Hospitals would get a 2.6% pay increase in fiscal 2025 under the Inpatient Prospective Payment System proposed rule released Wednesday by the Centers for Medicare and Medicaid Services.
The reimbursement boost, which the agency projects would be a $3.2 billion pay bump, is down from the 3.1% pay hike in fiscal 2024. The American Hospital Association, along with other hospital associations, said the proposed pay rates aren't enough to combat inflation.
Related: CMS proposes 2.8% hospital inpatient reimbursement hike
"CMS’ proposed inpatient hospital payment update of 2.6% is woefully inadequate," Ashley Thompson, AHA senior vice president of public policy analysis, said in a statement.
Premier, the group purchasing and consulting organization that works with thousands of hospitals, also said the rate increase was too low.
“With a mere 2.6% payment increase that fails to align with the stark realities of inflation and operational costs, persistent labor shortages and an aging demographic, the sustainability of our healthcare system is jeopardized,” Soumi Saha, senior vice president of government affairs for Premier, said in a statement.
The proposed rule includes higher new technology add-on payments designed to improve access to gene therapy for sickle cell disease, upping the add-on pay percentage to 75%. In addition, small independent hospitals, including many rural hospitals, would be reimbursed for establishing and maintaining a buffer stock of essential medicines.
Under the proposed rule, CMS would increase graduate medical education funding by $74 million for 200 new Medicare-funded residency positions from 2026 through 2036. CMS proposes to use the slots to bolster health professional shortage areas. At least half of the new graduate medical education slots would go toward psychiatry.
Also, CMS would maintain the low-wage hospital policy that caps wage index decreases at 5% through 2027.
The proposed rule would adopt seven new quality measures under the hospital inpatient quality reporting program, including post-operative respiratory failure and 30-day, risk-standardized death rate among surgical patients. It would remove five measures, including hospital-level, risk-standardized payments associated with a 30-day episode of care for acute myocardial infarction and pneumonia.
CMS proposed increasing long-term care hospitals' pay in fiscal 2025 by 1.6%, including a decrease in outlier payments.
The agency is also requesting information on the resources required to provide maternal health services.
