026, the Secretary shall initiate an application round to
distribute 200 residency positions. At least 100 of the positions made
available under section 1886(h)(10)(A) of the Act shall be distributed
for psychiatry or psychiatry subspecialty residency training programs.
The Secretary is required, subject to certain provisions in the law, to
increase the otherwise applicable resident limit for each qualifying
hospital that submits a timely application by the number of positions
that may be approved by the Secretary for that hospital. The Secretary
is required to notify hospitals of the number of positions distributed
to them by January 31, 2026, and the increase is effective beginning
July 1, 2026.
In determining the qualifying hospitals for which an increase is
provided, section 1886(h)(10)(B)(i) of the Act requires the Secretary
to take into account the ``demonstrated likelihood'' of the hospital
filling the positions made available within the first 5 training years
beginning after the date the increase would be effective, as determined
by the Secretary.
Section 1886(h)(10)(B)(ii) of the Act requires a minimum
distribution for certain categories of hospitals. Specifically, the
Secretary is required to distribute at least 10 percent of the
aggregate number of total residency positions available to each of four
categories of hospitals. Stated briefly, and discussed in greater
detail later in this proposed rule, the categories are as follows: (1)
hospitals located in rural areas or that are treated as being located
in a rural area (pursuant to sections 1886(d)(2)(D) and 1886(d)(8)(E)
of the Act); (2) hospitals in which the reference resident level of the
hospital is greater than the otherwise applicable resident limit; (3)
hospitals in States with new medical schools or additional locations
and branches of existing medical schools; and (4) hospitals that serve
areas designated as Health Professional Shortage Areas (HPSAs). Section
1886(h)(10)(F)(iii) of the Act defines a qualifying hospital as a
hospital in one of these four categories.
Section 1886(h)(10)(B)(iii) of the Act further requires that each
qualifying hospital that submits a timely application receive at least
1 (or a fraction of 1) of the residency positions made available under
section 1886(h)(10) of the Act before any qualifying hospital receives
more than 1 residency position.
Section 1886(h)(10)(C) of the Act places certain limitations on the
distribution of the residency positions.
[[Page 35945]]
First, a hospital may not receive more than 10 additional full-time
equivalent (FTE) residency positions. Second, no increase in the
otherwise applicable resident limit of a hospital may be made unless
the hospital agrees to increase the total number of FTE residency
positions under the approved medical residency training program of the
hospital by the number of positions made available to that hospital.
Third, if a hospital that receives an increase to its otherwise
applicable resident limit under section 1886(h)(10) of the Act is
eligible for an increase to its otherwise applicable resident limit
under 42 CFR 413.79(e)(3) (or any successor regulation), that hospital
must ensure that residency positions received under section 1886(h)(10)
of the Act are used to expand an existing residency training program
and not for participation in a new residency training program.
2. The Consolidated Appropriations Act, 2024 (CAA, 2024; Pub. L. 118-
42)
Section 306 of the CAA, 2024 extended through the first 3 months of
FY 2025 the modified definition of a low-volume hospital and the
methodology for calculating the payment adjustment for low-volume
hospitals in effect for FYs 2019 through 2024. Specifically, under
section 1886(d)(12)(C)(i) of the Act, as amended, for FYs 2019 through
2024 and the portion of FY 2025 occurring before January 1, 2025, a
subsection (d) hospital qualifies as a low-volume hospital if it is
more than 15 road miles from another subsection (d) hospital and has
less than 3,800 total discharges during the fiscal year. Under section
1886(d)(12)(D) of the Act, as amended, for discharges occurring in FYs
2019 through December 31, 2024, the Secretary determines the applicable
percentage increase using a continuous, linear sliding scale ranging
from an additional 25 percent payment adjustment for low-volume
hospitals with 500 or fewer discharges to a zero percent additional
payment for low-volume hospitals with more than 3,800 discharges in the
fiscal year.
Section 307 of the CAA, 2024 amended sections 1886(d)(5)(G)(i) and
1886(d)(5)(G)(ii)(II) of the Act to provide for an extension of the MDH
program through the first 3 months of FY 2025 (that is, through
December 31, 2024).
D. Summary of the Proposed Provisions
In this proposed rule, we set forth proposed payment and policy
changes to the Medicare IPPS for FY 2025 operating costs and capital-
related costs of acute care hospitals and certain hospitals and
hospital units that are excluded from IPPS. In addition, we set forth
proposed changes to the payment rates, factors, and other payment and
policy-related changes to programs associated with payment rate
policies under the LTCH PPS for FY 2025.
The following is a general summary of the changes that we are
proposing to make in this proposed rule.
1. Proposed Changes to MS-DRG Classifications and Recalibrations of
Relative Weights
In section II. of the preamble of this proposed rule, we include
the following:
<bullet> Proposed changes to MS-DRG classifications based on our
yearly review for FY 2025.
<bullet> Proposed recalibration of the MS-DRG relative weights.
<bullet> A discussion of the proposed FY 2025 status of new
technologies approved for add-on payments for FY 2024, a presentation
of our evaluation and analysis of the FY 2025 applicants for add-on
payments for high-cost new medical services and technologies (including
public input, as directed by the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (MMA) Pub. L. 108-173,
obtained in a town hall meeting for applications not submitted under an
alternative pathway), and a discussion of the proposed status of FY
2025 new technology applicants under the alternative pathways for
certain medical devices and certain antimicrobial products.
<bullet> A proposal to change the April 1 cutoff to October 1 for
determining whether a technology would be within its 2- to 3-year
newness period when considering eligibility for new technology add-on
payments, beginning in FY 2026, effective for those technologies that
are approved for new technology add-on payments starting in FY 2025 or
a subsequent years (as discussed in II.E.7. of the preamble of this
proposed rule).
<bullet> A proposal that, beginning with new technology add-on
payment applications for FY 2026, we will no longer consider a hold
status to be an inactive status for the purposes of eligibility for the
new technology add-on payment (as discussed in section II.E.8. of the
preamble of this proposed rule).
<bullet> A proposal that, subject to our review of the new
technology add-on payment eligibility criteria, for certain gene
therapies approved for new technology add-on payments in the FY 2025
IPPS/LTCH final rule for the treatment of sickle cell disease (SCD),
effective with discharges on or after October 1, 2024, and concluding
at the end of the 2- to 3-year newness period for such therapy, we will
temporarily increase the new technology add-on payment percentage to 75
percent (as discussed in section II.E.9. of the preamble of this
proposed rule).
2. Proposed Changes to the Hospital Wage Index for Acute Care Hospitals
In section III. of the preamble of this proposed rule, we propose
revisions to the wage index for acute care hospitals and the annual
update of the wage data. Specific issues addressed include, but are not
limited to, the following:
<bullet> Proposed changes in CBSAs as a result of new OMB labor
market area delineations and proposed policies related to the proposed
changes in CBSAs.
<bullet> The proposed FY 2025 wage index update using wage data
from cost reporting periods beginning in FY 2019.
<bullet> Calculation, analysis, and implementation of the proposed
occupational mix adjustment to the wage index for acute care hospitals
for FY 2025 based on the 2022 Occupational Mix Survey.
<bullet> Proposed application of the rural, imputed and frontier
State floors, and continuation of the low wage index hospital policy.
<bullet> Proposed revisions to the wage index for acute care
hospitals, based on hospital redesignations and reclassifications under
sections 1886(d)(8)(B), (d)(8)(E), and (d)(10) of the Act.
<bullet> Proposed adjustment to the wage index for acute care
hospitals for FY 2025 based on commuting patterns of hospital employees
who reside in a county and work in a different area with a higher wage
index.
<bullet> Proposed labor-related share for the FY 2025 wage index.
3. Payment Adjustment for Medicare Disproportionate Share Hospitals
(DSHs) for FY 2025
In section IV. of the preamble of this proposed rule, we discuss
the following:
<bullet> Proposed calculation of Factor 1 and Factor 2 of the
uncompensated care payment methodology.
<bullet> Proposed methodological approach for determining Factor 3
of the uncompensated care payment for FY 2025, which is the same
methodology that was used for FY 2024.
<bullet> Proposed methodological approach for determining the
amount of interim uncompensated care payments using the average of the
most recent 3 years of discharge data.
[[Page 35946]]
4. Other Decisions and Proposed Changes to the IPPS for Operating Costs
In section V. of the preamble of this proposed rule, we discuss
proposed changes or clarifications of a number of the provisions of the
regulations in 42 CFR parts 412 and 413, including the following:
<bullet> Proposed inpatient hospital update for FY 2025.
<bullet> Proposed updated national and regional case-mix values and
discharges for purposes of determining RRC status and clarification of
the qualification under the discharge criterion for osteopathic
hospitals.
<bullet> Proposed implementation of the statutory extension of the
temporary changes to the low-volume hospital payment adjustment through
December 31, 2024, the statutory expiration beginning January 1, 2025,
and the proposed payment adjustments for low-volume hospitals for FY
2025.
<bullet> Proposed implementation of the statutory extension of the
MDH program through December 31, 2024, and the statutory expiration
beginning January 1, 2025.
<bullet> A proposal to implement a provision of the Consolidated
Appropriations Act relating to payments to hospitals for GME and IME
costs, proposed direct graduate medical education (GME) and indirect
medical education (IME) policy modifications to the criteria for new
residency programs; technical fixes to the DGME regulations; a notice
of closure of two teaching hospitals and opportunities to apply for
available slots and a reminder of core-based statistical area (CBSA)
changes and application to GME policies;.
<bullet> Proposed nursing and allied health education program
Medicare Advantage (MA) add-on rates and direct GME MA percent
reductions for CY 2023.
<bullet> Proposed update to the payment adjustment for certain
clinical trial and expanded access use immunotherapy cases.
Proposed separate IPPS payment for establishing and maintaining
access to essential medicines.
<bullet> Updating the proposed estimate of the financial impacts
for the FY 2025 Hospital Readmissions Reduction Program.
<bullet> Proposed modifications to the scoring of the Person and
Community Engagement Domain in the Hospital VBP Program.
++ For the FY 2027 through FY 2029 program years to only score on
six unchanged dimensions of the HCAHPS Survey.
++ Beginning with the FY 2030 program year to account for the
proposed updated HCAHPS Survey.
<bullet> Updating the proposed estimate of the financial impacts
for the FY 2025 Hospital-Acquired Conditions Reduction Program.
<bullet> Discussion of and proposed changes relating to the
implementation of the Rural Community Hospital Demonstration Program in
FY 2025.
5. Proposed FY 2025 Policy Governing the IPPS for Capital-Related Costs
In section VI. of the preamble of the proposed rule, we discuss the
proposed payment policy requirements for capital-related costs and
capital payments to hospitals for FY 2025.
6. Proposed Changes to the Payment Rates for Certain Excluded
Hospitals: Rate-of-Increase Percentages
In section VII. of the preamble of the proposed rule, we discuss
the following:
<bullet> Proposed changes to payments to certain excluded hospitals
for FY 2025.
<bullet> Proposed continued implementation of the Frontier
Community Health Integration Project (FCHIP) Demonstration.
7. Proposed Changes to the LTCH PPS
In section VIII. of the preamble of the proposed rule, we propose
to rebase and revise the LTCH market basket to reflect a 2022 base
year, which includes a proposed update to the LTCH PPS labor-related
share. In section VIII. of the preamble of the proposed rule, we set
forth proposed changes to the LTCH PPS Federal payment rates, factors,
and other payment rate policies under the LTCH PPS for FY 2025. We are
also proposing a technical clarification to the regulations for
hospitals seeking to be classified as an LTCH.
8. Proposed Changes Relating to Quality Data Reporting for Specific
Providers and Suppliers
In section IX. of the preamble of the proposed rule, we addressed
the following:
<bullet> Solicitation of comment on adopting measures across the
hospital quality reporting and value-based purchasing programs which
capture more forms of unplanned post-acute care and encourage hospitals
to improve discharge processes.
<bullet> Proposed changes to the requirements for the Hospital IQR
Program.
<bullet> Proposed changes to the requirements for the PCHQR
Program.
<bullet> Proposed adoption of the Patient Safety Structural measure
in the Hospital IQR Program and the PCHQR Program.
<bullet> Proposed updated HCAHPS Survey measure in the Hospital IQR
Program, PCHQR Program, and Hospital VBP Program.
<bullet> Proposed changes to the requirements for the Long-Term
Care Hospital Quality Reporting Program (LTCH QRP), and request for
information on future measure concepts for the LTCH QRP and a star
rating system for the LTCH QRP.
<bullet> Proposed changes to requirements pertaining to eligible
hospitals and CAHs participating in the Medicare Promoting
Interoperability Program.
9. Other Proposals and Comment Solicitations Included in the Proposed
Rule
Section X. of the preamble of the proposed rule includes the
following:
<bullet> Proposed implementation of TEAM that would test whether an
episode-based pricing methodology linked with accountability for
quality measure performance for select acute care hospitals reduces
Medicare program expenditures while preserving or improving the quality
of care for Medicare beneficiaries.
<bullet> Proposed changes to permit a Provider Reimbursement Review
Board (PRRB) member to serve up to 3 consecutive terms (9 consecutive
years total), and up to 4 consecutive terms (12 consecutive years
total) in cases where a PRRB Member who, in their second or third
consecutive term, is designated as Chairperson, to continue serving as
Chairperson in the fourth consecutive term.
<bullet> Solicitation of comments to gather information on
differences between hospital resources required to provide inpatient
pregnancy and childbirth services to Medicare patients as compared to
non-Medicare patients.
<bullet> Solicitation of comments to gather information on
potential solutions that can be implemented through the hospital CoPs
to address well-documented concerns regarding maternal morbidity,
mortality, disparities, and maternity care access in the United States.
<bullet> Proposal to remove the exclusion of Puerto Rico from the
Payment Error Rate Measurement (PERM) program found at 42 CFR
431.954(b)(3).
<bullet> Proposal for a new hospital CoP to replace the COVID-19
and Seasonal Influenza reporting standards for hospitals and CAHs that
were created during PHE.
10. Other Provisions of the Proposed Rule
Section XI.A. of the preamble of the proposed rule includes our
discussion of the MedPAC Recommendations.
[[Page 35947]]
Section XI.B. of the preamble of the proposed rule includes a
descriptive listing of the public use files associated with this
proposed rule.
Section XII. of the preamble of the proposed rule includes the
collection of information requirements for entities based on our
proposals.
Section XIII. of the preamble of the proposed rule includes
information regarding our responses to public comments.
11. Determining Prospective Payment Operating and Capital Rates and
Rate-of-Increase Limits for Acute Care Hospitals
In sections II. and III. of the Addendum of the proposed rule, we
set forth proposed changes to the amounts and factors for determining
the proposed FY 2025 prospective payment rates for operating costs and
capital-related costs for acute care hospitals. We are proposing to
establish the threshold amounts for outlier cases. In addition, in
section IV. of the Addendum of the proposed rule, we address the
proposed update factors for determining the rate-of-increase limits for
cost reporting periods beginning in FY 2025 for certain hospitals
excluded from the IPPS.
12. Determining Prospective Payment Rates for LTCHs
In section V. of the Addendum of the proposed rule, we set forth
proposed changes to the amounts and factors for determining the
proposed FY 2025 LTCH PPS standard Federal payment rate and other
factors used to determine LTCH PPS payments under both the LTCH PPS
standard Federal payment rate and the site neutral payment rate in FY
2025. We are proposing to establish the adjustments for the wage index
(including proposed changes to the LTCH PPS labor market area
delineations based on the new OMB delineations), labor-related share,
the cost-of-living adjustment, and high-cost outliers, including the
applicable fixed-loss amounts and the LTCH cost-to-charge ratios (CCRs)
for both payment rates.
13. Impact Analysis
In Appendix A of the proposed rule, we set forth an analysis of the
impact the proposed changes would have on affected acute care
hospitals, CAHs, LTCHs and other entities.
14. Recommendation of Update Factors for Operating Cost Rates of
Payment for Hospital Inpatient Services
In Appendix B of the proposed rule, as required by sections
1886(e)(4) and (e)(5) of the Act, we provide our recommendations of the
appropriate percentage changes for FY 2025 for the following:
<bullet> A single average standardized amount for all areas for
hospital inpatient services paid under the IPPS for operating costs of
acute care hospitals (and hospital-specific rates applicable to SCHs
and MDHs).
<bullet> Target rate-of-increase limits to the allowable operating
costs of hospital inpatient services furnished by certain hospitals
excluded from the IPPS.
<bullet> The LTCH PPS standard Federal payment rate and the site
neutral payment rate for hospital inpatient services provided for LTCH
PPS discharges.
15. Discussion of Medicare Payment Advisory Commission Recommendations
Under section 1805(b) of the Act, MedPAC is required to submit a
report to Congress, no later than March 15 of each year, in which
MedPAC reviews and makes recommendations on Medicare payment policies.
MedPAC's March 2024 recommendations concerning hospital inpatient
payment policies address the update factor for hospital inpatient
operating costs and capital-related costs for hospitals under the IPPS.
We address these recommendations in Appendix B of the proposed rule.
For further information relating specifically to the MedPAC March 2024
report or to obtain a copy of the report, contact MedPAC at (202) 220-
3700 or visit MedPAC's website at <a href="https://www.medpac.gov">https://www.medpac.gov</a>.
II. Proposed Changes to Medicare Severity Diagnosis-Related Group (MS-
DRG) Classifications and Relative Weights
A. Background
Section 1886(d) of the Act specifies that the Secretary shall
establish a classification system (referred to as diagnosis-related
groups (DRGs)) for inpatient discharges and adjust payments under the
IPPS based on appropriate weighting factors assigned to each DRG.
Therefore, under the IPPS, Medicare pays for inpatient hospital
services on a rate per discharge basis that varies according to the DRG
to which a beneficiary's stay is assigned. The formula used to
calculate payment for a specific case multiplies an individual
hospital's payment rate per case by the weight of the DRG to which the
case is assigned. Each DRG weight represents the average resources
required to care for cases in that particular DRG, relative to the
average resources used to treat cases in all DRGs.
Section 1886(d)(4)(C) of the Act requires that the Secretary adjust
the DRG classifications and relative weights at least annually to
account for changes in resource consumption. These adjustments are made
to reflect changes in treatment patterns, technology, and any other
factors that may change the relative use of hospital resources.
B. Adoption of the MS-DRGs and MS-DRG Reclassifications
For information on the adoption of the MS-DRGs in FY 2008, we refer
readers to the FY 2008 IPPS final rule with comment period (72 FR 47140
through 47189).
For general information about the MS-DRG system, including yearly
reviews and changes to the MS-DRGs, we refer readers to the previous
discussions in the FY 2010 IPPS/RY 2010 LTCH PPS final rule (74 FR
43764 through 43766) and the FYs 2011 through 2024 IPPS/LTCH PPS final
rules (75 FR 50053 through 50055; 76 FR 51485 through 51487; 77 FR
53273; 78 FR 50512; 79 FR 49871; 80 FR 49342; 81 FR 56787 through
56872; 82 FR 38010 through 38085; 83 FR 41158 through 41258; 84 FR
42058 through 42165; 85 FR 58445 through 58596; 86 FR 44795 through
44961; 87 FR 48800 through 48891; and 88 FR 58654 through 58787,
respectively).
For discussion regarding our previously finalized policies
(including our historical adjustments to the payment rates) relating to
the effect of changes in documentation and coding that do not reflect
real changes in case mix, we refer readers to the FY 2023 IPPS/LTCH PPS
final rule (87 FR 48799 through 48800).
C. Proposed Changes to Specific MS-DRG Classifications
1. Discussion of Changes to Coding System and Basis for Proposed FY
2025 MS-DRG Updates
a. Conversion of MS-DRGs to the International Classification of
Diseases, 10th Revision (ICD-10)
As of October 1, 2015, providers use the International
Classification of Diseases, 10th Revision (ICD-10) coding system to
report diagnoses and procedures for Medicare hospital inpatient
services under the MS-DRG system instead of the ICD-9-CM coding system,
which was used through September 30, 2015. The ICD-10 coding system
includes the International Classification of Diseases, 10th Revision,
Clinical Modification (ICD-10-CM) for diagnosis coding and the
International Classification of Diseases, 10th Revision, Procedure
Coding
[[Page 35948]]
System (ICD-10-PCS) for inpatient hospital procedure coding, as well as
the ICD-10-CM and ICD-10-PCS Official Guidelines for Coding and
Reporting. For a detailed discussion of the conversion of the MS-DRGs
to ICD-10, we refer readers to the FY 2017 IPPS/LTCH PPS final rule (81
FR 56787 through 56789).
b. Basis for Proposed FY 2025 MS-DRG Updates
As discussed in the FY 2023 IPPS/LTCH PPS proposed rule (87 FR
28127) and final rule (87 FR 48800 through 48801), beginning with FY
2024 MS-DRG classification change requests, we changed the deadline to
request changes to the MS-DRGs to October 20 of each year to allow for
additional time for the review and consideration of any proposed
updates. We also described the new process for submitting requested
changes to the MS-DRGs via a new electronic application intake system,
Medicare Electronic Application Request Information System<SUP>TM</SUP>
(MEARIS<SUP>TM</SUP>), accessed at <a href="https://mearis.cms.gov">https://mearis.cms.gov</a>. We stated
that effective with FY 2024 MS-DRG classification change requests, CMS
will only accept requests submitted via MEARIS<SUP>TM</SUP> and will no
longer consider requests sent via email. Additionally, we noted that
within MEARIS<SUP>TM</SUP>, we have built in several resources to
support users, including a ``Resources'' section available at <a href="https://mearis.cms.gov/public/resources">https://mearis.cms.gov/public/resources</a> with technical support available under
``Useful Links'' at the bottom of the MEARIS<SUP>TM</SUP> site.
Questions regarding the MEARIS<SUP>TM</SUP> system can be submitted to
CMS using the form available under ``Contact'', also at the bottom of
the MEARIS<SUP>TM</SUP> site. Accordingly, interested parties had to
submit MS-DRG classification change requests for FY 2025 by October 20,
2023.
We note that the burden associated with this information collection
requirement is the time and effort required to collect and submit the
data in the request for MS-DRG classification changes to CMS. The
aforementioned burden is subject to the Paperwork Reduction Act (PRA)
of 1995 and approved under OMB control number 0938-1431 and has an
expiration date of 09/30/2025.
Interested parties should submit any MS-DRG classification change
requests, including any comments and suggestions for FY 2026
consideration by October 20, 2024 via MEARIS<SUP>TM</SUP> at: <a href="https://mearis.cms.gov/public/home">https://mearis.cms.gov/public/home</a>.
As we have discussed in prior rulemaking, we may not be able to
fully consider all of the requests that we receive for the upcoming
fiscal year. We have found that, with the implementation of ICD-10,
some types of requested changes to the MS-DRG classifications require
more extensive research to identify and analyze all of the data that
are relevant to evaluating the potential change. We note in the
discussion that follows those topics for which further research and
analysis are required, and which we will continue to consider in
connection with future rulemaking.
We received four requests to modify the GROUPER logic in a number
of cardiac MS-DRGs under Major Diagnostic Category (MDC) 05 (Diseases
and Disorders of the Circulatory System). Specifically, we received
requests to--
<bullet> Modify the GROUPER logic of new MS-DRG 212 (Concomitant
Aortic and Mitral Valve Procedures) to be defined by cases reporting
procedure codes describing a single open mitral or aortic valve
replacement/repair (MVR or AVR) procedure, plus an open coronary artery
bypass graft procedure (CABG) or open surgical ablation or cardiac
catheterization procedure plus a second concomitant procedure.
<bullet> Modify the GROUPER logic of new MS-DRG 212 by redefining
the procedure code list that describes the performance of a cardiac
catheterization by either removing the ICD-10-PCS codes that describe
plain radiography of coronary artery codes from the logic list or
adding ICD-10-PCS procedure codes that involve computed tomography (CT)
or magnetic resonance imaging (MRI) scanning using contrast to the
list. This requestor also suggested that CMS add ICD-10-PCS procedures
codes that describe endovascular valve replacement or repair procedures
into the GROUPER logic of MS-DRG 212.
<bullet> Modify the GROUPER logic of new MS-DRGs 323, 324 and 325
(Coronary Intravascular Lithotripsy with Intraluminal Device with MCC,
without MCC, and without Intraluminal Device, respectively). In two
separate but related requests, the requestors suggested that we add
procedure codes that describe additional percutaneous coronary
intervention (PCI) procedures such as percutaneous coronary rotational,
laser, and orbital atherectomy to the GROUPER logic of new MS-DRGs 323,
324, and 325.
We appreciate the submissions and related analyses provided by the
requestors for our consideration as we review MS-DRG classification
change requests for FY 2025; however, we note the complexity of the
GROUPER logic for these MS-DRGs in connection with these requests
requires more extensive analyses to identify and evaluate all of the
data relevant to assessing these potential modifications. Specifically,
we note the list of procedure codes that describe the performance of a
cardiac catheterization is in the definition of multiple MS-DRGs in MDC
05. Analyzing the impact of revising this list necessitates evaluating
the impact across numerous other MS-DRGs in MDC 05 that also include
this list in their definition, in addition to new MS-DRG 212. Secondly,
as discussed further in section II.C.4.c of this proposed rule, our
analysis continues to indicate that, when performed, open cardiac valve
replacement and supplement procedures are clinically different from
endovascular cardiac valve replacement and supplement procedures in
terms of technical complexity and hospital resource use. Lastly, as we
have stated in prior rule making (88 FR 58708), atherectomy is distinct
from coronary lithotripsy in that each of these procedures are defined
by clinically distinct definitions and objectives. Additional analysis
to assess for unintended consequences across the classification is
needed as we have made a distinction between the root operations used
to describe atherectomy (Extirpation) and the root operation used to
describe lithotripsy (Fragmentation) in evaluating other requests in
rulemaking. We will need to consider the application of these two root
operations in other scenarios where we have also specifically stated
that Extirpation is not the same as Fragmentation and do not warrant
similar MS-DRG assignment (85 FR 58572 through 58573). Furthermore, as
MS-DRG 212 and MS-DRGs 323, 324 and 325 recently became effective on
October 1, 2023 (FY 2024), we believe additional time is needed to
review and evaluate extensive modifications to the structure of these
MS-DRGs.
We will continue to monitor the data as we consider these issues in
connection with future rulemaking. As we continue the analysis of the
claims data with respect to MS-DRGs in MDC 05, we welcome public
comments and feedback on other factors that should be considered in the
potential restructuring of these MS-DRGs. Feedback and other
suggestions may be directed to MEARIS<SUP>TM</SUP> at: <a href="https://mearis.cms.gov/public/home">https://mearis.cms.gov/public/home</a>. As noted, interested parties should submit
any MS-DRG classification change requests, including any comments and
suggestions for FY 2026 consideration by October 20, 2024 via
MEARIS<SUP>TM</SUP> at: <a href="https://mearis.cms.gov/public/home">https://mearis.cms.gov/public/home</a>.
As we did for the FY 2024 IPPS/LTCH PPS proposed rule, for this FY
2025
[[Page 35949]]
IPPS/LTCH PPS proposed rule we are providing a test version of the ICD-
10 MS-DRG GROUPER Software, Version 42, so that the public can better
analyze and understand the impact of the proposals included in this
proposed rule. We note that this test software reflects the proposed
GROUPER logic for FY 2025. Therefore, it includes the new diagnosis and
procedure codes that are effective for FY 2025 as reflected in Table
6A.--New Diagnosis Codes--FY 2025 and Table 6B.--New Procedure Codes--
FY 2025 associated with this proposed rule and does not include the
diagnosis codes that are invalid beginning in FY 2025 as reflected in
Table 6C.--Invalid Diagnosis Codes--FY 2025, and Table 6D.--Invalid
Procedure Codes--FY 2025 associated with this proposed rule. These
tables are not published in the Addendum to this proposed rule, but are
available on the CMS website at: <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index</a>.html as described in
section VI. of the Addendum to this proposed rule. Because the
diagnosis codes no longer valid for FY 2025 are not reflected in the
test software, we are making available a supplemental file in Table
6P.1a and 6P.1b that includes the mapped Version 42 FY 2025 ICD-10-CM
and ICD-10-PCS codes and the deleted Version 41 FY 2024 ICD-10-CM codes
and V41.1 ICD-10-PCS codes that should be used for testing purposes
with users' available claims data. Therefore, users will have access to
the test software allowing them to build case examples that reflect the
proposals included in this proposed rule. In addition, users will be
able to view the draft version of the ICD-10 MS-DRG Definitions Manual,
Version 42.
