Inpatient Facility Coding & Compliance Alert

Hospitals began 2012 on a good note reimbursement-wise, thanks to the FFY 2012 operating rate increasing by 0.9 percent when compared to FFY 2011. The federal inpatient operating rate currently is $5,209.74 for FFY 2012, compared to $5,164.11 for FFY 2011.

According to the recently released IPPS proposed rule for FFY 2013, CMS proposes a federal operating rate of $5,325.62. The proposed rate represents a 2.2 percent increase over the 2012 operating rate.

Prepare to take a hit: Decreases will be coming, however. CMS intends to reduce the rate by 3.9 percent over a period of years to eliminate the effect of coding improvements and to implement certain statutory provisions contained in the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively known as the Affordable Care Act) and other legislation.
The 2013 proposed rule doesn't outline how CMS will implement the 2.0 percent sequestration reduction to all lines of Medicare payment scheduled to take effect on January 1, 2013. Congress authorized sequestration reductions as part of the Budget Control Act (BCA) of 2011. Some experts believe the 2.0 percent reduction will be applied at remittance (the time Medicare contractors pay each Medicare FFS claim) and will be incorporated into the cost report settlement.
Stay tuned: Any proposed program changes that are adopted will be effective for discharges on or after October 1, 2012, unless otherwise noted.