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Inpatient Rehab Facility Payments from Medicare Go Up 2.4% for 2021

Despite still being in a very challenging time, inpatient rehabilitation facilities (IRFs) have at least received some relief in the form of a payment increase from Medicare.

With operating expenses as high as they are, that 2.4% may not sound like a very big increase, but CMS expects total payments to increase by $260 million, making for a significant sum.

The 2.4% increase over the rate paid previously was proposed in April and went into effect October 1, 2020, at the start of the federal fiscal year, which runs from October 1 through September of the following year, and bears the number of the year in which it ends.

Rehab facility payments are a little different than many others in that they apply based on the date of discharge. In this case, the new rates apply specifically for IRF patients that were discharged on October 1st, 2020 or later, through September 30th of 2021.

Additional Changes in the CMS Rule

It wasn’t only the payments that were affected by the new rule.

  • Post-admission evaluation: During the COVID-19 public health emergency, the requirement for a physician to perform a post-admission evaluation on a new patient within the first 24-hours of being admitted into an IRF was suspended. With the new rule, CMS permanently eliminates the requirement for that evaluation. A pre-admission evaluation is still required, so the second evaluation was found to yield minimal benefit.
  • Non-physician practitioner allowed for one required visit: When a patient is in an IRF, a physician must visit them three times each week to make sure that their care plan is working the way it was intended to. The new rule allows for one of the three required weekly visits to be performed by a non-physician practitioner (NPP), beginning in the second week of the patient’s stay at the facility. These practitioners are frequently part of the patient’s treatment team throughout their program of care and have training and experience in providing care to this vulnerable population. Physicians maintain the flexibility to see each patient three or more times per week, as they choose.

Existing Requirements Added to Code

As part of the process of creating the new rule, CMS examined the IRF Prospective Payment System (PPS) website and Chapter One of the Medicare Benefit Policy Manual looking for policy requirements that were not previously included in regulation. The intention was to relieve burden on providers and clinicians. During this phase, requirements were not changed, it was just an effort to include all of the requirements in the code so that they could be easily found.

The existing regulation “requires that a comprehensive preadmission screening must meet ALL of the following requirements….  It includes a detailed and comprehensive review of each patient’s condition and medical history.” However, the regulation did not specify what exactly was required in order for the pre-admission screening documentation to qualify as “detailed and comprehensive.”

Chapter One of the Medicare Benefit Policy Manual does detail the elements of the pre-admission screening as well as specifying that “the rehabilitation physician should review and concur with the preadmission screening prior to the patient being admitted to the IRF.”

When the proposed rule was under review, there was some concern expressed by commenters that rather than decreasing burden, including the preadmission screening requirements in the regulation could increase denials of IRF claims because one or more of the elements of the preadmission screening documentation were missing. The committee writing the rule disagreed since there are no new requirements being added; the existing ones are just being codified so the requirements are all documented in the rule.

For those interested in the background and further details of the new rule, including all the factors used to determine the amount of the increase, the proposed rule can be found in the Federal Register online at Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2021.

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CategoryMedical Billing