CMS Releases Inpatient Rehabilitation Facility PPS Proposed Rule for FY 2023

By Nirmala Sivakumar, CCS, CDIP

The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule to update the Medicare fee-for-service (FFS) prospective payment system (PPS) for inpatient rehabilitation facilities (IRFs) for fiscal year (FY) 2023, which begins Oct. 1, 2022. Similar to the FY 2022 rule, CMS is proposing minimal changes.

1. The proposed rule would increase payments by 2.8% and will cap wage index decreases at 5% to mitigate instability in IRF PPS payments.
2. Case mix group relative weights will be updated using FY 2021 claims and the most recent cost report data.
3. The Office of Inspector General (OIG) had evaluated early discharges from IRFs to home health and recommended that CMS expand the IRF transfer payment policy to apply to early discharges to home health. Based on this recommendation, CMS is requesting feedback from stakeholders about potentially including home health in the IRF transfer payment policy,
4. CMS proposes to require IRFs to collect quality data on all patients, regardless of payer, beginning in October 2023. This would help to ensure that all patients regardless of payer are receiving the same quality of care.
5. CMS is proposing to codify the longstanding IRF teaching status adjustment policy in regulation and clarify certain teaching status adjustment policies.
6. Potential inclusion of an updated healthcare-associated infection measure in the IRFQRP. CMS solicits feedback on the potential future use of an electronic health record-informed quality measure as well as frameworks to address disparities in outcomes.

CMS will accept comments on the rule until 5 p.m. on May 31


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About the author

Nirmala Sivakumar, CCS, CDIP
Nirmala Sivakumar is an IRF Coding Educator based in PA. She has created and presented many webinars and workshops on IRF coding and improving clinical documentation. She has trained and mentored many rehab coders. She also has experience in conducting coding audits. She enjoys sharing her expertise and knowledge and has a desire to help coders and PPS Coordinators overcome the challenges of IRF PPS coding.

She has held previous positions as Health Information Management Supervisor for one of HealthSouth’s (Encompass) acute inpatient rehab hospital and as a HIM Coding Consultant at Uniform Data Systems for Medical Rehabilitation. She can be reached at [email protected] or visit

Disclaimer: This article is written for educational purposes only. Every reasonable effort has been made to ensure its accuracy and completeness. It is the responsibility of the reader to refer to the definitions, descriptions, conventions, and guidelines specific to each coding classification, as well as relevant laws and regulations when selecting and reporting medical codes.

About the Author

Libman Education
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