By Jeanie Davis

The Centers for Medicare & Medicaid Services (CMS) is focused on providing patients with better value and results via competition and innovation. Their final rule, issued in August, updated the Medicare payment policies for hospitals under the Inpatient Prospective Payment System (IPPS) and the Long-Term Care Hospital (LTCH) Prospective Payment System (PPS) for fiscal year (FY) 2020. Highlights include:

• Rural hospital wage index adjustments. Rural healthcare was one focus in last year’s proposed rules. Based on the feedback, CMS is improving the accuracy of the Medicare payments to the low-wage hospitals, allowing hospitals to increase staff wages. The idea is that this will help ensure that patients, especially those living in rural areas, continue to have access to high-quality, affordable healthcare.

“The wage index has been a problem for a long time,” says Elizabeth Lamkin, MHA, CEO and partner of PACE Healthcare Consulting. “The fact that there were two sets — rural and urban wages — created disparity. This is a good thing for rural hospitals to attract primary care staff and physicians.”

This final rule, which goes into effect Oct. 1, 2020, “is a major change whose result will have to be proven because wage is only one of many stressors with rural healthcare,” Lamkin adds. “I’m optimistic it will improve rural healthcare. It’s certainly a move in the right direction.”

The new technology policies will help ensure that Medicare beneficiaries continue to access potentially life-saving diagnostics and therapies, which will remove barriers in competition.

“Rural hospitals must be very careful when vetting new technology and identifying what will be most efficacious for their population,” Lamkin says. “Also, the technology requires training and upkeep, so it can become a burden even though it looks good at face value.”

CMS also is addressing the issue of hospitals using urban to rural hospital reclassifications to inappropriately influence the rural floor wage index value. CMS will remove these reclassifications from the calculation of the rural floor wage index value.

“This is a change for the better, as there are always people who want to game the system to get their hospital classified as rural when they aren’t,” explains Patricia Hildebrand, RN, MSN, executive director of Hildebrand Healthcare Consulting in Sugar Land, TX. “Some growing areas of Texas, for example, may be classified as rural when, in fact, they are up-and-coming with a great deal of housing and commercial development.”

• All-cause readmissions. As part of the Hospital Readmissions Reduction Program (HRRP), CMS proposes to remove the Claims-Based Hospital-Wide All-Cause Unplanned Readmission measure. This would begin in the July 1, 2023-June 30, 2024, reporting period. It will be replaced with a hybrid measure that includes claims and electronic medical record (EMR) data.

“This is a good thing, as true clinical factors such as vital signs and lab values will give a better picture of a patient’s acuity and severity of illness,” says Hildebrand. “It goes back to documentation and using the 13 clinical factors meshed with claims data. These clinical factors should be collected automatically from the EMR so it is not based on narrative info. They should be taking vital signs every day to ascertain the level of acuity.”

Hildebrand’s only concern, she says, “is for hospitals that haven’t progressed in adopting EMR or still upload PDFs instead of entering data, as it won’t work. Otherwise, it’s a really good thing — a much better picture of where the patient is clinically.”

• Interoperability. The CMS interoperability initiative encourages professionals, hospitals, and critical access hospitals to adopt, implement, upgrade, and demonstrate meaningful use of EMR technology.

The MyHealthEData initiative launched in 2018 to empower patients with control of their healthcare data. CMS continues to promote interoperability, implementing changes to reduce the burden of compliance. This includes finalizing a new opioid-related quality measure.

“Interoperability is a good thing,” says Lamkin. “Interoperability is one of the most important ideas out there. With interoperability and use of EMR systems, we will be more efficient in communication.”

The EMR system requires gathering and reporting patient data using standard methods, with specific inclusions and exclusions based on the needs of specific patient populations. “This will create a much purer information stream, one that’s more relevant to the patient’s status,” Lamkin says. “With EMR systems in place, we will be comparing apples to apples, which will ensure the reporting is accurate.”

Hildebrand adds, “Sharing this information with the patient and the doctor is creating very informed consumers, as they should be. They want to receive the information electronically, and we should be able to do that. We need systems that talk to each other, that are part of the same high-tech world as our patients.”

• Interoperability and the prescription drug monitoring program. Interoperability is the focus of proposals regarding the prescription drug monitoring program (PDMP). For the 2020 EMR reporting period, the Query of PDMP measure is optional and available for bonus points.

Last year, this program faced unintended and unforeseen challenges in implementation and provider burden. To minimize burden, CMS added this function to the nursing station. Discharge of a patient with opioids is now a “yes/no” at the station, says Hildebrand. “This is an example of things that get rolled out, then become very difficult to manage operationally,” she says.

This change is an example of how effective feedback can be, adds Lamkin. “CMS asks for this feedback in July every year, when they release proposed changes. Mark that on your calendar. Start watching for proposals so you can provide feedback,” Hildebrand says. (More information on the rule is available online at: and: