Most acute-care hospitals will receive a 2.3% increase in their Medicare inpatient payment rates in fiscal 2001--one of several changes in hospital payments included in final PPS regulations HCFA issued last week.
The payment increase, which is higher than the 2% hike HCFA proposed in May, is the most generous annual update hospitals have seen since Congress passed the Balanced Budget Act of 1997 (See chart).
The changes in the final PPS regulations, which were published in the Aug. 1 Federal Register, take effect Oct. 1, when fiscal 2001 begins.
However, hospitals, which are lobbying for an additional $25 billion in relief from the balanced-budget law, said they were not satisfied with the update.
"While the standardized payment amounts are going up by 2.3%, as a result of other payment changes, the average payment per case is only increasing 1.5%," said Karen Fisher, associate vice president of the Association of American Medical Colleges, which represents many of the nation's teaching hospitals.
Other changes to the inpatient PPS include revised area wage indexes, changes to the DRG classifications used to determine payments and modified graduate education payments.
HCFA also published a set of interim final regulations in the Aug. 1 Federal Register implementing the Balanced Budget Refinement Act of 1999, which rolled back some of the Medicare payment reductions in the 1997 budget law.
Those interim regulations reclassify certain counties so hospitals in those areas can draw higher Medicare payments. They also modify the requirements for critical-access hospitals.
Most of the changes in the interim regulations have either been in effect since the enactment of the 1999 law or are retroactively effective to the beginning of fiscal 2000, which began Oct. 1, 1999.
HCFA is accepting public comments on both sets of regulations through Aug. 31, when the 30-day comment periods end. HCFA takes those comments into consideration when working on the next proposed inpatient rule.