Medicare Program; FY 2026 Inpatient Psychiatric Facilities Prospective Payment System-Rate Update t available data on the resources involved in inpatient psychiatric care and the costs of these resources. We continue to expect that paying prospectively for IPF services under the FY 2026 IPF PPS will enhance the efficiency of the Medicare program. 5. Effects of the Updates to the IPFQR Program In section V.B. of this final rule, we finalize changes to begin use of the IPF ED Visit measure in the IPFQR Program with the FY 2029 payment determination instead of the FY 2027 payment determination, and to modify the reporting period for the IPF ED Visit measure to a 2-year reporting period that runs from July 1st 4 years prior to the applicable fiscal year payment determination to June 30th 2 years prior to the applicable fiscal year payment determination. While the modification may allow providers additional time to incorporate changes to IPF workflows and clinical processes to improve care coordination and discharge planning, we do not expect any additional effects beyond those discussed in the FY 2025 IPF PPS final rule (89 FR 64672). In section V.C. of this final rule, we finalize the removal of the Facility Commitment to Health Equity measure beginning with the FY 2026 payment de d in the FY 2025 IPF PPS final rule (89 FR 64672). In section V.C. of this final rule, we finalize the removal of the Facility Commitment to Health Equity measure beginning with the FY 2026 payment determination. Because this measure requires IPFs to attest yes or no if they have in place certain structures or processes of care, we do not expect the removal of this measure to impact providers beyond reduction in information collection costs. In section V.D. of this final rule, we finalize the removal of the COVID–19 Vaccination Coverage Among HCP measure beginning with the FY 2026 payment determination. Because this measure requires IPFs to track current vaccination status for all employees, licensed independent practitioners, adult students/trainers and volunteers, and other contract personnel and report the data monthly to NHSN, we expect the removal of this measure to reduce information collection burden on providers. In section V.E. of this final rule, we finalize the removal of the Screening for Social Drivers of Health and Screen Positive Rate for Social Drivers of Health measures from the IPFQR Program beginning with the FY 2026 payment determination. Because these measures e Screening for Social Drivers of Health and Screen Positive Rate for Social Drivers of Health measures from the IPFQR Program beginning with the FY 2026 payment determination. Because these measures require IPFs to screen patients for five health-related social needs domains and submit aggregated IPF- level measure data, we expect the removal of these measures to reduce information collection burden on providers and patients. In section V.G. of this final rule, we finalize updates to our ECE policy. Because the process for requesting or granting an ECE will remain the same as the current ECE process, we do not expect these updates to impact providers. In accordance with section 1886(s)(4)(A) of the Act, we will apply a 2-percentage point reduction to the FY 2026 market basket update for IPFs that have failed to comply with the IPFQR Program requirements for the FY 2026 payment determination, including reporting on the mandatory measures. For the FY 2025 payment determination, of the 1,514 IPFs eligible for the IPFQR Program, 126 IPFs did not receive the full IPF market basket update because of the IPFQR Program; 40 of these IPFs chose not to participate and 86 did not meet the req ,514 IPFs eligible for the IPFQR Program, 126 IPFs did not receive the full IPF market basket update because of the IPFQR Program; 40 of these IPFs chose not to participate and 86 did not meet the requirements of the program. We intend to closely monitor the effects of the IPFQR Program on IPFs and help facilitate successful reporting outcomes through ongoing education, national trainings, and a technical help desk. 6. Regulatory Review Costs If regulations impose administrative costs on private entities, such as the time needed to read and interpret the proposed rule, we should estimate the cost associated with the regulatory review. Due to the uncertainty involved with accurately quantifying the number of entities that will review the rule, we assume that the total number of unique commenters on the most recent IPF PPS proposed rule will be the number of reviewers of this final rule. For this FY 2026 IPF PPS final rule, the most recent IPF proposed rule was the FY 2026 IPF PPS proposed rule, and we received 55 unique comments on the proposed rule. We acknowledge that this assumption may understate or overstate the costs of reviewing this rule. It is possible that not all commente ed rule, and we received 55 unique comments on the proposed rule. We acknowledge that this assumption may understate or overstate the costs of reviewing this rule. It is possible that not all commenters reviewed the FY 2026 IPF proposed rule in detail, and it is also possible that some reviewers chose not to comment on the proposed rule. For these reasons we thought that the number of commenters would be a fair estimate of the number of reviewers of this rule. We welcomed any public comments on the approach in estimating the number of entities that would review the proposed rule. We did not receive any public comments specific to our solicitation. We also recognize that different types of entities are in many cases affected by mutually exclusive sections of this final rule, and therefore for the purposes of our estimate, we assume that each reviewer reads approximately 50 percent of the rule. We sought public comments on this assumption. We did not receive any public comments specific to our solicitation. Using the May, 2024 mean (average) wage information from the