2023 IPPS Proposed Rule Features MS-DRG, Acute Care Hospital, Long-Term Care Hospital Payments, & More

2023 IPPS Proposed Rule Features MS-DRG, Acute Care Hospital, Long-Term Care Hospital Payments, & More

The FY 2023 IPPS Proposed Rule draft was released on April 18th, and will be published in the May 10, 2022 Federal Register. Comments on the rule will be accepted until June 17, 2022, with the Final Rule expected in early August and implementation of all changes on October 1, 2022. The rule affects the Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) payment.

Increases to Long-Term Care Hospital Payments

long-term care hospital

The 1,786-page rule includes provisions for a 3.2-percent increase in payments for acute care hospitals that report quality data and are EHR meaningful users. This update will increase hospital payments by approximately $1.6 billion for FY 2023.

CMS Fact Sheet Gives More Information

CMS released an extensive Fact Sheet outlining provisions included in the Proposed Rule. Highlights include a proposal to modify the calculations of the FY 2023 MS-DRG and MS-LTC-DRG relative weights by calculating two sets of weights – one including and one excluding COVID-19 claims – and averaging the two sets to determine the values. This change is meant to address the assumption that there will still be some hospitalizations of Medicare beneficiaries due to COVID-19, but that this will be fewer than as reflected in the FY 2021 data.

Proposed Changes to MS-DRGs

There are no new MS-DRGs proposed for FY 2023, maintaining the same number of MS-DRGs at 767. There are proposed changes to the MS-DRGs for laser interstitial thermal therapy (LITT) procedures that are dependent on new procedure codes for LITT, changing these from Radiation Therapy to Medical and Surgical codes with the root operation of Destruction. Review of all diagnosis codes and procedure codes, including when a procedure should affect MS-DRG assignment, is continuing with some proposals for refinements to MS-DRG assignments for issues such as classification of rare diseases conditions with low volume claims data.

Proposed New Diagnosis and Procedure Codes and MS-DRG List

CMS final rule 2023 IPPS update

As always, proposed new ICD-10-CM diagnosis and ICD-10-PCS procedure codes are listed as part of the Proposed Rule in tables 6A and 6B respectively. There are more than 1,100 proposed ICD-10-CM codes, with a fewer number of ICD-10-PCS codes listed. Some ICD-10-PCS codes that were discussed at the March 9, 2022, meeting of the Coordination and Maintenance Committee may not have been ready for the Proposed Rule, but could be included in the Final Rule for implementation on October 1, 2022.

Also listed in the tables are invalid diagnosis and procedure codes and additions and deletions to the CC Exclusion, MCC and CC list. Table 5 includes the list of the MS-DRG titles including relative weights and other information.

Comments Solicited on Social Determinants of Health (SDOH)

CMS is soliciting comments on how reporting of SDOH diagnosis codes may improve the ability to recognize severity of illness, complexity of service and/or utilization of resources. Feedback on the best ways to promote the documentation and reporting of these SDOH codes is requested, with the objective of improving the reliability and validity of the coded data to support effort to advance health equity.

See the CMS Fact Sheet and the full text of the Proposed Rule for additional information and details on proposed changes for FY 2023.

For continuous updates on the 2023 IPPS Proposed Rule, stay tuned to the YES Blog.

Teri Jorwic

Contract Educator, MPH, RHIA, CCS, CCS-P, FAHIMA
long-term care hospital

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