FY 2025 Inpatient Psychiatric Facilities PPS Proposed Rule Summary

CMS published the fiscal year (FY) 2025 Inpatient Psychiatric Facilities (IPF) Prospective Payment System (PPS) proposed rule (CMS- 1806-P) in the Federal Register on April 3, 2024. The public comment period will end on May 28, 2024. IPFs include psychiatric hospitals and psychiatric units of acute care hospitals or critical access hospitals. The FY 2025 IPF PPS proposed rule includes proposals that will:

• Update IPF payment rates and adjustments and update the IPF Quality Reporting Programs;
• Revise patient-level adjustment factors as well as increase the per treatment amount for electroconvulsive therapy for the first time since the IPF was adopted based on an updated regression analysis using 2019-2021 Medicare claims data and cost report data consistent with requirements in the Consolidated Appropriations Act, 2023;
• Update core-based statistical areas that are the basis of the labor market areas used for determining the IPF wage index;
• Clarify the eligibility criteria to file an all-inclusive cost report;
• Solicit comments on updated regression analysis that may result in future revisions to facility level adjustments and elements to be included in the IPF patient assessment instrument that CMS is required to develop for FY 2028.

These changes are effective for IPF discharges occurring October 1, 2024, through September 30, 2025 (FY 2025).