On July 27, 2023, CMS issued a final rule on the Medicare inpatient rehabilitation facility prospective payment system (IRF PPS) for federal fiscal year (FY) 2024. In addition to provisions that would update the IRF PPS payment rates and outlier threshold for FY 2024, the rule finalizes two new measures and is modifying another measure for the IRF Quality Reporting Program. This rule also finalizes its proposal to rebase and revise the IRF market basket to reflect more recent data on IRF cost structures. In addition, CMS finalizes a modification to the excluded unit regulation that would allow a hospital to open a new IRF unit and begin being paid under the IRF PPS at any time during the cost reporting period, provided the hospital meets certain requirements. CMS estimates that the Medicare IRF PPS payments in FY 2024 will be about $355 million higher than in FY 2023.