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2024 IPPS Final Rule: Quality Programs

August 30, 2023

Over the last two weeks, we have provided the latest provisions arising from the 2024 Inpatient Prospective Payment System (IPPS) final rule released earlier this month by the Centers for Medicare and Medicaid Services (CMS). This alert will act as our final installment on the IPPS rule and will specifically focus on the CMS quality programs applicable to the inpatient hospital setting. Those provisions are summarized in a fact sheet also published by CMS, the highlights of which we have provided below.

Hospital Inpatient Quality Reporting Program

The Hospital IQR Program is a pay-for-reporting quality program that reduces payment to hospitals that fail to meet program requirements. Hospitals that fail to submit quality data or to meet all Hospital IQR Program requirements are subject to a one-fourth reduction in their Annual Payment Update under the IPPS.

The 2024 IPPS final rule (a) adopts three new measures, (b) removes three existing measures, and (c) modifies three current measures. The rule also finalizes two changes to current policies related to data submission, reporting and validation.

Specifically, CMS is adding three new electronic clinical quality measures (eCQMs) to the inventory of eCQMs from which hospitals can select to meet the eCQM reporting requirements for a given year for both the Hospital IQR and Medicare Promoting Interoperability Programs:

  • Hospital Harm — Pressure Injury eCQM, with inclusion in the eCQM measure set beginning with the CY 2025 reporting period/FY 2027 payment determination.
  • Hospital Harm — Acute Kidney Injury eCQM, with inclusion in the eCQM measure set beginning with the CY 2025 reporting period/FY 2027 payment determination.
  • Excessive Radiation Dose or Inadequate Image Quality for Diagnostic Computed Tomography (CT) in Adults (Hospital Level — Inpatient) eCQM, with inclusion in the eCQM measure set beginning with the CY 2025 reporting period/FY 2027 payment determination.

In addition, CMS is finalizing modifications to three current measures:

  • Hybrid Hospital-Wide All-Cause Risk Standardized Mortality measure beginning with the FY 2027 payment determination. CMS is finalizing a modification to include Medicare Advantage (MA) admissions.
  • Hybrid Hospital-Wide All-Cause Readmission measure beginning with the FY 2027 payment determination. CMS is finalizing a modification to include MA admissions.
  • COVID-19 Vaccination Coverage among Healthcare Personnel (HCP) measure beginning with the FY 2025 payment determination. The prior version of this measure reported on the primary vaccination series only, while the updated version of the measure reports the cumulative number of HCP who are up to date with recommended COVID-19 vaccinations to align CMS programs with the Centers for Disease Control and Prevention’s (CDC’s) definition of “up to date” vaccination, keeping the measure relevant if future vaccination guidance evolves. This measure modification is a cross-program change for the Hospital IQR Program, PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program, and the Long-Term Care Hospital Quality Reporting Program (LTCH QRP).

The final rule removes three measures:

  • Hospital-level Risk-Standardized Complication Rate Following Elective Primary Total Hip Arthroplasty and/or Total Knee Arthroplasty measure beginning with the April 1, 2025, through March 31, 2028, reporting period/FY 2030 payment determination. CMS is finalizing removal of this measure under the Hospital IQR Program in conjunction with the adoption of the recent updates to this measure in the Hospital Value-Based Purchasing Program.
  • Medicare Spending Per Beneficiary (MSPB) Hospital measure beginning with the CY 2026 reporting period/FY 2028 payment determination. CMS is finalizing removal of this measure under the Hospital IQR Program in conjunction with the adoption of the recent updates to this measure in the Hospital Value-Based Purchasing Program.
  • Elective Delivery Prior to 39 Completed Weeks Gestation: Percentage of Babies Electively Delivered Prior to 39 Completed Weeks Gestation measure beginning with the CY 2024 reporting period/FY 2026 payment determination. CMS is finalizing the removal of this measure because measure performance is so high and unvarying that meaningful distinctions and improvements in performance can no longer be made.