We also note that in the FY 2024 IPPS/LTCH PPS final rule (88 FR
58764), we stated that, as discussed in the CY 2024 Outpatient
Prospective Payment System and Ambulatory Surgical Center (OPPS/ASC)
proposed rule (CY 2024 OPPS/ASC proposed rule) (88 FR 49552, July 31,
2023), consistent with the process that is used for updates to the
``Integrated'' Outpatient Code Editor (I/OCE) and other Medicare claims
editing systems, we proposed to address any future revisions to the
IPPS Medicare Code Editor (MCE), including any additions or deletions
of claims edits, as well as the addition or deletion of ICD-10
diagnosis and procedure codes to the applicable MCE edit code lists,
outside of the annual IPPS rulemakings. As discussed in the CY 2024
OPPS/ASC proposed rule, we proposed to remove discussion of the IPPS
MCE from the annual IPPS rulemakings, beginning with the FY 2025
rulemaking, and to generally address future changes or updates to the
MCE through instruction to the Medicare administrative contractors
(MACs). We encouraged readers to review the discussion in the CY 2024
OPPS/ASC proposed rule and submit comments in response to the proposal
by the applicable deadline by following the instructions provided in
that proposed rule.
In the CY 2024 OPPS/ASC final rule (88 FR 82121 through 82124),
after consideration of the public comments we received, we finalized
the proposal to remove discussion of the MCE from the annual IPPS
rulemakings, beginning with FY 2025 rulemaking, and to generally
address future changes or updates to the MCE through instruction to the
MACs. Beginning with FY 2025, in association with the annual proposed
rule, we are making available a draft version of the Definitions of
Medicare Code Edits (MCE) Manual to provide the public with an
opportunity to review any changes that will become effective October 1
for the upcoming fiscal year. In addition, as a result of new and
modified code updates approved after the annual spring ICD-10
Coordination and Maintenance Committee meeting, any further changes to
the MCE will be reflected in the finalized Definitions of Medicare Code
Edits (MCE) Manual, made available in association with the annual final
rule. We are making available the draft FY 2025 ICD-10 MCE Version 42
Manual file on the CMS website at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software</a>.
The MCE manual is comprised of two chapters: Chapter 1: Edit code
lists provides a listing of each edit, an explanation of each edit, and
as applicable, the diagnosis and/or procedure codes for each edit, and
Chapter 2: Code list changes summarizes the changes in the edit code
lists (for example, additions and deletions) from the prior release of
the MCE software. The public may submit any questions, comments,
concerns, or recommendations regarding the MCE to the CMS mailbox at
<a href="/cdn-cgi/l/email-protection#420f11061005012e2331312b242b2123362b2d2c012a232c252702212f316c2a2a316c252d34"><span class="__cf_email__" data-cfemail="90ddc3d4c2d7d3fcf1e3e3f9f6f9f3f1e4f9fffed3f8f1fef7f5d0f3fde3bef8f8e3bef7ffe6">[email protected]</span></a> for our review and consideration.
The test version of the ICD-10 MS-DRG GROUPER Software, Version 42,
the draft version of the ICD-10 MS-DRG Definitions Manual, Version 42,
the draft version of the Definitions of Medicare Code Edits Manual,
Version 42, and the supplemental mapping files in Table 6P.1a and 6P.1b
of the FY 2024 and FY 2025 ICD-10-CM diagnosis and ICD-10-PCS procedure
codes are available at <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/MS-DRG-Classifications-and-Software">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/MS-DRG-Classifications-and-Software</a>.
Following are the changes that we are proposing to the MS-DRGs for
FY 2025. We are inviting public comments on each of the MS-DRG
classification proposed changes, as well as our proposals to maintain
certain existing MS-DRG classifications discussed in this proposed
rule. In some cases, we are proposing changes to the MS-DRG
classifications based on our analysis of claims data and clinical
appropriateness. In other cases, we are proposing to maintain the
existing MS-DRG classifications based on our analysis of claims data
and clinical appropriateness. For this FY 2025 IPPS/LTCH PPS proposed
rule, our MS-DRG analysis was based on ICD-10 claims data from the
September 2023 update of the FY 2023 MedPAR file, which contains
hospital bills received from October 1, 2022 through September 30,
2023. In our discussion of the proposed MS-DRG reclassification
changes, we refer to these claims data as the ``September 2023 update
of the FY 2023 MedPAR file.''
In deciding whether to propose to make further modifications to the
MS-DRGs for particular circumstances brought to our attention, we
consider whether the resource consumption and clinical characteristics
of the patients with a given set of conditions are significantly
different than the remaining patients represented in the MS-DRG. We
evaluate patient care costs using average costs and lengths of stay and
rely on clinical factors to determine whether patients are clinically
distinct or similar to other patients represented in the MS-DRG. In
evaluating resource costs, we consider both the absolute and percentage
differences in average costs between the cases we select for review and
the remainder of cases in the MS-DRG. We also consider variation in
costs within these groups; that is, whether observed average
differences are consistent across patients or attributable to cases
that are extreme in terms of costs or length of stay, or both. Further,
we consider the number of patients who will have a given set of
characteristics and generally prefer not to create a new MS-DRG unless
it would include a substantial number of cases.
In the FY 2021 IPPS/LTCH PPS final rule (85 FR 58448), we finalized
our proposal to expand our existing criteria to create a new
complication or comorbidity (CC) or major complication
[[Page 35950]]
or comorbidity (MCC) subgroup within a base MS-DRG. Specifically, we
finalized the expansion of the criteria to include the NonCC subgroup
for a three-way severity level split. We stated we believed that
applying these criteria to the NonCC subgroup would better reflect
resource stratification as well as promote stability in the relative
weights by avoiding low volume counts for the NonCC level MS-DRGs. We
noted that in our analysis of MS-DRG classification requests for FY
2021 that were received by November 1, 2019, as well as any additional
analyses that were conducted in connection with those requests, we
applied these criteria to each of the MCC, CC, and NonCC subgroups. We
also noted that the application of the NonCC subgroup criteria going
forward may result in modifications to certain MS-DRGs that are
currently split into three severity levels and result in MS-DRGs that
are split into two severity levels. We stated that any proposed
modifications to the MS-DRGs would be addressed in future rulemaking
consistent with our annual process and reflected in Table 5--Proposed
List of Medicare Severity Diagnosis Related Groups (MS-DRGs), Relative
Weighting Factors, and Geometric and Arithmetic Mean Length of Stay for
the applicable fiscal year.
In the FY 2022 IPPS/LTCH PPS final rule (86 FR 44798), we finalized
a delay in applying this technical criterion to existing MS-DRGs until
FY 2023 or future rulemaking, in light of the public health emergency
(PHE). Interested parties recommended that a complete analysis of the
MS-DRG changes to be proposed for future rulemaking in connection with
the expanded three-way severity split criteria be conducted and made
available to enable the public an opportunity to review and consider
the redistribution of cases, the impact to the relative weights,
payment rates, and hospital case mix to allow meaningful comment prior
to implementation.
In the FY 2023 IPPS/LTCH PPS final rule (87 FR 48803), we also
finalized a delay in application of the NonCC subgroup criteria to
existing MS-DRGs with a three-way severity level split in light of the
ongoing PHE and until such time additional analyses can be performed to
assess impacts, as discussed in response to public comments in the FY
2022 and FY 2023 IPPS/LTCH PPS final rules.
In association with our discussion of application of the NonCC
subgroup criteria in the FY 2024 IPPS/LTCH PPS proposed rule (88 FR
26673 through 26676), we provided an alternate test version of the ICD-
10 MS-DRG GROUPER Software, Version 41.A, reflecting the proposed
GROUPER logic for FY 2024 as modified by the application of the NonCC
subgroup criteria to existing MS-DRGs with a three-way severity level
split, available at <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/MS-DRG-Classifications-and-Software">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/MS-DRG-Classifications-and-Software</a>.
Therefore, users had access to the alternate test software allowing
them to build case examples that reflect the proposals included in the
proposed rule with application of the NonCC subgroup criteria. We also
provided additional files including an alternate Table 5--Alternate
List of Medicare Severity Diagnosis Related Groups (MS-DRGs), Relative
Weighting Factors, and Geometric and Arithmetic Mean Length of Stay, an
alternate Length of Stay (LOS) Statistics file, an alternate Case Mix
Index (CMI) file, and an alternate After Outliers Removed and Before
Outliers Removed (AOR_BOR) file. The files are available in association
with the FY 2024 IPPS/LTCH PPS proposed rule on the CMS website at:
<a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps</a>.
We stated that the alternate test software and additional files
were made available so that the public could better analyze and
understand the impact on the proposals included in the proposed rule if
the NonCC subgroup criteria were to be applied to existing MS-DRGs with
a three-way severity level split. We refer readers to the FY 2024 IPPS/
LTCH PPS proposed rule (88 FR 26673 through 26676) for further
discussion of the alternate test software and additional files that
were made available.
In the FY 2024 IPPS/LTCH PPS final rule (88 FR 58655 through
58661), we finalized to delay the application of the NonCC subgroup
criteria to existing MS-DRGs with a three-way severity level split for
FY 2024. We stated that we would continue to review and consider the
feedback we had received in response to the additional information we
made available in association with the FY 2024 IPPS/LTCH PPS proposed
rule for our development of the FY 2025 proposed rule.
We note that the IPPS Payment Impact File made available in
connection with our annual IPPS rulemakings includes information used
to categorize hospitals by various geographic and special payment
consideration groups, including geographic location (urban or rural),
teaching hospital status (that is, whether or not a hospital has GME
residency programs and receives an IME adjustment), DSH hospital status
(that is, whether or not a hospital receives Medicare DSH payments),
special payment groups (that is, SCHs, MDHs, and RRCs) and other
categories reflected in the impact analysis generally shown in Appendix
A of the annual IPPS rulemakings. The IPPS Payment Impact File
associated with the FY 2024 IPPS/LTCH PPS final rule can be found on
the CMS website at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page#Data">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page#Data</a>.
We are proposing to continue to delay application of the NonCC
subgroup criteria to existing MS-DRGs with a three-way severity level
split for FY 2025, as we continue to consider the public comments
received in response to the FY 2024 rulemaking. We encourage interested
parties to review the impacts and other information made available with
the alternate test software (V41.A) and other additional files provided
in connection with the FY 2024 IPPS/LTCH PPS proposed rule, as
previously discussed, and we continue to welcome feedback for
consideration for future rulemaking.
As discussed in the FY 2024 IPPS/LTCH PPS final rule (88 FR 58661),
we continue to apply the criteria to create subgroups, including
application of the NonCC subgroup criteria, in our annual analysis of
MS-DRG classification requests, consistent with our approach since FY
2021 when we finalized the expansion of the criteria to include the
NonCC subgroup for a three-way severity level split. Accordingly, in
our analysis of the MS-DRG classification requests for FY 2025 that we
received by October 20, 2023, as well as any additional analyses that
were conducted in connection with those requests, we applied these
criteria to each of the MCC, CC, and NonCC subgroups, as described in
the following table.
[[Page 35951]]
[GRAPHIC] [TIFF OMITTED] TP02MY24.002
In general, once the decision has been made to propose to make
further modifications to the MS-DRGs as described previously, such as
creating a new base MS-DRG, or in our evaluation of a specific MS-DRG
classification request to split (or subdivide) an existing base MS-DRG
into severity levels, all five criteria must be met for the base MS-DRG
to be split (or subdivided) by a CC subgroup. We note that in our
analysis of requests to create a new MS-DRG, we typically evaluate the
most recent year of MedPAR claims data available. For example, we
stated earlier that for this FY 2025 IPPS/LTCH PPS proposed rule, our
MS-DRG analysis was based on ICD-10 claims data from the September 2023
update of the FY 2023 MedPAR file. However, in our evaluation of
requests to split an existing base MS-DRG into severity levels, as
noted in prior rulemaking (80 FR 49368), we typically analyze the most
recent 2 years of data. This analysis includes 2 years of MedPAR claims
data to compare the data results from one year to the next to avoid
making determinations about whether additional severity levels are
warranted based on an isolated year's data fluctuation and also, to
validate that the established severity levels within a base MS-DRG are
supported. The first step in our process of evaluating if the creation
of a new CC subgroup within a base MS-DRG is warranted is to determine
if all the criteria is satisfied for a three-way split. In applying the
criteria for a three-way split, a base MS-DRG is initially subdivided
into the three subgroups: MCC, CC, and NonCC. Each subgroup is then
analyzed in relation to the other two subgroups using the volume
(Criteria 1 and 2), average cost (Criteria 3 and 4), and reduction in
variance (Criteria 5). If the criteria fail, the next step is to
determine if the criteria are satisfied for a two-way split. In
applying the criteria for a two-way split, a base MS-DRG is initially
subdivided into two subgroups: ``with MCC'' and ``without MCC'' (1_23)
or ``with CC/MCC'' and ``without CC/MCC'' (12_3). Each subgroup is then
analyzed in relation to the other using the volume (Criteria 1 and 2),
average cost (Criteria 3 and 4), and reduction in variance (Criteria
5). If the criteria for both of the two-way splits fail, then a split
(or CC subgroup) would generally not be warranted for that base MS-DRG.
If the three-way split fails on any one of the five criteria and all
five criteria for both two-way splits (1_23 and 12_3) are met, we would
apply the two-way split with the highest R2 value. We note that if the
request to split (or subdivide) an existing base MS-DRG into severity
levels specifies the request is for either one of the two-way splits
(1_23 or 12_3), in response to the specific request, we will evaluate
the criteria for both of the two-way splits; however, we do not also
evaluate the criteria for a three-way split.
