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Final IPPS Rule Elicits Objections from Hospital Groups

Cheryl Clark, for HealthLeaders Media, August 5, 2013

Two domains will be used to calculate hospitals' rates. The first is a composite measure called PSI-90, which includes 11 indicators of harm, such as pressure ulcers, hip fractures, sepsis, and deep vein thrombosis. The second is a combination of a hospital's rates of central line-associated blood stream infections (CLABSI) and catheter-associated urinary tract infections (CAUTI).

The IPPS final rule also refines the algorithm for the hospital value-based purchasing incentive program, also required by the Patient Protection and Affordable Care Act.

The Centers for Medicare & Medicaid Services' proposed and final rules are never entirely welcomed by hospitals and long-term care facilities that must conform to them. But the issue of how to define an inpatient stay versus an "observation" stay, which is reimbursed at lower outpatient rates and which costs beneficiaries more, has vexed the industry for several years.

Fearing recovery audit contractor penalties for what could be deemed inappropriate admissions, hospitals have dramatically increased the number of patients assigned to "observation" status, even though they may get the same care they otherwise would have received, and may stay as long.

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