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Statement on the FY 2024 Hospital Inpatient Prospective Payment System Proposed Rule

By Soumi Saha, Senior Vice President of Government Affairs, Premier

The Centers for Medicare & Medicaid Services (CMS) continues to use data sources for calculating labor costs that fail to capture the stratospheric rise in the cost of labor that have plagued hospitals since the pandemic started. This chasm between the 2.8 percent payment update and reality, coupled with uncomfortably high inflation, delivers a one-two punch to hospitals that must be addressed. Premier will continue to press CMS to adopt new or supplemental data sources to calculate labor costs in the final rule that more accurately reflect the cost of labor, such as more real-time data directly from hospitals, inclusive of contract labor.

Premier appreciates CMS progressing from collecting information on health equity via its numerous requests for information to acting on stakeholder recommendations, including providing incentives for hospitals to advance health equity and improve access to care for underserved populations. Premier looks forward to unpacking the details of the proposals and working with CMS to refine these policies to ensure they accomplish their intended purpose.

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