2. Pre-MDC MS-DRG 018 Chimeric Antigen Receptor (CAR) T-cell and Other
Immunotherapies
We received a request to revise the title of Pre-MDC MS-DRG 018
(Chimeric Antigen Receptor (CAR) T-cell and Other Immunotherapies) in
connection with an ICD-10-PCS procedure code request that was submitted
via MEARIS<SUP>TM</SUP> by the December 1, 2023 deadline for
consideration as an agenda topic to be discussed at the March 19-20,
2024 ICD-10 Coordination and Maintenance Committee meeting. The
procedure code request involves the application of an autologous
genetically engineered cell-based gene therapy, prademagene zamikeracel
(PZ), that is indicated in the treatment of recessive dystrophic
epidermolysis bullosa (RDEB), an extremely rare genetic disease of the
skin that leads to large chronic wounds. The proposal was presented and
discussed at the March 19-20, 2024 ICD-10 Coordination and Maintenance
Committee meeting. We refer the reader to the CMS website at <a href="https://www.cms.gov/medicare/coding-billing/icd-10-codes/icd-10-coordination-maintenance-committee-materials">https://www.cms.gov/medicare/coding-billing/icd-10-codes/icd-10-coordination-maintenance-committee-materials</a> for additional detailed information
regarding the request, including a recording of the discussion and the
related meeting materials. Public comments in response to the code
proposal are due by April 19, 2024. The requestor suggested that if
finalized, a new procedure code to identify the application of PZ
should be assigned to Pre-MDC MS-DRG 018 and that the title for Pre-MDC
MS-DRG 018 be revised to reflect ``Chimeric Antigen Receptor (CAR) T
and Other Autologous Gene and Cell Therapies''.
Because the diagnosis and procedure code proposals that are
presented at the March ICD-10-CM Coordination and Maintenance Committee
meeting for an October 1 implementation (upcoming FY) are not finalized
in time to include in Table 6A.--New Diagnosis Codes and Table 6B.--New
Procedure Codes in association with the proposed rule, as we have noted
in prior rulemaking, we use our established process to examine the MS-
DRG assignment for the predecessor codes to determine the most
appropriate MS-DRG assignment. Specifically, we review the predecessor
code and MS-DRG assignment most closely associated with the new
procedure code, and in the absence of claims data, we consider other
factors
[[Page 35952]]
that may be relevant to the MS-DRG assignment, including the severity
of illness, treatment difficulty, complexity of service and the
resources utilized in the diagnosis and/or treatment of the condition.
We have noted in prior rulemaking that this process does not
automatically result in the new procedure code being assigned to the
same MS-DRG or to have the same designation (O.R. versus Non-O.R.) as
the predecessor code. Under this established process, the MS-DRG
assignment for the upcoming fiscal year for any new diagnosis or
procedure codes finalized after the March meeting would be reflected in
Table 6A.--New Diagnosis Codes and Table 6B.--New Procedure Codes
associated with the final rule for that fiscal year. Accordingly, the
MS-DRG assignment for any new procedure codes describing PZ, if
finalized following the March meeting, would be reflected in Table
6B.--New Procedure Codes associated with the final rule for FY 2025. As
noted in prior rulemaking (87 FR 28135), the codes that are finalized
after the March meeting are specifically identified with a footnote in
Table 6A.--New Diagnosis Codes and Table 6B.--New Procedure Codes that
are made publicly available in association with the final rule on the
CMS website at <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps</a>. The public may provide feedback on
these finalized assignments, which is then taken into consideration for
the following fiscal year.
We do not agree with the request to revise the title for Pre-MDC
MS-DRG 018 for FY 2025 as requested because the logic for Pre-MDC MS-
DRG 018 is intended to include other immunotherapies and is not
restricted to CAR T-cell and autologous gene and cell therapies. As
discussed in the FY 2022 IPPS/LTCH PPS final rule (86 FR 44798 through
44806), we finalized our proposal to revise the title of Pre-MDC MS-DRG
018 to include ``Other Immunotherapies'' to better reflect the cases
reporting the administration of non-CAR T-cell therapies and other
immunotherapies that would also be assigned to this MS-DRG, in addition
to CAR T-cell therapies. We noted that the term ``Other
Immunotherapies'' is intended to encompass the group of therapies that
are currently available and being utilized today (for which codes have
been created for reporting in response to industry requests or are
being considered for implementation), and to enable appropriate MS-DRG
assignment for any future therapies that may also fit into this
category and are not specifically identified as a CAR T-cell product,
that may become available (for example receive marketing authorization
or a newly established procedure code in the ICD-10-PCS
classification).
We also note, as discussed in prior rulemaking, that this category
of therapies continues to evolve, and we are in the process of
carefully considering the feedback we have previously received about
ways in which we can continue to appropriately reflect resource
utilization while maintaining clinical coherence and stability in the
relative weights under the IPPS MS-DRGs. We appreciate the
recommendations and suggestions for consideration we have received and
will continue to examine these complex issues in connection with future
rulemaking. We acknowledge that there may be distinctions to account
for as we continue to gain more experience in the use of these
therapies and have additional claims data to analyze. Therefore, we are
not proposing to revise the title for Pre-MDC MS-DRG 018 to reflect
``Chimeric Antigen Receptor (CAR) T and Other Autologous Gene and Cell
Therapies'' at this time and are proposing to maintain the existing
title to Pre-MDC MS-DRG 018, ``Chimeric Antigen Receptor (CAR) T-cell
and Other Immunotherapies'' for FY 2025.
3. MDC 01 (Diseases and Disorders of the Nervous System)
a. Logic for MS-DRGs 023 Through 027
In the FY 2024 IPPS/LTCH PPS final rule (88 FR 58661 through
58667), we discussed a request to reassign cases describing the
insertion of a neurostimulator generator into the skull in combination
with the insertion of a neurostimulator lead into the brain from MS-DRG
023 (Craniotomy with Major Device Implant or Acute Complex CNS
Principal Diagnosis with MCC or Chemotherapy Implant or Epilepsy with
Neurostimulator) to MS-DRG 021 (Intracranial Vascular Procedures with
Principal Diagnosis Hemorrhage with CC) or reassign all cases currently
assigned to MS-DRG 023 that involve a craniectomy or a craniotomy with
the insertion of device implant and create a new MS-DRG for these
cases.
We stated the requestor acknowledged that the relatively low volume
of cases that only involve the insertion of a neurostimulator generator
into the skull in combination with the insertion of a neurostimulator
lead into the brain in the claims data was likely not sufficient to
warrant the creation of a new MS-DRG. The requestor further stated
given the limited options within the existing MS-DRG structure that fit
from both a cost and clinical cohesiveness perspective, they believed
that MS-DRG 021 was the most logical fit in terms of average costs and
clinical coherence for reassignment even though, according to the
requestor, the insertion of a neurostimulator generator into the skull
in combination with the insertion of a neurostimulator lead into the
brain is technically more complex and involves a higher level of
training, extreme precision and sophisticated technology than
performing a craniectomy for hemorrhage.
We noted that while our data findings demonstrated the average
costs are higher for the cases with a principal diagnosis of epilepsy
with a neurostimulator generator inserted into the skull and insertion
of a neurostimulator lead into brain when compared to all cases in MS-
DRG 023, these cases represented a small percentage of the total number
of cases reported in this MS-DRG. We stated that while we appreciated
the requestor's concerns regarding the differential in average costs
for cases describing the insertion of a neurostimulator generator into
the skull in combination with the insertion of a neurostimulator lead
into the brain when compared to all cases in their assigned MS-DRG, we
believed additional time was needed to evaluate these cases as part of
our ongoing examination of the case logic to the MS-DRGs for craniotomy
and endovascular procedures, which are MS-DRG 023, MS-DRG 024
(Craniotomy with Major Device Implant or Acute Complex CNS Principal
Diagnosis without MCC), and MS-DRGs 025, 026, and 027 (Craniotomy and
Endovascular Intracranial Procedures with MCC, with CC, and without CC/
MCC, respectively).
As discussed in the FY 2023 IPPS/LTCH PPS final rule (87 FR 48808
through 48820), in connection with our analysis of cases reporting
laser interstitial thermal therapy (LITT) procedures performed on the
brain or brain stem in MDC 01, we stated we have started to examine the
logic for case assignment to MS-DRGs 023 through 027 to determine where
further refinements could potentially be made to better account for
differences in the technical complexity and resource utilization among
the procedures that are currently assigned to those MS-DRGs. We stated
that specifically, we were in the process of evaluating procedures that
are performed using an open craniotomy (where it is necessary to
surgically remove a portion of the skull) versus a percutaneous burr
hole
[[Page 35953]]
(where a hole approximately the size of a pencil is drilled) to obtain
access to the brain in the performance of a procedure. We stated we
were also reviewing the indications for these procedures, for example,
malignant neoplasms versus epilepsy to consider if there may be merit
in considering restructuring the current MS-DRGs to better recognize
the clinical distinctions of these patient populations in the MS-DRGs.
As part of this evaluation, as discussed in the FY 2024 IPPS/LTCH
PPS final rule, we have begun to analyze the ICD-10 coded claims data
to determine if the patients' diagnoses, the objective of the procedure
performed, the specific anatomical site where the procedure is
performed or the surgical approach used (for example, open,
percutaneous, percutaneous endoscopic, among others) demonstrates a
greater severity of illness and/or increased treatment difficulty as we
consider restructuring MS-DRGs 023 through 027, including how to better
align the clinical indications with the performance of specific
intracranial procedures. We referred the reader to Tables 6P.2b through
6P.2f associated with the FY 2024 IPPS/LTCH PPS proposed rule
(available on the CMS website at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps</a>) for data analysis
findings of cases assigned to MS-DRGs 023 through 027 from the
September 2022 update of the FY 2022 MedPAR file as we continue to look
for patterns of complexity and resource intensity.
In summary, we stated that while we agreed that neurostimulator
cases can have average costs that are higher than the average costs of
all cases in their respective MS-DRGs, in our analysis of this issue,
it was difficult to detect patterns of complexity and resource
intensity. Therefore, for the reasons discussed, we finalized our
proposal to maintain the current assignment of cases describing a
neurostimulator generator inserted into the skull with the insertion of
a neurostimulator lead into the brain for FY 2024.
In the FY 2024 IPPS/LTCH PPS final rule, we stated we continue to
believe that additional time is needed to evaluate these cases as part
of our ongoing examination of the case logic for MS-DRGs 023 through
027. As part of our ongoing, comprehensive analysis of the MS-DRGs
under ICD-10, we stated we would continue to explore mechanisms to
ensure clinical coherence between these cases and the other cases with
which they may potentially be grouped. We stated that the data analysis
as displayed in Tables 6P.2b through 6P.2f associated with the FY 2024
IPPS/LTCH PPS proposed rule was displayed to provide the public an
opportunity to review our examination of the procedures by their
approach (open versus percutaneous), clinical indications, and
procedures that involve the insertion or implantation of a device and
to reflect on what factors should be considered in the potential
restructuring of these MS-DRGs. We welcomed further feedback on how CMS
should define technical complexity, what factors should be considered
in the analysis, and whether there are other data not included in
Tables 6P.2b through 6P.2f that CMS should analyze. We also stated we
are interested in receiving feedback on where further refinements could
potentially be made to better account for differences in the technical
complexity and resource utilization among the procedures that are
currently assigned to these MS-DRGs.
In response to this discussion in the FY 2024 IPPS/LTCH PPS final
rule, we received two comments by the October 20, 2023 deadline. A
commenter recommended that CMS not use surgical approach (for example,
open versus percutaneous) as a factor to reclassify MS-DRGs 023 through
027. The commenter stated whether the opening is created via a drill
into the skull percutaneously or through a larger incision in the skull
for a craniotomy, both approaches involve the risk of intracranial
bleeding, infection, and brain swelling. The commenter further stated
they do not support a consideration of the reassignment of the ICD-10-
PCS procedure codes describing LITT, currently assigned to MS-DRGs 025
through 027, based on the diagnosis being treated. The commenter stated
that the LITT procedure requires the same steps, time, and clinical
resources when performed for brain cancer or epilepsy. In the
requestor's view, differences in the disease causing the tumors or
lesions do not affect the resources used for performing the procedure
or the post-operative care for the patient. Lastly, the commenter
stated they support the current structure of MS-DRGs 023 and 024 based
on an acute complicated principal diagnosis, or chemotherapy implant,
or epilepsy with neurostimulator. The commenter stated these diagnoses
represent severe complex conditions that require immediate and urgent
intervention.
Another commenter stated that the current logic for MS-DRGs 023
through 027 is sufficient and supports the clinical and resource
similarities of the procedures reflected in these MS-DRGs. The
commenter performed its own analysis and stated they found that
realignment based on surgical approach or root operation could create
significant new inequities. The commenter recommended that CMS maintain
the current logic for MS-DRGs 025 through 027, as making changes could
be disruptive to hospitals and create challenges for Medicare
beneficiary access to life-saving technologies. The commenter stated
they strongly believe that maintaining the current structure provides
payment stability and integrity of these procedures over time.
CMS appreciates the comments submitted in response to the request
for feedback in the FY 2024 IPPS/LTCH PPS final rule. As we continue
analysis of the claims data with respect to MS-DRGs 023 through 027, we
continue to seek public comments and feedback on other factors that
should be considered in the potential restructuring of these MS-DRGs.
As stated in prior rulemaking, we recognize the logic for MS-DRGs 023
through 027 has grown more complex over the years and believe there is
opportunity for further refinement. We refer the reader to the ICD-10
MS-DRG Definitions Manual, Version 41.1 (available on the CMS website
at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software</a>) for complete
documentation of the GROUPER logic for MS-DRGs 023 through 027.