Bureau of Labor Statistics (BLS) for medical and health service managers (Code 11– 9111), we estimate that the cost of to our solicitation. Using the May, 2024 mean (average) wage information from the Bureau of Labor Statistics (BLS) for medical and health service managers (Code 11– 9111), we estimate that the cost of reviewing this rule is $132.44 per hour, including overhead and fringe benefits (https://www.bls.gov/oes/current/oes_ nat.htm). Assuming an average reading speed of 250 words per minute, we estimate that it would take approximately 1.67 hours for the staff to review half of this final rule which contains a total of approximately 50,000 words. For each entity that reviews the rule, the estimated cost is $221.17 (1.67 hours × $132.44). Therefore, we estimate that the total cost of reviewing this regulation is $12,164.35 ($221.17 × 55). D. Alternatives Considered The statute gives the Secretary discretion in establishing an update methodology to the IPF PPS. We continued to believe it is appropriate to routinely update the IPF PPS so that it reflects the best available data about differences in patient resource use and costs among IPFs, as required by the statute. Therefore, we proposed and are finalizing updates to the IPF PPS using the methodology published in the RY 2005 IPF PPS final in patient resource use and costs among IPFs, as required by the statute. Therefore, we proposed and are finalizing updates to the IPF PPS using the methodology published in the RY 2005 IPF PPS final rule (our ‘‘standard methodology’’), pre-floor, pre- reclassified IPPS hospital wage index as its basis. Additionally, we apply a 5- percent cap on any decrease to a provider’s wage index from its wage index in the prior year. In addition, we are finalizing our proposal to revise the facility-level adjustment factors for teaching status and for IPFs located in VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o l 37674 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations rural areas. We also considered, but did not propose, maintaining the existing adjustment factors for teaching status and for IPFs located in rural areas. However, for the reasons discussed earlier in this final rule, we believe it would be more appropriate to update these adjustment factors based on the results of our latest available analysis. Lastly, as discussed the reasons discussed earlier in this final rule, we believe it would be more appropriate to update these adjustment factors based on the results of our latest available analysis. Lastly, as discussed in section IV.D.7. of this final rule, we are finalizing our proposal to maintain the existing COLA factors for IPFs located in Alaska and Hawaii. We considered, but did not propose, updating the COLA factors for IPFs based on the results of our existing methodology. However, as discussed earlier in this final rule, in order to maintain consistency in payments for IPFs and other hospitals located in Alaska and Hawaii, for FY 2026 we are maintaining the existing COLA factors that are applicable for FY 2025. E. Accounting Statement Consistent with OMB Circular A–4 (available at https://trumpwhitehouse. archives.gov/sites/whitehouse.gov/files/ omb/circulars/A4/a-4.pdf), in Table 13, we have prepared an accounting statement showing the classification of the expenditures associated with the updates to the IPF wage index and payment rates in this final rule. Table 13 provides our best estimate of the increase in Medicare payments under the IPF PPS as a result of the changes presented in thi dates to the IPF wage index and payment rates in this final rule. Table 13 provides our best estimate of the increase in Medicare payments under the IPF PPS as a result of the changes presented in this final rule and is based on 1,387 IPFs that had data available in the PSF and claims in our FY 2024 MedPAR claims dataset. Lastly, Table 13 also includes our best estimate of the costs of reviewing and understanding this final rule. TABLE 13—ACCOUNTING STATEMENT: CLASSIFICATION OF ESTMATED COSTS, SAVINGS, AND TRANSFERS Category Primary estimate ($million/year) Year dollars Period covered Regulatory Review Costs ......................................................................................................... Annualized Monetized Transfers from Federal Government to IPF Medicare Providers ........ 0.012164 70 2025 FY 2026 2025 FY 2026 F. Regulatory Flexibility Act (RFA) The RFA requires agencies to analyze options for regulatory relief of small entities if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. The great majority of mpact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. The great majority of hospitals and most other health care providers and suppliers are small entities, either by being nonprofit organizations or by meeting the Small Business Administration (SBA) definition of a small business (having revenues of less than $47 million in any 1 year as of 2023 35). According to the SBA’s website at http://www.sba.gov/content/small- business-size-standards, IPFs fall into the North American Industrial Classification System (NAICS) code 622210, Psychiatric and Substance Abuse hospitals. The SBA defines small Psychiatric and Substance Abuse hospitals as businesses having less than $47 million in total annual revenue. As discussed earlier in this final rule, the only costs imposed by this final rule are the regulatory review costs, which we estimate at $221.17 per IPF. However, as discussed in section VI.B.3. of this final rule, the removal of the Facility Commitment to Health Equity, Screening for Social Drivers of Health, and Screen Positive Rate for Social Drivers of Health discussed in section VI.B.3. of this final rule, the removal of the Facility Commitment to Health Equity, Screening for Social Drivers of Health, and Screen Positive Rate for Social Drivers of Health measures from the IPFQR Program result in an estimated decrease in cost of $1,094 per IPF. As a result, there are negative costs (that is, savings) of $872.83 per IPF imposed as a result of this final rule. TABLE 14—NAICS 622210 PSYCHIATRIC AND SUBSTANCE ABUSE HOSPITALS SIZE STANDARDS NAICS (6-digit) Industry subsector description SBA size standard/small entity threshold Total small businesses 622210 ..................................... Psychiatric and Substance Abuse Hospitals ........................... $47 Million ............................... 