The Centers for Medicare and Medicaid Services (CMS) has released the fiscal year (FY) 2025 inpatient rehabilitation facility prospective payment system (IRF PPS) proposed rule. The proposed rule will be published in the March 29, 2024, Federal Register. A high-level overview of the proposed rule is provided below:

Payment Updates:

CMS estimates an overall increase in aggregate payments to IRFs by 2.5% or $255 million (compared to the 4% payment update in FY 2024).

Market basket update for IRF services is 3.2%. This will be reduced by a productivity adjustment of 0.4%, which would result in an overall 2.8% increase. These figures are likely to change due to updated forecasts.

CMS is proposing to update the outlier threshold amount from $10,423 (FY 2024) to $12,158 (FY 2025), which would account for an estimated 0.2 percent decrease to aggregate payments across the IRF PPS in FY 2025.

Quality Reporting Program (QRP) Updates:

CMS is proposing to make additions, modifications, and removals of some QRP measures. A proposal was included to collect four new Standardized Patient Assessment Data Elements (SPADE) in the IRF QRP to bolster the collection of information on social determinants of health (SDOH):

• Living Situation: Requests regarding the current living situation;
• 2 Food Items: Questions about food running out;
• Utilities: Questions about threats to shutting off utilities; and
• A modification to an existing SPADE on Transportation.

CMS is also proposing to remove the “Admission Class” from the IRF Patient Assessment Instrument (PAI).

Feedback is requested on future revisions to the IRF QRP, as well as feedback on the development of a five-star methodology for IRFs.

Additional information will be forthcoming. Comments on the proposed rule are due to CMS by the end of May.