Feedback and other suggestions may continue to be directed to
MEARIS<SUP>TM</SUP>, discussed in section II.C.1.b. of the preamble of
this proposed rule at: <a href="https://mearis.cms.gov/public/home">https://mearis.cms.gov/public/home</a>.
b. Intraoperative Radiation Therapy (IORT)
We received a request to add ICD-10-PCS procedure codes D0Y0CZZ
(Intraoperative radiation therapy (IORT) of brain) and D0Y1CZZ
(Intraoperative radiation therapy (IORT) of brain stem), to the
Chemotherapy Implant logic list in MS-DRG 023 (Craniotomy with Major
Device Implant or Acute Complex CNS Principal Diagnosis with MCC or
Chemotherapy Implant or Epilepsy with Neurostimulator). According to
the requestor, intraoperative radiation therapy (IORT) for the brain is
always performed as part of the surgery to remove a brain tumor during
the same operative episode. The requestor stated that once maximal safe
tumor resection is achieved, the tumor cavity is examined for active
egress of cerebrospinal fluid or bleeding. Next,
[[Page 35954]]
intraoperative measurements are made using neuro-navigation or
intraoperative imaging such as magnetic resonance imaging (MRI) or
computed tomography (CT) to ensure safe distance to organs or tissues
at risk, aid in appropriate dose calculation, and selection of proper
applicator size. The applicator is then implanted into the tumor cavity
and the radiation dose is delivered. The requestor stated that delivery
time can be up to 40 minutes and upon completion of the treatment, the
source is removed, and the cavity is re-inspected for active egress of
cerebrospinal fluid and bleeding.
The requestor stated that currently the ICD-10-PCS procedure codes
for excision of a brain tumor, 00B00ZZ (Excision of brain, open
approach) and 00B70ZZ (Excision of cerebral hemisphere, open approach)
map to both sets of craniotomy MS-DRGs. Specifically, MS-DRG 023
(Craniotomy with Major Device Implant or Acute Complex CNS Principal
Diagnosis with MCC or Chemotherapy Implant or Epilepsy with
Neurostimulator) and MS-DRG 024 (Craniotomy with Major Device Implant
or Acute Complex CNS Principal Diagnosis without MCC), and MS-DRGs 025,
026, and 027 (Craniotomy and Endovascular Intracranial Procedures with
MCC, with CC, and without CC/MCC, respectively). However, the requestor
also stated that the procedure codes describing IORT (D0Y0CZZ or
D0Y1CZZ) are not listed in the GROUPER logic and do not affect MS-DRG
assignment. Therefore, cases reporting a procedure code describing
excision of a brain tumor (00B00ZZ or 00B70ZZ) with IORT currently map
to MS-DRGs 025, 026, and 027. The requestor suggested that cases
reporting a procedure code describing excision of a brain tumor
(00B00ZZ or 00B70ZZ) with IORT (D0Y0CZZ or D0Y1CZZ) should map to MS-
DRG 023 because of the higher costs associated with the addition of
IORT to the excision of brain tumor surgery. According to the
requestor, MS-DRG 023 includes complicated craniotomy cases involving
the placement of radiological sources and chemotherapy implants. The
requestor stated that because IORT involves a full course of radiation
therapy delivered directly to the tumor bed via an applicator that is
implanted into the tumor cavity during the same surgical session and is
clinically similar to two other procedures listed in the Chemotherapy
Implant logic list, it should also be included in the Chemotherapy
Implant logic list. Specifically, the requestor stated procedure code
00H004Z (Insertion of radioactive element, cesium-131 collagen implant
into brain, open approach) and procedure code 3E0Q305 (Introduction of
other antineoplastic into cranial cavity and brain, percutaneous
approach) also involve the delivery of either radiation or chemotherapy
directly after tumor resection. According to the requestor, the
resources involved in placing the delivery device are similar for all
three procedures and the distinction is that the procedures described
by codes 00H004Z and 3E0Q305 involve the insertion of devices that
deliver radiation or chemotherapy over a period of time, whereas IORT
delivers the entire dose of radiation during the operative session. As
such, the requestor asserted that IORT is clinically aligned with the
other procedures from a therapeutic and resource utilization
perspective.
The requestor performed its own analysis using the FY 2022 MedPAR
file that was made available in association with the FY 2024 IPPS/LTCH
PPS final rule and stated it found fewer than 11 cases reporting IORT
in MS-DRGs 025, 026, and 027, with the majority of those cases mapping
to MS-DRG 025. According to the requestor, the volume of claims
reporting IORT is anticipated to increase as appropriate use of the
technology is adopted.
The requestor is correct that currently, the logic for case
assignment to MS-DRG 023 includes a Chemotherapy Implant logic list and
the procedure codes that identify IORT (D0Y0CZZ and D0Y1CZZ) are not
listed in the GROUPER logic and do not affect MS-DRG assignment as the
procedures are designated as non-O.R. procedures. The requestor is also
correct that cases reporting a procedure code describing excision of a
brain tumor (00B00ZZ or 00B70ZZ) with IORT currently map to MS-DRGs
025, 026, and 027. We refer the reader to the ICD-10 MS-DRG Definitions
Manual Version 41.1 (available on the CMS website at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software</a>) for complete
documentation of the GROUPER logic.
In review of this request, we analyzed claims data from the
September 2023 update of the FY 2023 MedPAR file for MS-DRGs 023, 024,
025, 026, and 027 and for cases reporting excision of brain tumor and
IORT. We identified claims reporting excision of brain tumor with
procedure code 00B00ZZ or 00B70ZZ and identified claims reporting IORT
with procedure code D0Y0CZZ or D0Y1CZZ. The findings from our analysis
are shown in the following table. We note that there were no cases
found to report IORT of brain (D0Y0CZZ) or brain stem (D0Y1CZZ) with
excision of brain (00B00ZZ) or excision of cerebral hemisphere
(00B70ZZ).
BILLING CODE 4120-01-P
[[Page 35955]]
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[[Page 35956]]
[GRAPHIC] [TIFF OMITTED] TP02MY24.004
BILLING CODE 4120-01-C
As the data show, there were no cases found to report the use of
IORT in the performance of a brain tumor excision; therefore, we are
unable to evaluate whether the use of IORT directly impacts resource
utilization. For this reason, we are proposing to maintain the current
structure of MS-DRGs 023, 024, 025, 026, and 027 for FY 2025. We will
continue to monitor the claims data in consideration of any future
modifications to the MS-DRGs for which IORT may be reported.
4. MDC 05 (Diseases and Disorders of the Circulatory System)
a. Concomitant Left Atrial Appendage Closure and Cardiac Ablation
We received a request to create a new MS-DRG to better accommodate
the costs of concomitant left atrial appendage closure and cardiac
ablation for atrial fibrillation in MDC 05 (Diseases and Disorders of
the Circulatory System). Atrial fibrillation (AF) is an irregular and
often rapid heart rate that occurs when the two upper chambers of the
heart experience chaotic electrical signals. AF presents as either
paroxysmal (lasting <7 days), persistent (lasting >7 day, but less than
1 year), or long standing persistent (chronic) (lasting >1 year) based
on time duration and can increase the risk for stroke, heart failure,
and mortality. Management of AF has two primary goals: optimizing
cardiac output through rhythm or rate control and decreasing the risk
of cerebral and systemic thromboembolism. Among patients with AF,
thrombus in the left atrial appendage (LAA) is a primary source for
thromboembolism. Left Atrial Appendage Closure (LAAC) is a surgical or
minimally invasive procedure to seal off the LAA to reduce the risk of
embolic stroke.
According to the requestor, the manufacturer of the
WATCHMAN<SUP>TM</SUP> Left Atrial Appendage Closure (LAAC) device,
patients who are indicated for a LAAC device can also have symptomatic
AF. For these patients, performing a cardiac ablation and LAAC
procedure at the same time is ideal. Cardiac ablation is a procedure
that works by burning or freezing tissue on the inside of the heart to
disrupt faulty electrical signals causing the arrhythmia, which can
help the heart maintain a normal heart rhythm. The requestor
highlighted a recent study (Piccini et al. Left atrial appendage
occlusion with the WATCHMAN<SUP>TM</SUP> FLX and concomitant catheter
ablation procedures. Heart Rhythm Society Meeting 2023, May 19, 2023;
New Orleans, LA.). According to the requestor, the results of this
study indicate that when LAAC is performed concomitantly with cardiac
ablation, the outcomes are comparable to patients who have undergone
these procedures separately.
[[Page 35957]]
The requestor identified the following potential procedure code
combination that would comprise a concomitant left atrial appendage
closure and cardiac ablation procedure: ICD-10-PCS procedure code
02L73DK (Occlusion of left atrial appendage with intraluminal device,
percutaneous approach), that identifies the WATCHMAN<SUP>TM</SUP>
device, in combination with 02583ZZ (Destruction of conduction
mechanism, percutaneous approach). The requestor performed its own
analysis of this procedure code combination and stated that it found
the average costs of cases reporting concomitant left atrial appendage
closure and cardiac ablation procedures were consistently higher
compared to the average costs of other cases within their respective
MS-DRG, which it asserted could limit beneficiary access to these
procedures. The requestor asserted that improved Medicare payment for
providers who perform these procedures concomitantly would help
Medicare patients to gain better access to these lifesaving and
quality-improving services and decrease the risk of future readmissions
and the need for future procedures.
We reviewed this request and noted concerns regarding making
proposed MS-DRG changes based on a specific, single technology (the
WATCHMAN<SUP>TM</SUP> Left Atrial Appendage Closure (LAAC) device)
identified by only one unique procedure code versus considering
proposed changes based on a group of related procedure codes that can
be reported to describe the same type or class of technology, which is
more consistent with the intent of the MS-DRGs. Therefore, in reviewing
this request, we identified eight additional ICD-10-PCS procedure codes
that describe LAAC procedures and included these codes in our analysis.
The nine codes we identified are listed in the following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.005
Similarly, as noted previously, the requestor identified code
02583ZZ (Destruction of conduction mechanism, percutaneous approach) to
describe cardiac ablation. In our review of the ICD-10-PCS
classification, we identified 26 additional ICD-10-PCS codes that
describe cardiac ablation that we also examined. The 27 codes we
included in our analysis are listed in the following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.006
[[Page 35958]]
In the ICD-10 MS-DRGs Definitions Manual Version 41.1, for
concomitant left atrial appendage closure and cardiac ablation
procedures, the GROUPER logic assigns MS-DRGs 273 and 274 (Percutaneous
and Other Intracardiac Procedures with and without MCC, respectively)
depending on the presence of any additional MCC secondary diagnoses. We
examined claims data from the September 2023 update of the FY 2023
MedPAR file for all cases in MS-DRGs 273 and 274 and compared the
results to cases reporting procedure codes describing concomitant left
atrial appendage closure and cardiac ablation. Our findings are shown
in the following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.007
As shown in the table, in MS-DRG 273, we identified a total of
7,250 cases with an average length of stay of 5.4 days and average
costs of $35,197. Of those 7,250 cases, there were 80 cases reporting
procedure codes describing concomitant left atrial appendage closure
and cardiac ablation with average costs higher than the average costs
in the FY 2023 MedPAR file for MS-DRG 273 ($70,447 compared to $35,197)
and a slightly longer average length of stay (5.8 days compared to 5.4
days). In MS-DRG 274, we identified a total of 47,801 cases with an
average length of stay of 1.4 days and average costs of $29,209. Of
those 47,801 cases, there were 781 cases reporting procedure codes
describing concomitant left atrial appendage closure and cardiac
ablation, with average costs higher than the average costs in the FY
2023 MedPAR file for MS-DRG 274 ($66,277 compared to $29,209) and a
slightly longer average length of stay (1.5 days compared to 1.4 days).
We reviewed these data and note, clinically, the management of AF
by performing concomitant left atrial appendage closure and cardiac
ablation can improve symptoms, prevent stroke, and reduce the risk of
bleeding compared with oral anticoagulants. The data analysis clearly
shows that cases reporting concomitant left atrial appendage closure
and cardiac ablation procedures have higher average costs and slightly
longer lengths of stay compared to all the cases in their assigned MS-
DRG. For these reasons, we are proposing to create a new MS-DRG for
cases reporting a LAAC procedure and a cardiac ablation procedure.
To compare and analyze the impact of our suggested modifications,
we ran a simulation using the claims data from the September 2023
update of the FY 2023 MedPAR file. The following table illustrates our
findings for all 1,723 cases reporting procedure codes describing
concomitant left atrial appendage closure and cardiac ablation. We
believe the resulting proposed MS-DRG assignment is more clinically
homogeneous, coherent and better reflects hospital resource use.
[GRAPHIC] [TIFF OMITTED] TP02MY24.008
We applied the criteria to create subgroups in a base MS-DRG as
discussed in section II.C.1.b. of this FY 2025 IPPS/LTCH PPS proposed
rule. As shown in the table that follows, a three-way split of the
proposed new MS-DRGs failed the criterion that there be at least 500
cases for each subgroup due to low volume. Specifically, for the ``with
MCC'' split, there were only 268 cases in the subgroup.
[GRAPHIC] [TIFF OMITTED] TP02MY24.009
We then applied the criteria for a two-way split for the ``with CC/
MCC'' and ``without CC/MCC'' subgroups and found that the criterion
that there be at least a 20% difference in average cost between
subgroups could not be met. The following table illustrates our
findings.
[GRAPHIC] [TIFF OMITTED] TP02MY24.010
[[Page 35959]]
We also applied the criteria for a two-way split for the ``with
MCC'' and ``without MCC'' subgroups and found that the criterion that
there be at least 500 or more cases in each subgroup similarly could
not be met. The criterion that there be at least a 20% difference in
average costs between the subgroups also was not met. The following
table illustrates our findings.
[GRAPHIC] [TIFF OMITTED] TP02MY24.011
Therefore, for FY 2025, we are not proposing to subdivide the
proposed new MS-DRG for cases reporting procedure codes describing
concomitant left atrial appendage closure and cardiac ablation into
severity levels.
In summary, for FY 2025, taking into consideration that it
clinically requires greater resources to perform concomitant left
atrial appendage closure and cardiac ablation procedures, we are
proposing to create a new base MS-DRG for cases reporting a LAAC
procedure and a cardiac ablation procedure in MDC 05. The proposed new
MS-DRG is proposed new MS-DRG 317 (Concomitant Left Atrial Appendage
Closure and Cardiac Ablation). We are also proposing to include the
nine ICD-10-PCS procedure codes that describe LAAC procedures and 27
ICD-10-PCS procedure codes that describe cardiac ablation listed
previously in the logic for assignment of cases reporting a LAAC
procedure and a cardiac ablation procedure for the proposed new MS-DRG.
