CEO Update 195
CMS Finalizes 2.5% IPF Payment Increase and Payment System Reforms
The Centers for Medicare & Medicaid Services’ (CMS) fiscal year (FY) 2025 final rule on the inpatient psychiatric facility prospective payment system (IPF PPS) implements a net increase of 2.5 percentage points. The overall update of $65 million, compared with FY 2024 payment levels, represents a slight decrease from the proposed 2.6 percentage point increase.
This update includes a market basket increase of 3.3 percentage points that is offset by a 0.5 percentage point for productivity. In addition, to maintain the mandated outlier pool of 2.0% of total payments, CMS finalized an outlier payment reduction of 0.3 percentage point to stay within this target, which reduces the number of cases that will qualify for an outlier payment.
CMS also finalized several adjustments to ensure that the PPS design and other changes discussed below are implemented in a budget-neutral manner. Due to these adjustments, the base per diem rate will be reduced to $876.53 from $895.63.
All-Inclusive Reporting
NABH is extremely disappointed that CMS finalized a significant narrowing of its all-inclusive reporting policy, which will take effect for upcoming cost reporting periods. Current policy allows IPFs to use an alternative methodology for reporting ancillary charges on cost reports. The final rule restricts this reporting option for ancillary charges only to Indian Health Service (IHS) hospitals, tribally owned and government-owned psychiatric, and acute care hospitals. CMS overlooked NABH’s strong caution that for many “all-inclusive IPFs,” significant administrative, timing and cost considerations will make impossible a timely transition to this change.
Under the finalized timing framework, CMS contractors will begin assessing compliance with the change through a look-back process that begins following the completion of a provider’s upcoming cost-reporting period that begins on or after Oct. 1, 2024. Specifically, all IPFs will be required to have a charge structure that allows the reporting of ancillary costs and charges on their cost reports for all ancillary services and correlating charges, such as labs and drugs.
With this change, IPFs that are currently in the all-inclusive category now will have their cost reports included in the annual IPF PPS update that CMS calculates. Because CMS calculates the annual update using the sum of routine and ancillary costs, in prior years the agency has removed from the calculation the all-inclusive IPFs, as their cost reports lack data on ancillary services. The final rule notes that in 2018, because of this exclusion, 82,491 (out of 364,080 total stays) were removed from the update calculation. CMS acknowledges that this exclusion has been producing skewed updates that do not represent the costs of the entire IPF field, with approximately 55 percent of stays from freestanding all-inclusive facilities removed in 2018, and 0.3 percent of stays from all-inclusive psychiatric units.
In response to feedback that all-inclusive IPFs are providing full and clinically-appropriate services and that the absence of ancillary charges on cost reports is due to gained cost efficiencies, CMS said it “believe[s that] IPFs are providing these necessary services to patients.” The agency added: “…maintaining an accurate charge structure would be part of a business’s accounting for reordering and restocking pharmaceuticals at a minimum, as well as more accurate payment for the purposes of outlier payments.”
Payment Increase for Electroconvulsive Therapy
For FY 2025, to achieve some alignment with outpatient rates, CMS finalized the proposed 71 percent increase for ECT payment per treatment from the current rate of $385.58 to $661.52.
IPF PPS Modifications
As mandated by Congress, CMS reviewed key IPF PPS elements with a focus on facility and patient-level adjustments, and in this rule finalizes multiple, relatively modest changes. While the agency is maintaining the rural and teaching facility adjustments, as is, the rule finalizes multiple budget-neutral changes to the structure of the PPS. As shown in Tables 4 and 5 in the rule, CMS finalized these changes:
- Added DRGs 917 (Poisoning and toxic effects of drugs w MCC) and 918 (Poisoning and toxic effects of drugs w/out MCC).
- Replaced DRGs 080 (Nontraumatic stupor & coma w MCC) and 081 (Nontraumatic stupor & coma w/o MCC) with DRGs 947 (Signs and Symptoms w MCC) and 948 (Signs and Symptoms w/out MCC.
- Removed 2 DRGs: DRG 887 (Other mental disorder diagnoses) and DRG 896 (Alcohol, Drug Abuse or Dependence w/out rehab therapy w MCC).
- Multiple changes to comorbidity payment add-ons were finalized as shown in Table 10.
IPF Quality Reporting Program
As proposed, the final rule implements one new measure: the 30-Day Risk-Standardized All-Cause Emergency Department Visit Following an Inpatient Psychiatric Facility Discharge. In response to concerns raised through public comments that its implementation may not be feasible, CMS did not finalize the proposed requirement for IPFs to submit patient-level quality data every quarter (versus the current annual basis).
Please see CMS’ fact sheet for more information about the rule.
NABH Seeks Member Feedback on CMS’ 2025 PFS and OPPS Proposed Rules
NABH seeks member feedback on the Centers for Medicare & Medicaid Services (CMS) proposed 2025 Physician Fee Schedule rule and 2024 Outpatient Prospective Payment System rule.
To weigh in, please begin by reviewing the regulations and NABH’s recent 2025 Physician Fee Schedule and 2025 Outpatient Prospective Payment System alerts to help NABH staff identify the priorities we should address with CMS, such as payment, impact on patients and quality, or operational challenges.
Please email your comments to Rochelle Archuleta by Friday, Aug. 9. Comments for both rules are due to CMS by Monday, Sept. 9.
Senate Passes Kids Online Safety and Privacy Act
The Senate on July 30 voted 91-3 to pass the Kids Online Safety and Privacy Act (KOPSA), a combination of the Kids Online Safety Act and the Children and Teens’ Online Privacy Protection Act. The bill would for the first time make social companies such as Facebook and TikTok responsible for the ill effects of design features that recommend content and encourage engagement.
