CMS has proposed that the long-term care hospitals (LTCHs) PPS Federal rate remain at $38,086.04 for the 2007 rate year, based on cost reports that indicate that LTCH Medicare margins were 8.8% for FY 2003 and 11.7% for FY 2004. CMS is also proposing to adopt the Rehabilitation, Psychiatric, and Long-Term Care market basket to replace existing measures of inflation for calculating the annual update, which will result in an increase in the labor share, from 72.9% to 75.9%. Based on CMS projections, Medicare payments under the LTCH PPS will be $5.21 billion for 2007, an increase of approximately 70% since FY 2003. Click here to download the proposed rule.