We note that discussion of the surgical hierarchy for the proposed
modification is discussed in section II.C.15. of this proposed rule.
b. Neuromodulation Device Implant for Heart Failure
(Barostim<SUP>TM</SUP> Baroreflex Activation Therapy)
The BAROSTIM<SUP>TM</SUP> system is the first neuromodulation
device system designed to trigger the body's main cardiovascular reflex
to target symptoms of heart failure. The system consists of an
implantable pulse generator (IPG) that is implanted subcutaneously in
the upper chest below the clavicle, a stimulation lead that is sutured
to either the right or left carotid sinus to activate the baroreceptors
in the wall of the carotid artery, and a wireless programmer system
that is used to non-invasively program and adjust BAROSTIM<SUP>TM</SUP>
therapy via telemetry. The BAROSTIM<SUP>TM</SUP> system is indicated
for the improvement of symptoms of heart failure in a subset of
patients with symptomatic New York Heart Association (NYHA) Class III
or Class II (who had a recent history of Class III) heart failure, with
a low left ventricular ejection fraction, who also do not benefit from
guideline directed pharmacologic therapy or qualify for Cardiac
Resynchronization Therapy (CRT). The BAROSTIM<SUP>TM</SUP> system was
approved for new technology add-on payments for FY 2021 (85 FR 58716
through 58717) and FY 2022 (86 FR 44974). The new technology add-on
payment was subsequently discontinued effective FY 2023 (87 FR 48916).
In the FY 2023 IPPS/LTCH PPS final rule (87 FR 48837 through
48843), we discussed a request we received to reassign the ICD-10-PCS
procedure codes that describe the implantation of the
BAROSTIM<SUP>TM</SUP> system from MS-DRGs 252, 253, and 254 (Other
Vascular Procedures with MCC, with CC, and without MCC respectively) to
MS-DRGs 222, 223, 224, 225, 226, and 227 (Cardiac Defibrillator Implant
with and without Cardiac Catheterization with and without AMI/HF/Shock
with and without MCC, respectively). The requestor stated that the
subset of patients that have an indication for the implantation of a
BAROSTIM<SUP>TM</SUP> system also have indications for the implantation
of Implantable Cardioverter Defibrillators (ICD), Cardiac
Resynchronization Therapy Defibrillators (CRT-D) and/or Cardiac
Contractility Modulation (CCM) devices, all of which also require the
permanent implantation of a programmable, electrical pulse generator
and at least one electrical lead. The requestor further stated that the
average resource utilization required to implant the
BAROSTIM<SUP>TM</SUP> system demonstrates a significant disparity
compared to all procedures within MS-DRGs 252, 253, and 254.
In the FY 2023 IPPS/LTCH PPS final rule, we stated that the results
of the claims analysis demonstrated we did not have sufficient claims
data on which to base and evaluate any proposed changes to the current
MS-DRG assignment. We also expressed concern in equating the
implantation of a BAROSTIM<SUP>TM</SUP> system to the placement of ICD,
CRT-D, and CCM devices as these devices all differ in terms of
technical complexity and anatomical placement of the electrical
lead(s). We noted there is no intravascular component or vascular
puncture involved when implanting a BAROSTIM<SUP>TM</SUP> system. In
contrast, the placement of ICD, CRT-D, and CCM devices generally
involve a lead being affixed to the myocardium, being threaded through
the coronary sinus or crossing a heart valve and are procedures that
involve a greater level of complexity than affixing the stimulator lead
to either the right or left carotid sinus when implanting a
BAROSTIM<SUP>TM</SUP> system. We stated that we believed that as the
number of cases reporting procedure codes describing the implantation
of neuromodulation devices for heart failure increases, a better view
of the associated costs and lengths of stay on average will be
reflected in the data for purposes of assessing any reassignment of
these cases. Therefore, after consideration of the public comments we
received, and for the reasons stated earlier, we finalized our proposal
to maintain the assignment of cases reporting procedure codes that
describe the implantation of a neuromodulation device in MS-DRGs 252,
253, and 254 for FY 2023.
In the FY 2024 IPPS/LTCH PPS final rule (88 FR 58712 through
58720), we discussed a request we received to add ICD-10-CM diagnosis
code R57.0 (Cardiogenic shock) to the list of ``secondary diagnoses''
that grouped to MS-DRGs 222 and 223 (Cardiac Defibrillator Implant with
Cardiac Catheterization with Acute Myocardial Infarction (AMI), Heart
Failure (HF), or Shock with and without MCC, respectively). During our
review of the issue, we noted that the results of our claims analysis
showed that in procedures involving a cardiac defibrillator implant,
the average costs and length of stay were generally similar without
regard to the presence of diagnosis codes describing AMI, HF, or shock.
We stated we believed that it may no longer be necessary to subdivide
MS-DRGs 222, 223, 224, 225, 226, and 227 based on the diagnosis codes
reported. After consideration of the public comments we received, and
for the reasons stated in the rule, we finalized our proposal to delete
MS-
[[Page 35960]]
DRGs 222, 223, 224, 225, 226, and 227. We also finalized our proposal
to create new MS-DRG 275 (Cardiac Defibrillator Implant with Cardiac
Catheterization and MCC), new MS-DRG 276 (Cardiac Defibrillator Implant
with MCC) and new MS-DRG 277 (Cardiac Defibrillator Implant without
MCC) in MDC 05 for FY 2024.
For this FY 2025 IPPS/LTCH PPS proposed rule, we received a similar
request to again review the MS-DRG assignment of the ICD-10-PCS
procedure codes that describe the implantation of the
BAROSTIM<SUP>TM</SUP> system. Specifically, the requestor recommended
that CMS consider reassigning the ICD-10-PCS procedure codes that
describe the implantation of the BAROSTIM<SUP>TM</SUP> system from MS-
DRGs 252, 253, and 254 (Other Vascular Procedures with MCC, with CC,
and without MCC respectively) to MS-DRGs 275 (Cardiac Defibrillator
Implant with Cardiac Catheterization and MCC), MS-DRG 276, and 277
(Cardiac Defibrillator Implant with MCC and without MCC respectively);
or to other more clinically coherent MS-DRGs for implantable device
procedures indicated for Class III heart failure patients. The
requestor stated in their analysis the number of claims reporting
procedure codes that describe the implantation of the
BAROSTIM<SUP>TM</SUP> system has been consistently growing over the
past few years. The requestor acknowledged that the implantation of the
BAROSTIM<SUP>TM</SUP> system is predominantly performed in the
outpatient setting but noted that a significant number of severely sick
patients with multiple comorbidities (such as chronic kidney disease,
end stage renal disease (ESRD), chronic obstructive pulmonary disease
(COPD), and AF) are treated in an inpatient setting. The requestor
stated in their experience, hospitals that have performed
BAROSTIM<SUP>TM</SUP> procedures have stopped allowing patients to
receive the device in the inpatient setting due to the high losses for
each Medicare claim. The requestor asserted it is critically important
to allow very sick and fragile patients access to the
BAROSTIM<SUP>TM</SUP> procedure in an inpatient setting and stated
these patients should not be denied access by hospitals due to the
perceived gross underpayment of the current MS-DRG.
The requestor stated the BAROSTIM<SUP>TM</SUP> procedure is not
clinically coherent with other procedures assigned to MS-DRGs 252, 253,
and 254 (Other Vascular Procedures) as the majority of the ICD-10-PCS
codes assigned to MS-DRGs 252, 253, and 254 describe procedures to
identify, diagnose, clear and restructure veins and arteries, excluding
those that require implantable devices. Furthermore, the requestor
stated the costs of the implantable medical devices used for the
BAROSTIM<SUP>TM</SUP> system (that is, the electrical pulse generator
and electrical lead) alone far exceed the average costs of other cases
assigned to MS-DRGs 252, 253, and 254.
The following ICD-10-PCS procedure codes uniquely identify the
implantation of the BAROSTIM<SUP>TM</SUP> system: 0JH60MZ (Insertion of
stimulator generator into chest subcutaneous tissue and fascia, open
approach) in combination with 03HK3MZ (Insertion of stimulator lead
into right internal carotid artery, percutaneous approach) or 03HL3MZ
(Insertion of stimulator lead into left internal carotid artery,
percutaneous approach).
To analyze this request, we first examined claims data from the
September 2023 update of the FY 2023 MedPAR file for MS-DRGs 252, 253,
and 254 to identify cases reporting procedure codes describing the
implantation of the BAROSTIM<SUP>TM</SUP> system with or without a
procedure code describing the performance of a cardiac catheterization
as MS-DRG 275 is defined by the performance of cardiac catheterization
and a secondary diagnosis of MCC. Our findings are shown in the
following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.012
As shown in the table, in MS-DRG 252, we identified a total of
18,964 cases with an average length of stay of 8 days and average costs
of $30,456. Of those 18,964 cases, there was one case reporting
procedure codes describing
[[Page 35961]]
the implantation of the BAROSTIM<SUP>TM</SUP> system with a procedure
code describing the performance of a cardiac catheterization with costs
higher than the average costs in the FY 2023 MedPAR file for MS-DRG 252
($110,928 compared to $30,456) and a longer length of stay (9 days
compared to 8 days). There were 12 cases reporting procedure codes
describing the implantation of the BAROSTIM<SUP>TM</SUP> system without
a procedure code describing the performance of a cardiac
catheterization, with average costs higher than the average costs in
the FY 2023 MedPAR file for MS-DRG 252 ($66,291 compared to $30,456)
and a slighter shorter average length of stay (7.8 days compared to 8
days). In MS-DRG 253, we identified a total of 15,551 cases with an
average length of stay of 5.2 days and average costs of $22,870. Of
those 15,551 cases, there were seven cases reporting procedure codes
describing the implantation of the BAROSTIM<SUP>TM</SUP> system without
a procedure code describing the performance of a cardiac
catheterization, with average costs higher than the average costs in
the FY 2023 MedPAR file for MS-DRG 253 ($52,788 compared to $22,870)
and a shorter average length of stay (4 days compared to 5.2 days). We
found zero cases in MS-DRG 253 reporting procedure codes describing the
implantation of a BAROSTIM<SUP>TM</SUP> system with a procedure code
describing the performance of a cardiac catheterization. In MS-DRG 254,
we identified a total of 5,973 cases with an average length of stay of
2.3 days and average costs of $15,778. Of those 5,973 cases, there were
three cases reporting procedure codes describing the implantation of
the BAROSTIM<SUP>TM</SUP> system without a procedure code describing
the performance of a cardiac catheterization, with average costs higher
than the average costs in the FY 2023 MedPAR file for MS-DRG 254
($29,740 compared to $15,778) and a shorter average length of stay (1.3
days compared to 2.3 days). We found zero cases in MS-DRG 254 reporting
procedure codes describing the implantation of a BAROSTIM<SUP>TM</SUP>
system with a procedure code describing the performance of a cardiac
catheterization.
We then examined claims data from the September 2023 update of the
FY 2023 MedPAR file for MS-DRGs 275, 276, and 277. Our findings are
shown in the following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.013
As the table shows, for MS-DRG 275, there were a total of 3,358
cases with an average length of stay of 10.3 days and average costs of
$63,181. For MS-DRG 276, there were a total of 3,264 cases with an
average length of stay of 8.2 days and average costs of $54,993. For
MS-DRG 277, there were a total of 3,840 cases with an average length of
stay of 4.2 days and average costs of $42,111.
In exploring mechanisms to address this request, we noted in total,
there were only 23 cases reporting procedure codes describing the
implantation of a BAROSTIM<SUP>TM</SUP> system in MS-DRGs 252, 253, and
254 (13, 7, and 3, respectively). We reviewed these data, and while we
recognize that the average costs of the 23 cases reporting procedure
codes describing the implantation of a BAROSTIM<SUP>TM</SUP> are
greater when compared to the average costs of all cases in MS-DRGs 252,
253, and 254, the number of cases continues to be too small to warrant
the creation of a new MS-DRG for these cases.
We further note, that of the 23 cases reporting procedure codes
describing the implantation of a BAROSTIM<SUP>TM</SUP> system
identified in MS-DRGs 252, 253, and 254, only one case reported the
performance of cardiac catheterization. As discussed in the FY 2024
IPPS/LTCH PPS final rule, when reviewing the consumption of hospital
resources for the cases reporting a cardiac defibrillator implant with
cardiac catheterization during a hospital stay, the claims data clearly
showed that the cases reporting secondary diagnoses designated as MCCs
were more resource intensive as compared to other cases reporting
cardiac defibrillator implant. Therefore, we finalized the creation of
MS-DRG 275 for cases reporting a cardiac defibrillator implant with
cardiac catheterization and a secondary diagnosis designated as an MCC.
Of the 23 cases reporting procedure codes describing the implantation
of a BAROSTIM<SUP>TM</SUP> system, there was only one case reporting a
procedure code describing the performance of cardiac catheterization
and a secondary diagnosis designated as an MCC, and we note that there
may have been other factors contributing to the higher costs of this
one case. The results of the claims analysis demonstrate we do not have
sufficient claims data on which to base and propose a change to the
current MS-DRG assignment of cases reporting procedure codes describing
the implantation of a BAROSTIM<SUP>TM</SUP> system from MS-DRGs 252,
253, and 254 to MS-DRG 275.
Further analysis of the claims data demonstrates that the 23 cases
reporting procedure codes describing the implantation of a
BAROSTIM<SUP>TM</SUP> system had an average length of stay of 5.8 days
and average costs of $59,355, as compared to the 3,264 cases in MS-DRG
276 that had an average length of stay of 8.2 days and average costs of
$54,993. While the cases reporting procedure codes describing the
implantation of a BAROSTIM<SUP>TM</SUP> system had average costs that
were $4,362 higher than the average costs of all cases in MS-DRG 276,
as noted, there were only a total of 23 cases, and there may have been
other factors contributing to the higher costs. We noted, however,
reassigning all cases reporting procedure codes describing the
implantation of a BAROSTIM<SUP>TM</SUP> system to MS-DRG 276, even if
there is not a MCC present, the cases would receive higher payment and
better account for the differences in resource utilization of these
cases than in their respective MS-DRG.