CMS is finalizing updates to the data submission and reporting requirements for the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey measure beginning with the CY 2025 reporting period/FY 2027 payment determination. These updates include three new web-first modes of survey implementation, removal of the survey’s prohibition on proxy respondents, extension of the data collection period from 42 to 49 days, limiting the number of supplemental survey items to 12, requiring the official Spanish translation for Spanish language-preferring patients, and removing two administration methods that are not used by participating hospitals. In a 2021 mode experiment, these changes, which are also being made in the Hospital VBP and PCHQR Programs, resulted in higher response rates and better representation of younger, Spanish language-preferring, racial and ethnic minority, and maternity care patients.  

Medicare Promoting Interoperability Program

CMS is finalizing the following changes to the Medicare Promoting Interoperability Program for eligible hospitals and CAHs:

  • Modify requirements for the Safety Assurance Factors for EHR Resilience (SAFER) Guides measure to require eligible hospitals and CAHs to attest “yes” to having conducted an annual self-assessment of all nine SAFER Guides at any point during the calendar year in which the EHR reporting period occurs, beginning with the 2024 reporting period.
  • Amend the definition of “EHR reporting period for a payment adjustment year” for participating eligible hospitals and CAHs to define the EHR reporting period in CY 2025 as a minimum of any continuous 180-day period within CY 2025.
  • Amend the definition of “EHR reporting period for a payment adjustment year” such that eligible hospitals that have not successfully demonstrated meaningful EHR use in a prior year will not be required to attest to meaningful use by October 1st of the year prior to the payment adjustment year, beginning with the 2025 reporting period.
  • Modify the response options related to unique patients or actions for objectives and measures for the Medicare Promoting Interoperability Program for which there is no numerator and denominator, and for which unique patients or actions are not counted. The response option for these would read “N/A (measure is Yes/No).”
  • Adopt three new eCQMs eligible hospitals, and CAHs can select as one of their three self-selected eCQMs, in alignment with the Hospital IQR Program, beginning with the CY 2025 reporting period:
    • Hospital Harm — Pressure Injury eCQM
    • Hospital Harm — Acute Kidney Injury eCQM
    • Excessive Radiation Dose or Inadequate Image Quality for Diagnostic Computed Tomography (CT) in Adults (Hospital Level — Inpatient) eCQM

Hospital Value-Based Purchasing (VBP) Program

The Hospital VBP Program is a budget-neutral program funded by reducing participating hospitals’ base operating DRG payments each fiscal year by two percent and redistributing the entire amount back to the hospitals as value-based incentive payments. In the FY 2024 IPPS final rule, CMS is finalizing the proposals to:

  • Adopt the Severe Sepsis and Septic Shock: Management Bundle measure in the Safety Domain beginning with the FY 2026 program year.
  • Adopt a health equity scoring change for rewarding excellent care in underserved populations such that a health equity adjustment would be added to hospitals’ Total Performance Scores (TPS) based on both a hospital’s performance on existing Hospital VBP Program measures and the proportion of individuals with dual eligibility status that a hospital treats. As a result, CMS is also finalizing the proposal to modify the TPS maximum to 110, such that the numeric score range would be 0 to 110.
  • Adopt substantive measure modifications to the MSPB Hospital measure, allowing readmissions to trigger new episodes, beginning with the FY 2028 program year.
  • Adopt substantive measure modifications to the Hospital-level Risk-Standardized Complication Rate Following Elective Primary Total Hip Arthroplasty and/or Total Knee Arthroplasty, adding additional mechanical complication ICD-10 codes to the measure, beginning with the FY 2030 program year.
  • Adopt changes to the data submission and reporting requirements of the HCAHPS survey measure beginning with the FY 2027 program year.
  • Codify the measure removal factors, the health equity scoring change and modification of the TPS numeric score range, and the minimum number of cases.

The full provisions of the final rule can be downloaded from the Federal Register at: https://www.federalregister.gov/public-inspection/2023-16252/medicare-program-hospital-inpatient-prospective-payment-systems-for-acute-care-hospitals-and-the.

To read an earlier alert regarding the 2024 IPPS Final Rule, click here.

With best wishes,

Chris Martin
Senior Vice President—BPO

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