FY22 Inpatient Prospective Payment System Final Rule Summary

On August 2, 2021, CMS released its final rule describing federal fiscal year (FY) 2022 policies and rates for Medicare’s inpatient prospective payment systems (IPPS) for acute care hospitals and the long-term care hospital (LTCH) prospective payment system. The final rule was published in the Federal Register on August 13, 2021. The payment rates and policies described in the IPPS/LTCH final rule (CMS-1752-F and CMS- 1762-F) affect Medicare’s operating and capital payments for short-term acute care hospital inpatient services and services provided in LTCHs paid under their respective prospective payment systems.

The final rule also sets forth rate-of-increase limits for inpatient services provided by certain “IPPS-Exempt” providers, such as cancer and children’s hospitals, and religious nonmedical health care institutions, which are paid based on reasonable costs. The proposed rule included several requests for information on quality measures, interoperability and health equities. CMS summarizes those comments and indicates that it will address the issues they raise in future rulemaking.