We reviewed the clinical issues and the claims data, and while we
continue to note that there is no intravascular component or vascular
puncture involved when implanting a BAROSTIM<SUP>TM</SUP> system, and
that the implantation of a BAROSTIM<SUP>TM</SUP> system is
distinguishable from the placement of ICD, CRT-D, and CCM devices, as
these devices all differ in terms of technical complexity and
anatomical placement of the electrical lead(s), as discussed in the FY
2023 IPPS/LTCH PPS final rule (87 FR 48837 through 48843), we agree
that ICD, CRT-D, and CCM devices and the BAROSTIM<SUP>TM</SUP> system
are clinically coherent in that they share an indication of heart
failure, a major cause of morbidity and mortality in the United States,
and that these cases demonstrate comparable resource utilization. Based
on our review of the clinical issues and
[[Page 35962]]
the claims data, and to better account for the resources required, we
are proposing to reassign the cases reporting procedure codes
describing the implantation of a BAROSTIM<SUP>TM</SUP> system to MS-DRG
276, even if there is no MCC reported, to better reflect the clinical
severity and resource use involved in these cases.
Therefore, for FY 2025, we are proposing to reassign all cases with
one of the following ICD-10-PCS code combinations capturing cases
reporting procedure codes describing the implantation of a
BAROSTIM<SUP>TM</SUP> system, to MS-DRG 276, even if there is no MCC
reported:
<bullet> 0JH60MZ (Insertion of stimulator generator into chest
subcutaneous tissue and fascia, open approach) in combination with
03HK3MZ (Insertion of stimulator lead into right internal carotid
artery, percutaneous approach); and
<bullet> 0JH60MZ (Insertion of stimulator generator into chest
subcutaneous tissue and fascia, open approach) in combination with
03HL3MZ (Insertion of stimulator lead into left internal carotid
artery, percutaneous approach).
We also are proposing to change the title of MS-DRG 276 from
``Cardiac Defibrillator Implant with MCC'' to ``Cardiac Defibrillator
Implant with MCC or Carotid Sinus Neurostimulator'' to reflect the
proposed modifications to MS-DRG assignments. We note that discussion
of the surgical hierarchy for this proposed modification is discussed
in section II.C.15. of this proposed rule.
c. Endovascular Cardiac Valve Procedures
The human heart contains four major valves--the aortic, mitral,
pulmonary, and tricuspid valves. These valves function to keep blood
flowing through the heart. When conditions such as stenosis or
insufficiency/regurgitation occur in one or more of these valves,
valvular heart disease may result. Intervention options, including
surgical aortic valve replacement or transcatheter aortic valve
replacement can be performed to treat diseased or damaged aortic heart
valves. Surgical aortic valve replacement (SAVR) is a traditional,
open-chest surgery where an incision is made to access the heart. The
damaged valve is replaced, and the chest is surgically closed. Since
SAVR is a major surgery that involves an incision, recovery time tends
to be longer. Transcatheter aortic valve replacement (TAVR) is a
minimally invasive procedure that involves a catheter being inserted
into an artery, without an incision for most cases, and then guided to
the heart. The catheter delivers the new valve without the need for the
chest or heart to be surgically opened. Since TAVR is a non-surgical
procedure, it is generally associated with a much shorter recovery
time.
In the FY 2015 IPPS/LTCH PPS final rule (79 FR 49892 through
49893), we discussed a request we received to create a new MS-DRG that
would only include the various types of cardiac valve replacements
performed by an endovascular or transcatheter technique. We reviewed
the claims data and stated the data analysis showed that cardiac valve
replacements performed by an endovascular or transcatheter technique
had a shorter average length of stay and higher average costs in
comparison to all of the cases in their assigned MS-DRGs, which were
MS-DRGs 216, 217, 218, 219, 220, and 221 (Cardiac Valve & Other Major
Cardiothoracic Procedure with and without Cardiac Catheterization, with
MCC, with CC, and without CC/MCC, respectively). In the FY 2015 IPPS/
LTCH PPS final rule we stated that patients receiving endovascular
cardiac valve replacements were significantly different from those
patients who undergo an open chest cardiac valve replacement and noted
that patients receiving endovascular cardiac valve replacements are not
eligible for open chest cardiac valve procedures because of a variety
of health constraints, which we said highlights the fact that peri-
operative complications and post-operative morbidity have significantly
different profiles for open chest procedures compared with endovascular
interventions. We further noted that separately grouping these
endovascular valve replacement procedures provides greater clinical
cohesion for this subset of high-risk patients. Therefore, we finalized
our proposal to create MS-DRGs 266 and 267 (Endovascular Cardiac Valve
Replacement, with MCC and without MCC, respectively) for FY 2015.
In the FY 2020 IPPS/LTCH PPS final rule (84 FR 42080 through
42089), we discussed a request we received to modify the MS-DRG
assignment for transcatheter mitral valve repair (TMVR) with implant
procedures. We reviewed the claims data and stated based on our data
analysis, transcatheter cardiac valve repair procedures and
transcatheter (endovascular) cardiac valve replacement procedures are
more clinically coherent in that they describe endovascular cardiac
valve interventions with implants, and were similar in terms of average
length of stay and average costs to cases in MS-DRGs 266 and 267 when
compared to other procedures in their current MS-DRG assignment. For
the reasons described in the rule and after consideration of the public
comments we received, we finalized our proposal to modify the structure
of MS-DRGs 266 and 267 by reassigning the procedure codes that describe
transcatheter cardiac valve repair (supplement) procedures, to revise
the title of MS-DRG 266 from ``Endovascular Cardiac Valve Replacement
with MCC'' to ``Endovascular Cardiac Valve Replacement and Supplement
Procedures with MCC'' and to revise the title of MS-DRG 267 from
``Endovascular Cardiac Valve Replacement without MCC'' to
``Endovascular Cardiac Valve Replacement and Supplement Procedures
without MCC'', to reflect the finalized restructuring.
For this FY 2025 IPPS/LTCH PPS proposed rule, we received a request
to delete MS-DRGs 266 and 267 and to move the cases reporting
transcatheter aortic valve replacement or repair (supplement)
procedures currently assigned to those MS-DRGs into MS-DRGs 216, 217,
218, 219, 220, and 221. The requestor asserted that under the current
IPPS payment methodology, TAVR procedures are not profitable to
hospitals and when patients are clinically eligible for both a TAVR and
SAVR procedures, factors beyond clinical appropriateness can drive
treatment decisions. According to the requestor (the manufacturer of
the SAPIEN<SUP>TM</SUP> family of transcatheter heart valves) sharing a
single set of MS-DRGs would eliminate the current disincentives
hospitals face and create financial neutrality between the two
lifesaving treatment options. The requestor stated the current
disincentives are increasingly problematic because they contribute to
treatment disparities among certain racial, socioeconomic, and
geographic groups.
The requestor noted that currently surgical cardiac valve
replacement and supplement procedures, such as SAVR, are assigned to
MS-DRGs 216, 217, 218, 219, 220, and 221, and endovascular cardiac
valve replacement and supplement procedures, such as TAVR, are assigned
to MS-DRGs 266 and 267. The requestor stated that both sets of MS-DRGs
address valve disease and include valve repair or replacement
procedures for any of the four heart valves. According to the
requestor, while the sets of MS-DRGs involve clinically similar cases
their payment rates differ which may be unintentionally influencing
clinical decision-making by incentivizing hospitals to choose more
invasive SAVR
[[Page 35963]]
procedures over less-invasive TAVR procedures.
As mentioned earlier, the requestor recommended that CMS delete MS-
DRGs 266 and 267 and move the cases reporting transcatheter aortic
valve replacement or repair (supplement) procedures currently assigned
to those MS-DRGs into MS-DRGs 216, 217, 218, 219, 220, and 221. The
requestor performed their own analysis and stated that their models of
this suggested solution indicated the change would result in moderate
differences in per case payments by case type and would not increase
overall Medicare spending. The requestor noted that while their
requested solution would potentially decrease payment to cases
currently assigned to MS-DRGs 216, 217, 218, 219, 220, and 221, while
at the same time increasing the payment to cases reporting endovascular
cardiac valve replacement and supplement procedures, the results of
their claim analysis demonstrated that the net difference in total
payments across all cases would increase by approximately $6.5 million.
The requestor stated that they anticipate that their proposed solution
could increase Medicare patients' access to innovative endovascular
cardiac valve procedures by establishing payment neutrality between
SAVR and TAVR procedures.
We reviewed this request and note the requestor is correct that in
Version 41.1 cases reporting procedure codes that describe endovascular
cardiac valve replacement and supplement procedures, including TAVR,
group to MS-DRGs 266 and 267. The requestor is also correct that cases
reporting procedure codes that describe surgical cardiac valve
replacement and supplement procedures, including SAVR, group to MS-DRGs
216, 217, 218, 219, 220, and 221. We refer the reader to the ICD-10 MS-
DRG Definitions Manual Version 41.1 (available on the CMS website at:
<a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software</a>) for complete
documentation of the GROUPER logic for MS-DRGs 216, 217, 218, 219, 220,
221, 266 and 267.
To begin our analysis, we identified the ICD-10-PCS procedure codes
that describe endovascular (transcatheter) cardiac valve replacement
and supplement procedures and the ICD-10-PCS procedure codes that
describe surgical cardiac valve replacement and supplement procedures.
We also identified the ICD-10-PCS codes that describe cardiac
catheterization, as MS-DRGs 216, 217, and 218 (Cardiac Valve and Other
Major Cardiothoracic Procedures with Cardiac Catheterization with MCC,
with CC, and without CC/MCC, respectively) are defined by the
performance of cardiac catheterization. We refer the reader to Table
6P.2a, Table 6P.2b, and Table 6P.2c, respectively, associated with this
proposed rule (and available at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps</a>) for the lists of the
ICD-10-PCS procedure codes that we identified that describe
endovascular cardiac valve replacement and supplement procedures,
surgical cardiac valve replacement and supplement procedures, and
cardiac catheterization procedures.
We then examined the claims data from the September 2023 update of
the FY 2023 MedPAR file for all cases in MS-DRGs 216, 217, 218, 219,
220, and 221 and compared the results to cases reporting surgical
cardiac valve replacement and supplement procedures in MS-DRG 216, 217,
218, 219, 220, and 221. The following table shows our findings:
[GRAPHIC] [TIFF OMITTED] TP02MY24.014
As shown in the table, in MS-DRG 216, we identified a total of
5,033 cases with an average length of stay of 13.9 days and average
costs of $84,176. Of those 5,033 cases, there were 2,973 cases
reporting surgical cardiac valve replacement and supplement procedures,
with average costs higher than the average costs in the FY 2023 MedPAR
file for MS-DRG 216 ($87,497 compared to $84,176) and a longer average
length of stay (16.8 days
[[Page 35964]]
compared to 13.9 days). In MS-DRG 217, we identified a total of 1,635
cases with an average length of stay of 7.2 days and average costs of
$58,381. Of those 1,635 cases, there were 867 cases reporting surgical
cardiac valve replacement and supplement procedures, with average costs
lower than the average costs in the FY 2023 MedPAR file for MS-DRG 217
($56,829 compared to $58,381) and a longer average length of stay (9.5
days compared to 7.2 days). In MS-DRG 218, we identified a total of 275
cases with an average length of stay of 3.4 days and average costs of
$54,624. Of those 275 cases, there were 60 cases reporting surgical
cardiac valve replacement and supplement procedures, with average costs
lower than the average costs in the FY 2023 MedPAR file for MS-DRG 218
($45,096 compared to $54,624) and a longer average length of stay (6.7
days compared to 3.4 days). In MS-DRG 219, we identified a total of
12,458 cases with an average length of stay of 10.5 days and average
costs of $67,228. Of those 12,458 cases, there were 9,780 cases
reporting surgical cardiac valve replacement and supplement procedures,
with average costs lower than the average costs in the FY 2023 MedPAR
file for MS-DRG 219 ($64,954 compared to $67,228), and a slightly
shorter average length of stay (10.3 days compared to 10.5 days). In
MS-DRG 220, we identified a total of 9,829 cases with an average length
of stay of 6.3 days and average costs of $47,242. Of those 9,829 cases,
there were 7,841 cases reporting surgical cardiac valve replacement and
supplement procedures, with average costs lower than the average costs
in the FY 2023 MedPAR file for MS-DRG 220 ($46,245 compared to $47,242)
and a slightly longer average length of stay (6.4 days compared to 6.3
days). In MS-DRG 221, we identified a total of 1,242 cases with an
average length of stay of 3.8 days and average costs of $41,539. Of
those 1,242 cases, there were 627 cases reporting surgical cardiac
valve replacement and supplement procedures, with average costs lower
than the average costs in the FY 2023 MedPAR file for MS-DRG 221
($39,081 compared to $41,539) and a longer average length of stay (4.9
days compared to 3.8 days).
Next, we examined claims data from the September 2023 update of the
FY 2023 MedPAR file for MS-DRGs 266 and 267. Our findings are shown in
the following table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.015
Because there is a two-way split within MS-DRGs 266 and 267 and
there is a three-way split within MS-DRGs 216, 217, and 218, and MS-
DRGs 219, 220, and 221 (Cardiac Valve and Other Major Cardiothoracic
Procedures without Cardiac Catheterization with MCC, with CC, and
without CC/MCC, respectively), we also analyzed the cases reporting a
code describing an endovascular cardiac valve replacement and
supplement procedure with a procedure code describing the performance
of a cardiac catheterization for the presence or absence of a secondary
diagnosis designated as a complication or comorbidity (CC) or a major
complication or comorbidity (MCC). We also analyzed the cases reporting
a code describing an endovascular cardiac valve replacement and
supplement procedure without a procedure code describing the
performance of a cardiac catheterization for the presence or absence of
a secondary diagnosis designated as a CC or an MCC.
