CMS Issues IPPS Final Rule for FY 2014

Date posted: September 11, 2013

The Centers for Medicare & Medicaid Services (CMS) recently issued a Hospital Inpatient Prospective Payment System (IPPS) final rule updating fiscal year (FY) 2014 Medicare payment policies and rates for inpatient stays.  Key highlights of the final rule include:

  • Incentive payments made to hospitals beginning in FY 2015 that are in the lowest quartile for medical errors or serious infections under the new Hospital-Acquired Condition (HAC) Reduction Program.
  • An increase in the reduction of payments for hospitals with excess 30-day readmissions for heart attack, heart failure, and pneumonia patients from 1 to 2 percent.
  • An increase in the number and types of planned readmissions that do not count against a hospital’s readmission rate.
  • Clarification that  inpatient hospital admissions are appropriate for Medicare Part A payment if a physician expects a surgical procedure, diagnostic test, or other treatment to require a hospital stay lasting at least two midnights, and the physician admits the patient on that expectation.
  • Clarification that the timeframe for which to bill Medicare Part B for inpatient services inappropriately billed under Part A applies to dates of service on or after October 1, 2013.

The IPPS final rule for FY 2014 is available by clicking here.


Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long Term Care; Hospital Prospective Payment System and Fiscal Year 2014 Rates; Quality Reporting

Requirements for Specific Providers; Hospital Conditions of Participation; Payment Policies Related to Patient Status; Final Rule, 78 Fed. Reg. 160, 50495, 50496 (Aug. 19, 2013).

Centers for Medicare & Medicaid Services.  “CMS Finalizes FY 2014 Policy and Payment Changes for Inpatient Hospital Stays in Acute-Care and Long-Term Care Hospitals.”  Fact Sheet.  2 Aug. 2013.

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