The long-term acute-care hospital industry caught a major break when the CMS released final regulations for its 2005 inpatient prospective payment system, while hospitals slated to lose money under a wage-index change received two more years to adjust. The CMS dropped a proposal that would have allowed long-term acute-care hospitals housed within general hospitals -- a common model -- to draw no more than 25% of their admissions from the host hospitals. Operators said the restriction would close many facilities. Instead, over a four-year phase-in period, the CMS will limit additional Medicare payments to long-term acute-care hospitals for patients who did not qualify as outlier cases at the host hospitals.
The final inpatient PPS regulations, totaling more than 2,000 pages, are set to take effect Oct. 1. They were posted online Monday and will be published in the Federal Register Aug. 11. In another significant change from the proposed regulations released in May, the final regulations slow the effect of redefined Medicare wage-index areas. Medicare payments to hospitals moving into lower wage-index areas will be adjusted over two years, but hospitals moving to higher wage-index areas will receive the full benefit of their new regions immediately, the CMS said. Read the regulations. -- by Jeff Tieman