[GRAPHIC] [TIFF OMITTED] TP02MY24.016
As shown in the table, the data analysis performed indicates that
the 5,443 cases in MS-DRG 266 reporting endovascular cardiac valve
replacement and supplement procedures with a procedure code describing
the
[[Page 35965]]
performance of a cardiac catheterization, and with a secondary
diagnosis code designated as an MCC have an average length of stay that
is shorter than the average length of stay (7.9 days versus 16.8 days)
and lower average costs ($63,128 versus $87,497) when compared to the
cases in MS-DRG 216 reporting surgical cardiac valve replacement and
supplement procedures with a procedure code describing the performance
of a cardiac catheterization, and with a secondary diagnosis code
designated as an MCC. The 4,761 cases in MS-DRG 267 reporting
endovascular cardiac valve replacement and supplement procedures with a
procedure code describing the performance of a cardiac catheterization,
and with a secondary diagnosis code designated as a CC have an average
length of stay that is shorter than the average length of stay (2 days
versus 9.5 days) and lower average costs ($42,163 versus $56,829) when
compared to the cases in MS-DRG 217 reporting surgical cardiac valve
replacement and supplement procedures with a procedure code describing
the performance of a cardiac catheterization, and with a secondary
diagnosis code designated as an CC. The 1,386 cases in MS-DRG 267
reporting endovascular cardiac valve replacement and supplement
procedures with a procedure code describing the performance of a
cardiac catheterization, and without a secondary diagnosis code
designated as a CC or MCC have an average length of stay that is
shorter than the average length of stay (1.3 days versus 6.7 days) and
lower average costs ($39,709 versus $45,096) when compared to the cases
in MS-DRG 218 reporting surgical cardiac valve replacement and
supplement procedures with a procedure code describing the performance
of a cardiac catheterization, without a secondary diagnosis code
designated as a CC or MCC.
The 14,493 cases in MS-DRG 266 reporting endovascular cardiac valve
replacement and supplement procedures without a procedure code
describing the performance of a cardiac catheterization, and with a
secondary diagnosis code designated as an MCC have an average length of
stay that is shorter than the average length of stay (3.5 days versus
10.3 days) and lower average costs ($50,831 versus $64,954) when
compared to the cases in MS-DRG 219 reporting surgical cardiac valve
replacement and supplement procedures without a procedure code
describing the performance of a cardiac catheterization, and with a
secondary diagnosis code designated as an MCC. The 22,996 cases in MS-
DRG 267 reporting endovascular cardiac valve replacement and supplement
procedures without a procedure code describing the performance of a
cardiac catheterization, and with a secondary diagnosis code designated
as a CC have an average length of stay that is shorter than the average
length of stay (1.5 days versus 6.4 days) and lower average costs
($43,637 versus $46,245) when compared to the cases in MS-DRG 220
reporting surgical cardiac valve replacement and supplement procedures
without a procedure code describing the performance of a cardiac
catheterization, and with a secondary diagnosis code designated as an
CC. The 7,522 cases in MS-DRG 267 reporting endovascular cardiac valve
replacement and supplement procedures without a procedure code
describing the performance of a cardiac catheterization, and without a
secondary diagnosis code designated as a CC or MCC have an average
length of stay that is shorter than the average length of stay (1.2
days versus 4.9 days) and higher average costs ($42,472 versus $39,081)
when compared to the cases in MS-DRG 221 reporting surgical cardiac
valve replacement and supplement procedures without a procedure code
describing the performance of a cardiac catheterization, without a
secondary diagnosis code designated as a CC or MCC.
This data analysis shows the cases in MS-DRG 266 and 267 reporting
endovascular cardiac valve replacement and supplement procedures with a
procedure code describing the performance of a cardiac catheterization
when distributed based on the presence or absence of a secondary
diagnosis designated as a CC or a MCC have average costs lower than the
average costs of cases reporting surgical cardiac valve replacement and
supplement procedures with a procedure code describing the performance
of a cardiac catheterization in the FY 2023 MedPAR file for MS-DRGs
216, 217, and 218 respectively, and the average lengths of stay are
shorter. Similarly, the cases in MS-DRG 266 and 267 reporting
endovascular cardiac valve replacement and supplement procedures
without a procedure code describing the performance of a cardiac
catheterization when distributed based on the presence or absence of a
secondary diagnosis designated as a CC or a MCC generally have average
costs lower than the average costs of cases reporting surgical cardiac
valve replacement and supplement procedures without a procedure code
describing the performance of a cardiac catheterization in the FY 2023
MedPAR file for MS-DRGs 219, 220, and 221 respectively, and the average
lengths of stay are shorter.
For patients with an indication for cardiac valve replacement,
clinical and anatomic factors must be considered when decision-making
between procedures such as TAVR and SAVR. We note that SAVR is not a
treatment option for patients with extreme surgical risk (that is, high
probability of death or serious irreversible complication), severe
atheromatous plaques of the ascending aorta such that aortic cross-
clamping is not feasible, or with other conditions that would make
operation through sternotomy or thoracotomy prohibitively hazardous. We
agree that the endovascular or transcatheter technique presents a
viable option for high-risk patients who are not candidates for the
traditional open surgical approach, however we also note that TAVR is
not indicated for every patient. TAVR is contraindicated in patients
who cannot tolerate an anticoagulation/antiplatelet regimen, or who
have active bacterial endocarditis or other active infections, or who
have significant annuloplasty ring dehiscence.
We have concern with the assertion that clinicians perform more
invasive surgical procedures, such as SAVR procedures, only to increase
payment to their facility where minimally invasive TAVR procedures are
also viable option. The choice of SAVR versus TAVR should not be based
on potential facility payment. Instead, the decision on the procedural
approach to be utilized should be based upon an individualized risk-
benefit assessment that includes reviewing factors such as the
patient's age, surgical risk, frailty, valve morphology, and presence
of concomitant valve disease or coronary artery disease. As we have
stated in prior rulemaking (83 FR 41201), it is not appropriate for
facilities to deny treatment to beneficiaries needing a specific type
of therapy or treatment that involves increased costs. Conversely, it
is not appropriate for facilities to recommend a specific type of
therapy or treatment strictly because it may involve higher payment to
the facility.
Also, we have concern with the requestor's assertion that sharing a
single set of MS-DRGs could eliminate any perceived disincentives
hospitals may face and create financial neutrality between the two
lifesaving treatment options. Data analysis shows that cases reporting
surgical cardiac valve
[[Page 35966]]
replacement and supplement procedures have higher costs and longer
lengths of stay. If clinical decision-making is being driven by
financial motivations, as suggested by the requestor, in circumstances
where the decision on which approach is best (for example, TAVR or
SAVR) is left to the providers' discretion, it is unclear how reducing
payment for surgical cardiac valve replacement and supplement
procedures would eliminate possible disincentives, or not have the
opposite effect, and instead incentivize endovascular cardiac valve
replacement and supplement procedures.
The MS-DRGs are a classification system intended to group together
diagnoses and procedures with similar clinical characteristics and
utilization of resources and are not intended to be utilized as a tool
to incentivize the performance of certain procedures. When performed,
surgical cardiac valve replacement and supplement procedures are
clinically different from endovascular cardiac valve replacement and
supplement procedures in terms of technical complexity and hospital
resource use. In the FY 2015 IPPS/LTCH PPS final rule, we stated that
separately grouping endovascular valve replacement procedures provides
greater clinical cohesion for this subset of high-risk patients. Our
claims analysis for this FY 2025 IPPS/LTCH PPS proposed rule
demonstrates that this continues to be substantiated by the difference
in average costs and average lengths of stay demonstrated by the two
cohorts. We continue to believe that endovascular cardiac valve
replacement and supplement procedures are clinically coherent in their
currently assigned MS-DRGs. Therefore, we are proposing to maintain the
structure of MS-DRGs 266 and 267 for FY 2025.
d. MS-DRG Logic for MS-DRG 215
We received a request to review the GROUPER logic for MS-DRG 215
(Other Heart Assist System Implant) in MDC 05 (Diseases and Disorders
of the Circulatory System). The requestor stated that when the
procedure code describing the revision of malfunctioning devices within
the heart via an open approach is assigned, the encounter groups to MS-
DRG 215. The requestor stated that, in their observation, ICD-10-PCS
code 02WA0JZ (Revision of synthetic substitute in heart, open approach)
can only be assigned if a more specific anatomical site is not
documented in the operative note. The requestor further stated they
interpreted this to mean that an ICD-10-PCS procedure code describing
the open revision of a synthetic substitute in the heart can only apply
to the ventricular wall or left atrial appendage and excludes the
atrial or ventricular septum or any valve to qualify for MS-DRG 215 and
recommended that CMS consider the expansion of the open revision of
heart structures to include the atrial or ventricular septum and heart
valves.
To begin our analysis, we reviewed the GROUPER logic. The requestor
is correct that ICD-10-PCS procedure code 02WA0JZ is currently one of
the listed procedure codes in the GROUPER logic for MS-DRG 215. While
the requestor stated that when procedures codes describing the
revisions of malfunctioning devices within the heart via an open
approach are assigned, the encounter groups to MS-DRG 215, we wish to
clarify that the revision codes listed in the GROUPER logic for MS-DRG
215 specifically describe procedures to correct, to the extent
possible, a portion of a malfunctioning heart assist device or the
position of a displaced heart assist device. Further, it is unclear
what is meant by the requestor's statement that ICD-10-PCS code 02WA0JZ
can only be assigned if more specific anatomical site is not documented
in the operative note, as ICD-10-PCS code 02WA0JZ is used to describe
the open revision of artificial heart systems. Total artificial hearts
are pulsating bi-ventricular devices that are implanted into the chest
to replace a patient's left and right ventricles and can provide a
bridge to heart transplantation for patients who have no other
reasonable medical or surgical treatment options. We refer the reader
to the ICD-10 MS-DRG Definitions Manual Version 41.1 (available on the
CMS website at: <a href="https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software">https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/ms-drg-classifications-and-software</a>) for complete documentation of the GROUPER logic for MS-DRG
215. We encourage the requestor and any providers that have cases
involving heart assist devices for which they need ICD-10 coding
assistance and clarification on the usage of the codes, to submit their
questions to the American Hospital Association's Central Office on ICD-
10 at <a href="https://www.codingclinicadvisor.com/">https://www.codingclinicadvisor.com/</a>.
As previously noted, the requestor recommended that we consider
expansion of the open revision of heart structures to include the
atrial or ventricular septum and heart valves. The requestor did not
provide a specific list of procedure codes involving the open revision
of heart structures. While not explicitly stated, we understood this
request to be for our consideration of the reassignment of the
procedure codes describing the open revision of devices in the heart
valves, atrial septum, or ventricular septum to MS-DRG 215, therefore,
we reviewed the ICD-10-PCS classification and identified the following
18 procedure codes. These 18 codes are all assigned to MS-DRGs 228 and
229 (Other Cardiothoracic Procedures with and without MCC,
respectively) in MDC 05 in Version 41.1.
[[Page 35967]]
[GRAPHIC] [TIFF OMITTED] TP02MY24.017
Next, we examined claims data from the September 2023 update of the
FY 2023 MedPAR file for MS-DRG 228 and 229 to identify cases reporting
one of the 18 codes listed previously that describe the open revision
of devices in the heart valves, atrial septum, or ventricular septum.
Our findings are shown in the following table:
[GRAPHIC] [TIFF OMITTED] TP02MY24.018
As shown in the table, in MS-DRG 228, we identified a total of
4,391 cases with an average length of stay of 8.7 days and average
costs of $44,565. Of those 4,391 cases, there were 12 cases reporting a
procedure code describing the open revision of devices in the heart
valves, atrial septum, or ventricular septum, with average costs higher
than the average costs in the FY 2023 MedPAR file for MS-DRG 228
($51,549 compared to $44,565) and a longer average length of stay (15.7
days compared to 8.7 days). In MS-DRG 229, we identified a total of
5,712 cases with an average length of stay of 3.3 days and average
costs of $28,987. Of those 5,712 cases, there was one case reporting a
procedure code describing the open revision of devices in the heart
valves, atrial septum, or ventricular septum with costs lower than the
average costs in the FY 2023 MedPAR file for MS-DRG 229 ($11,322
compared to $28,987) and a shorter length of stay (1 day compared to
3.3 days).
We then examined claims data from the September 2023 update of the
FY 2023 MedPAR for MS-DRG 215. Our findings are shown in the following
table.
[GRAPHIC] [TIFF OMITTED] TP02MY24.019
Our analysis indicates that the cases assigned to MS-DRG 215 have
much higher average costs than the cases reporting a procedure code
describing the open revision of devices in the heart valves, atrial
septum, or ventricular septum currently assigned to MS-DRGs 228 and
229. Instead, the average costs and average length of stay for case
reporting a procedure code describing the open revision of devices in
the heart valves, atrial septum, or ventricular septum appear to be
generally more aligned with the average costs and average length of
stay for all cases in MS-DRGs 228 and 229, where they are currently
assigned.
In addition, based on our review of the clinical considerations, we
do not believe the procedure codes describing the open revision of
devices in the heart valves, atrial septum, or ventricular septum are
clinically coherent with the procedure codes currently assigned to MS-
DRG 215. Heart assist devices, such as ventricular assist devices and
artificial heart systems, provide circulatory support by taking over
most of the workload of the left ventricle. Blood enters the pump
through an
[[Page 35968]]
inflow conduit connected to the left ventricle and is ejected through
an outflow conduit into the body's arterial system. Heart assist
devices can provide temporary left, right, or biventricular support for
patients whose hearts have failed and can also be used as a bridge for
patients who are awaiting a heart transplant. Devices placed in the
heart valves, atrial septum, or ventricular septum do not serve the
same purpose as heart assist devices and we do not believe the
procedure codes describing the revision of these devices should be
assigned to MS-DRG 215. Further, the various indications for devices
placed in the heart valves, atrial septum or ventricular septum are not
aligned with the indications for heart assist devices. We believe that
patients with indications for heart assist devices tend to be
[…truncated; see source link]Indexed from Federal Register on May 2, 2024.
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