200 Source: US Census 2022 SUSB. TABLE 15—CONCENTRATION RATIOS (NAICS 622210) PSYCHIATRIC AND SUBSTANCE ABUSE HOSPITALS Firm size (by receipts) Firm count % of small firms Average revenue Small Hospitals: ................................................................................................... 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 ............................................................ 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o l Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations 37675 TABLE 15—CONCENTRATION RATIOS (NAICS 622210) PSYCHIATRIC AND SUBSTANCE ABUSE HOSPITALS—Continued Firm size (by receipts) Firm count % of small firms Average revenue Large Hospitals: Receipts > 49 million ........................................................................................... 218 NA 296,853,795.10 Source: US Census 2022 SUSB. TABLE 16—(NAICS 622210) PSYCHIATRIC AND SUBSTANCE ABUSE HOSPITALS IMPACTS ON SMALL ENTITES Firm size (by receipts) Avg. annual revenue Annualized cost per firm % of small firms Revenue test (%) All Hospitals ............................................................................. Small Hospitals ........................................................................ 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o ...................................... 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o l 37676 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations I. E.O. 14192, ‘‘Unleashing Prosperity Through Deregulation’’ Medicaid Services amends 42 CFR part 412 as set forth below: Executive Order 14192, entitled ‘‘Unleashing Prosperity Through Deregulation’’ was issued on January 31, 2025, and requires that ‘‘any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least 10 prior regulations.’’ This final rule is considered an E.O. 14192 deregulatory action. We estimate that this rule will generate $24 million in annualized cost savings at a 7 percent discount rate, discounted relative to year 2024, over a perpetual time horizon. This final regulation is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.) and has been transmitted to the Congress and the Comp ion is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.) and has been transmitted to the Congress and the Comptroller General for review. Mehmet Oz, Administrator of the Centers for Medicare & Medicaid Services, approved this document on July, 21, 2025. List of Subjects in 42 CFR Part 412 Administrative practice and procedure, Health facilities, Medicare, Puerto Rico, Reporting and recordkeeping requirements. For the reasons set forth in the preamble, the Centers for Medicare & PART 412—PROSPECTIVE PAYMENT SYSTEMS FOR INPATIENT HOSPITAL SERVICES ■ 1. The authority citation for part 412 continues to read as follows: Authority: 42 U.S.C. 1302 and 1395hh. ■ 2. Section 412.433 is amended by revising paragraph (f) to read as follows: § 412.433 Procedural requirements under the IPFQR Program. * * (f) Extraordinary Circumstance * * * Exception (ECE)—(1) General rule. CMS may grant an extraordinary circumstance exception (ECE) with respect to the reporting requirements under this section in the event of extraordinary circumstances beyond the control of the IPF. For purposes of this paragraph (f), an e stance exception (ECE) with respect to the reporting requirements under this section in the event of extraordinary circumstances beyond the control of the IPF. For purposes of this paragraph (f), an extraordinary circumstance is an event beyond the control of an IPF (for example, a natural or man-made disaster such as a hurricane, tornado, earthquake, terrorist attack, or bombing) that affected the ability of the IPF to comply with one or more applicable reporting requirements with respect to a fiscal year. (2) Process for requesting an ECE. (i) An IPF may request an ECE within 60 calendar days of the date that the extraordinary circumstance occurred by submitting the information specified by CMS at QualityNet or a successor website. (ii) CMS notifies the IPF of its decision on the request, in writing, via email. In the event that CMS grants an ECE to the IPF, the written decision will specify whether the IPF is exempted from one or more reporting requirements or whether CMS has granted the IPF an extension of time to comply with one or more reporting requirements. (3) Authority to grant an ECE. CMS may grant an ECE to one or more IPFs that have not requested an ECE if CMS determin d the IPF an extension of time to comply with one or more reporting requirements. (3) Authority to grant an ECE. CMS may grant an ECE to one or more IPFs that have not requested an ECE if CMS determines that— (i) A systemic problem with a CMS data collection system directly impacted the ability of the IPF to comply with a quality data reporting requirement, or (ii) An extraordinary circumstance has affected an entire region or locale. Any ECE granted under this paragraph (f)(3) will specify whether the affected IPFs are exempted from one or more reporting requirements or whether CMS has granted the IPF an extension of time to comply with one or more reporting requirements. * * * * * Robert F. Kennedy, Jr., Secretary, Department of Health and Human Services. [FR Doc. 2025–14781 Filed 8–1–25; 4:15 pm] BILLING CODE 4120–01–P 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o l VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00050 Fmt 4701 Sfmt 9990 E:\FR\FM\05AUR2.SGM 05AUR2