KOPSA prescribes that technology companies must limit the amount of data they collect on children under 17; not target minors with advertising; give children the highest privacy settings by default; offer the ability to opt out of various design features like content recommendations and engagement nudges; and have an independent third party audit their platforms for potential harm to children; among other provisions.
Recent developments have increased pressure on Congress to pass a bill protecting online safety and privacy. Several states have passed social media and privacy laws aimed at mitigating youth harms. And in June, U.S. Surgeon General Vivek Murthy called for social media platforms to come with warning labels.
Technology companies and free speech advocates staunchly oppose the bill, which is expected to face certain legal challenges if it becomes law. Grassroots organizations alarmed by child suicide have pushed for the federal legislation, and have helped to enact laws in California, Colorado, Connecticut, Maryland, and New York meant to regulate social media for minors.
House companion bills are awaiting committee action, with House Energy and Commerce Chair Cathy McMorris Rodgers (R-Wash.) planning a vote this Fall. House Leadership has also signaled interest in the measures and there is bipartisan support for them.
Passing this legislation would be the first major regulation in years to alter how large technology companies interact with children on their platforms.
SAMHSA Releases 2023 National Survey on Drug Use and Health
The Substance Abuse and Mental Health Services Administration (SAMHSA) this week released key findings from the 2023 National Survey on Drug Use and Health (NSDUH).
Conducted by the federal government since 1971, the NSDUH is a primary source of statistical information on self-reported substance use and mental health of the U.S. civilian, noninstitutionalized population 12 or older. Estimates are presented by age group and by race/ethnicity for selected measures.
ASAM Past President Stuart Gitlow Pens Op-Ed on Cannabis Re-Scheduling
Stuart Gitlow, M.D., M.P.H., M.B.A., DFAPA, DFASAM, past president of the American Society of Addiction Medicine, penned an Op-Ed in ASAM Weekly in response to a proposal by the U.S. Justice Department to reschedule marijuana from Schedule I to Schedule III.
Currently, marijuana is illegal at the federal level, while many states have implemented decriminalization and legalization initiatives. This creates a difficult position for physicians (among others, such as dispensaries) who might recommend or fill out state-required forms for medical marijuana.
In his opinion piece, Gitlow argued that this would not change under rescheduling. Additionally, rescheduling would not decriminalize or legalize marijuana use. He also wrote there has not been sufficient research confirming any “true medical utility” of marijuana, whereas there is an understanding that the plant has addictive potential and impacts public health negatively.
Join NABH Sept. 10 for Webinar on the 2024 National Strategy for Suicide Prevention
Please help NABH recognize World Suicide Prevention Day on Tuesday, Sept. 10, 2024 by joining us for a webinar featuring two experts who will highlight HHS’ 2024 National Strategy for Suicide Prevention, a 10-year, comprehensive, societal approach to suicide prevention that provides concrete recommendations for addressing gaps in the suicide-prevention field.
The webinar will feature Julie Goldstein Grumet, Ph.D., vice president of suicide prevention strategy at the Education Development Center (EDC) and director of the EDC’s Zero Suicide Institute; and Colleen Carr, M.P.H., director of the National Action Alliance for Suicide Prevention.
Grumet and Carr will discuss the core strategic directions of the National Strategy; provide context on how these goals fit into current efforts by health systems, providers, and their partners in the field; highlight opportunities to support National Strategy implementation efforts; and what to expect – as well as how to engage – as the new strategy rolls out.
The discussion will also include an overview of key NABH priorities reflected in the new strategy, including workplace violence prevention and current efforts to protect and advance workforce wellbeing, including suicide prevention.
Please register here for this hourlong webinar on Tuesday, Sept. 10 webinar that starts at 2 p.m. ET. I hope you join us!
Reminder: Behavioral Health Business to Examine ‘How AI is Making Healthcare More Human’ in August Webinar
The publication Behavioral Health Business will host a webinar next month to explore how AI could potentially enhance humanity in behavioral health.
The discussion will examine how AI could extend to underserved communities, improve patient outcomes, and increase both clinician and patient satisfaction.
It also promises to highlight new research involving 130,000 patients that shows people are significantly more likely to begin therapy when their experience starts with Limbic, an AI-powered clinical assessment, with the most positive effects observed among minority groups.
The webinar will be held Thursday, Aug. 22 at Noon ET. Click here to register.
ICYMI: CMS Shares Discusses EMTALA and Behavioral Health in ACEP Podcast
CMS participated in the American College of Emergency Physicians’ ACEP Frontline podcast to discuss the Emergency Medical Treatment & Labor Act (EMTALA) and behavioral health.
The podcast describes how behavioral health conditions and physical health conditions are considered similarly from the standpoint of EMTALA.
Reminder: Please Submit Data to NABH’s Denial-of-Care Portal
We urge all NABH members to join those already submitting data to our Denial-of-Care Portal.
We are beginning to use aggregated portal data to illustrate and compare prior authorization practices for commercial, Medicare Advantage, and Medicaid managed care denials.
Policymakers have expressed particular interest in our aggregate estimate on days of uncompensated charity care, as well as the length of delayed health plan responses to prior-authorization requests.
To support this advocacy push, we strongly encourage all NABH members to submit data to the portal. Please contact NABH Associate Manager for Congressional Affair Emily Wilkins with questions about the data metrics that we are collecting and/or the data-submission process.
Fact of the Week
NBC News reported recently that athletes prioritized their mental health ahead of the Summer 2024 Olympic Games that opened in Paris a week ago.
For questions or comments about this CEO Update, please contact Jessica Zigmond.