Market Basket Reductions on the Way
From editorial board member Kathleen M Griffin, PhD
, National Director, Post Acute and Senior Services
, Health Dimensions Group
, Scottsdale, Ariz.
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (PPACA). PPACA Sections 3401 and 3137 contain a number of provisions affecting institutional providers. The 3401 sections discussed below are effective April 1, 2010, while Section 3137(a) has October 1, 2009, and April 1, 2010 effective dates. The Centers for Medicare & Medicaid Services is working to expeditiously implement these important provisions of PPACA. Providers will begin seeing payments under these provision in the late April/early May time frame. Be on the alert for more information about these provisions and their impact on past and future claims. What follows are brief descriptions of each provision:
Inpatient Acute Hospitals (Section 3401(a))
Section 3401(a) of PPACA imposes a 0.25 percentage point reduction to the Inpatient Prospective Payment System (IPPS) hospital's market basket for fiscal year (FY) 2010, effective for discharges on or after April 1, 2010. The reduction to the market basket will affect IPPS rates for discharges occurring on or after April 1, 2010, through September 30, 2010.
Long-Term Care Hospitals (Section 3401(c))
Section 3401(c) of PPACA imposes a 0.25 percentage point reduction to the Long Term Care Hospital's (LTCH) market basket for FY 2010, effective for discharges on or after April 1, 2010. The reduction to the market basket will affect LTCH rates for discharges occurring on or after April 1, 2010, through September 30, 2010.
Inpatient Rehabilitation Facilities (Section 3401(d))
Section 3401(d) of PPACA imposes a 0.25 percentage point reduction to the Inpatient Rehabilitation Facility market basket for FY 2010, effective for discharges on or after April 1, 2010. The reduction is also resulting in changes to the standard payment conversion factor, payment rates, and the outlier threshold amount.
Extension of Section 508 Hospital Reclassifications (Sections 3137(a) and 10317)
Sections 3137(a) and 10317 extend section 508 and special exception hospital reclassifications from October 1, 2009, through September 30, 2010. Effective April 1, 2010, section 3137(a) and 10317 also require removing section 508 and special exception wage data from the calculation of the reclassified wage index if doing so raises the reclassified wage index. All hospitals affected by sections 3137(a) and 10317 will be assigned an individual special wage index effective April 1, 2010. If the section 508 or special exception hospital's wage index applicable for the period beginning on October 1, 2009, and ending on March 31, 2010, is lower than for the period beginning on April 1, 2010, and ending on September 30, 2010, the hospital will be paid an additional amount that reflects the difference between the wage indices. The provision applies to both inpatient and outpatient hospital payments.