Medicare Prescription Drug
Law and Omnibus Legislation Include Language on Medicare Rehabilitation
Proposed Rule
December 19, 2003 - Conference report language in
both the recently signed Medicare prescription drug legislation
(H.R.
1) and the FY 2004 Consolidated Appropriations Act (H.R.
2673) urges the Centers for Medicare and Medicaid Services
(CMS) to delay implementation of its Medicare Rehabilitation
Proposed Rule, known as the "75 percent rule," that
would tighten the eligibility criteria for inpatient rehabilitation
facilities. In addition, both sets of language suggest further
study of the issue before implementation of the rule. While
the report language does not require CMS to delay the study,
CMS has reportedly indicated that the rule will not be implemented
as expected on Jan. 1, 2004.
The conference report language accompanying Section 501 in
H.R. 1 states, "The Conferees are concerned that the
rule, as written, would have severe consequences for access
to inpatient rehabilitation hospital services. The Conferees
concur with the Medicare Payment Advisory Commission (MedPAC)
finding that further analysis should be conducted to identify
which conditions are clinically appropriate for inclusion
in the calculation of the 75 percent rule used to determine
eligibility for reimbursement under the inpatient rehabilitation
facility prospective payment system. The Conferees direct
the GAO to issue a report, in consultation with experts in
the field of physical medicine and rehabilitation to look
at whether the current list of conditions represents a clinically
appropriate standard for defining IRF [inpatient rehabilitation
facility] services and, if not, which additional conditions
should be added to the list. During the study period, the
Committee urges the Secretary to delay implementation of the
rule and not accept new IRF applications until the report
is finished."
The omnibus appropriations conference report states, "The
conferees are concerned that the proposed Medicare '75% Rule'
classifying inpatient rehabilitation facilities (IRFs) would
have severe consequences for access to inpatient services.
The conferees concur with the Medicare Payment Advisory Commission
(MedPAC) finding that further analysis should be conducted
to identify which criteria are clinically appropriate for
inclusion in the calculation of the rule used to determine
eligibility for reimbursement under the IRF prospective payment
system. The conferees direct CMS to contract with the Institute
of Medicine to issue a report, in consultation with a panel
of independent experts in the field of physical medicine and
rehabilitation, to establish clinically appropriate standards
for medical necessity and clinically appropriate qualification
criteria for IRFs. During the study period, the conferees
expect the Secretary to delay implementation of the 75% rule,
delay implementation of local medical review policies concerning
medical necessity, and not accept new IRF applications until
the report is finished." The omnibus appropriations bill
was approved by the House on Dec. 8 and is scheduled to be
addressed by the Senate when they return to Washington on
Jan. 20.
CMS Sept. 9 issued a proposed rule that would revise the
criteria (commonly known as the "75 percent rule")
used to classify a hospital as an IRF for Medicare purposes.
Hospitals that have the IRF classification receive Medicare
payments according to the rehabilitation prospective payment
system (PPS), rather than the acute inpatient PPS [see Washington
Highlights, Sept. 12].
Information:
Lynne Davis Boyle, Assistant Vice President
AAMC Government Relations
ldavisboyle@aamc.org
(202) 828-0526
Karen Fisher, Sr. Director, Health Care Affairs
AAMC Health Care Affairs
kfisher@aamc.org
(202) 862-6140
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