Premier Comments on FY 2024 Medicare Inpatient Payment Proposed Rule

Premier submitted comments to the Centers for Medicare & Medicaid Services (CMS) today on the FY 2024 Inpatient Prospective Payment System (IPPS) proposed rule. In detailed comments, Premier urged CMS to:

• Adopt new or supplemental data sources, such as PINC AI™ data, to ensure labor costs are adequately reflected in the Medicare hospital payment update in the final rule. Premier also strongly urges CMS to apply a one-time adjustment to course correct for its significantly lower estimates of costs for FYs 2021-2023. At a minimum, CMS must address the gross underpayment that occurred in FY 2022 via a one-time adjustment of at least 3 percent.

• Provide greater transparency around the assumptions it uses for calculating uncompensated care payments and better account for the unwinding of certain COVID-19 policies, such as the Medicaid continuous enrollment provision, when estimating the rate of uninsured for FY 2024.

• Solicit input from the hospital community on 1) reforms to the wage index and 2) efforts to improve the sustainability of workforce, especially in rural and underserved communities.

• Finalize its reclassification of the Z-codes representing homelessness and consider ways to address persistent issues that may limit how accurately these and other Z-codes are capturing the significant resource use involved in providing care to underserved populations.

• Continue to evaluate and revisit the COVID-19 Vaccination Coverage Among Healthcare Personnel (HCP) measure and its utility for patients and facilities as part of next year’s rulemaking. Premier is generally supportive of revising the measure to align with the Centers for Disease Control and Prevention (CDC) recommendations; however, we are concerned this change will impose significant burden on facilities and believe the measure should be re-evaluated in light of where the nation is in its COVID-19 response. At a minimum, Premier urges CMS to revise the measure to only require annual reporting, which would align with reporting requirements for the influenza measure.

• Not finalize adoption of the Severe Sepsis and Septic Shock: Management Bundle (SEP-1) measure into the Hospital Value-Based Purchasing (VBP) Program. As discussed in greater detail below, this measure poses significant burden on providers and is generally not aligned with national guidelines for care. Premier instead strongly urges CMS to work with relevant stakeholders to develop an outcome-based digital quality measurement that is a true metric of sepsis care.

• Work with stakeholders to fine-tune its methodology for calculating a health equity adjustment in the Hospital VBP Program prior to adoption. While Premier is conceptually supportive of a health equity adjustment, there are several challenges associated with the proxies that CMS is considering for measuring a hospital’s underserved population that must be addressed, especially in light of the redistributive impacts the addition of the bonus may have on Hospital VBP Program incentive payments.

• Work with the hospital community to understand the burden associated with implementing certain electronic clinical quality measures (eCQMs) and the system changes that will be required prior to requiring them to be reported in either the pay-for-reporting or pay-for-performance quality reporting programs.