As the dominant payer for hospital & long-term nursing care in the US, the Centers for Medicare & Medicaid Services have considerable leverage over the healthcare industry – when leadership chooses to use it.
It’s refreshing to see CMS continuing to creatively use this leverage to push for higher standards of care in their newly finalized regulations that dictate certain requirements that need to be met in order for a provider to be able to participate in Medicare or Medicaid.
These changes, which take effect on October 1, 2024, are part of the FY 2025 Hospital Inpatient Prospective Payment System & Long-Term Care Hospital Prospective Payment System Final Rule.
The updated requirements focus on improving patient outcomes and ensuring that Medicare and Medicaid funds are used to support quality care. Here are some of the key features of the new rules:
Long-Term Care Hospital Quality Reporting
Long-term care facilities (nursing care facilities) provide critical care to patients with complex medical needs, often over extended periods- and CMS is also the dominant payer for these services – giving them tremendous leverage.
The updated Quality Reporting Program for skilled nursing facilities will now require more comprehensive reporting on various quality measures, including patient outcomes and healthcare-associated infections.
These changes are designed to incentivize them to focus on preventing infections and improving overall patient safety. By refining the reporting requirements, CMS is driving long term care facilities to prioritize quality care for some of the most vulnerable patients in the healthcare system.
Reducing Hospital Readmissions
Reducing unnecessary hospital readmissions has been a longstanding goal of CMS ever since the Affordable Care Act was implemented (which introduced the opportunity to drive positive change by punishing hospitals that have too many unnecessary hospital readmissions (usually due to poor discharge planning).
The new rules now include refined measures that better reflect the complexities of patient care and the various factors that contribute to readmissions. By penalizing hospitals with higher-than-expected readmission rates, CMS is encouraging providers to improve discharge planning, follow-up care, and patient education— core elements in reducing readmissions and enhancing overall patient outcomes.
Reducing Hospital-Acquired Conditions & Infections
Hospital-acquired conditions are avoidable infections and complications that can lead to significant patient harm. CMS’s updated HAC Reduction Program in the upcoming regulations aims to reduce the incidence of these conditions by penalizing hospitals who have high HAC rates.
The new regulations introduce updated measures and benchmarks that align more closely with the latest evidence on preventing these conditions.
Hospital Respiratory Infection Data Reporting
For the last 4 years CMS has been placing a strong emphasis on the importance of respiratory infection data. The new regulations require hospitals to report detailed data on respiratory infections that can be used tracking trends, identifying potential outbreaks early, and improving preparedness for future respiratory pandemics.
By mandating these reports, CMS is requiring hospitals who want to continue to get reimbursement from Medicare or Medicaid to improve their infection control practices and to be more vigilant in monitoring and responding to respiratory health threats.
Brief Mention of Other Changes
In addition to these major updates, CMS has also amended other programs, such as the Value-Based Purchasing Program and the Medicare Promoting Interoperability Program. These updates are part of a broader strategy to improve care quality across the healthcare system.
These new rules demonstrate that the agency under (its current leadership) is committed to using its considerable power to drive meaningful improvements in healthcare quality.
These new welcome regulations – which focus on reimbursement incentives – (both carrots and sticks) signal a positive shift towards a more accountable and patient-centered healthcare system, ultimately benefiting patients, taxpayer, and those who contribute to the Medicare Trust Fund through their payroll taxes.
