Medicare Program; FY 2026 Inpatient Psychiatric Facilities Prospective Payment System-Rate Update , because caps are awarded to IPPS hospitals which receive both direct GME payments and indirect medical education (IME) payments under the IPPS. Section 4122 of the CAA, 2023 provided for the distribution of at least 100 resident FTEs to be distributed for hospitals with a psychiatry or psychiatry subspecialty residency, which the CAA, 2023 defines as a residency in psychiatry as accredited by the Accreditation Council for Graduate Medical Education for the purpose of preventing, diagnosing, and treating mental health disorders. Hospitals with a psychiatry or psychiatry subspecialty residency could include not only acute care hospitals paid under the IPPS, but also freestanding psychiatric hospitals paid under the IPF PPS. The CAA, 2023 also included a provision for IME payments under the IPPS, which stated that for discharges occurring on or after July 1, 2026, insofar as an additional payment amount under section 4122 is attributable to resident positions distributed to a hospital that is identified under subsection (h)(10), the indirect teaching adjustment factor would be computed in the same manner as provided under section 1886(d)(5)(B)(ii) with respect to such resident posit hat is identified under subsection (h)(10), the indirect teaching adjustment factor would be computed in the same manner as provided under section 1886(d)(5)(B)(ii) with respect to such resident positions (in other words, utilizing 1.35 as the value of ‘‘c’’ in the adjustment formula). We note that IPF hospitals paid under the IPF PPS are not considered a hospital under subsection (h)(10) and do not receive IME VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00023 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 37650 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations payments paid under the IPPS, under section 1886(d)(5)(B) of the Act. Historically, the IPF PPS teaching adjustment at § 412.424 has not recognized permanent resident cap increases, which, as we noted earlier, have historically impacted GME payments and IME payments under the IPPS. However, current regulations at § 412.424(d)(1)(iii)(D) allow for an adjustment to an IPF’s resident FTE cap for a new approved GME program. When we initially established this regulation in the RY 2005 IPF PPS final rule (69 FR 66955 412.424(d)(1)(iii)(D) allow for an adjustment to an IPF’s resident FTE cap for a new approved GME program. When we initially established this regulation in the RY 2005 IPF PPS final rule (69 FR 66955 and 66956), we explained that for new teaching IPFs and for teaching IPFs that start new programs, we were adopting the policy that was applied under the BBA for IPPS teaching hospitals that start new teaching programs as specified in § 413.79(e)(1). We noted that under § 412.105(f)(1)(vi) concerning IME payments under the IPPS, hospitals that have shared residency rotational relationships may elect to apply their respective IME resident caps on an aggregate basis via a Medicare GME affiliation agreement. We explained that our intent was not to affect affiliation agreements and rotational arrangements for hospitals that have residents that train in more than one hospital. We did not implement a provision concerning affiliation agreements specifically pertaining to the FTE caps used in the teaching adjustment under the IPF PPS. We also stated that we believe these policies fairly balance our responsibilities under the statute to assure appropriate enforcement of the BBA and the overall teaching adjustment under the IPF PPS. We also stated that we believe these policies fairly balance our responsibilities under the statute to assure appropriate enforcement of the BBA and the overall limits on payment adjustments for teaching hospitals with the greater precision that can be achieved by adjusting payments for teaching IPFs. We also stated that we believe that we have designed a cap that balances the need for limits with the unique conditions of teaching programs in freestanding psychiatric hospitals and in distinct part psychiatric units. We noted in our RY 2005 IPF PPS final rule establishing the teaching adjustment, however, that we would monitor the impact of these policies closely and consider changes in the future when appropriate (69 FR 66954 through 66957). In summary, the CAA, 2023 provides for the distribution of at least 100 psychiatry or psychiatry subspecialty resident FTEs and provides for corresponding increases to IME payments under the IPPS but makes no provisions pertaining to the indirect operating costs for IPFs with teaching programs. For FY 2026, we proposed to recognize resident FTE cap increases that are awarded under section 4122 of the CAA, provisions pertaining to the indirect operating costs for IPFs with teaching programs. For FY 2026, we proposed to recognize resident FTE cap increases that are awarded under section 4122 of the CAA, 2023, either to an IPF hospital or to an IPPS hospital for resident FTEs that are allocated to the IPF subunit paid under the IPF PPS. Specifically, we proposed that such resident FTE cap increases would align with our current IPF PPS teaching regulation at § 412.424(d)(1)(iii)(D), which allows for increases to IPF resident FTE caps for a new approved graduate medical education program. As we previously noted, we established the teaching cap policy under the IPF PPS to maintain alignment with the requirements of the BBA that applied to IME payments under the IPPS, and we have noted that § 412.424(d)(1)(iii)(D) is intended to achieve the same purpose. We stated that we believe this proposal would be consistent with our current regulation and our longstanding policy of maintaining IPF PPS teaching cap policies that align with IME cap policies under the IPPS. We further stated that we believe this proposal would continue to appropriately limit the incentives for IPFs to add FTE residents aching cap policies that align with IME cap policies under the IPPS. We further stated that we believe this proposal would continue to appropriately limit the incentives for IPFs to add FTE residents for the purpose of increasing their teaching adjustment. We solicited comments on the proposed update to the IPF PPS teaching policy. The following is a summary of the comments we received and our responses. Comment: Commenters broadly supported our proposal to recognize resident FTE cap increases awarded under section 4122 of the CAA, 2023, either to an IPF hospital or to an IPPS hospital for resident FTEs that are allocated to the IPF subunit paid under the IPF PPS. Commenters stated that this proposal would support the development of the IPF clinical workforce and would increase IPFs’ capacity to meet patient needs. Commenters expressed that this proposal is especially important due to the shortage of psychiatrists nationwide. Response: We appreciate the support of commenters. We agree with commenters about the importance of supporting the clinical workforce for IPF hospitals and units. We agree that IPF patients have unique needs, and we believe this proposed policy would help IPFs with commenters about the importance of supporting the clinical workforce for IPF hospitals and units. We agree that IPF patients have unique needs, and we believe this proposed policy would help IPFs to better meet those needs. Comment: Several commenters requested that CMS make changes to the Medicare cost report to allow IPFs to increase their resident caps. A commenter requested that CMS work with the Medicare Administrative Contractors to ensure that adjusted FTEs align with the program’s slots awarded under section 4122. A commenter further noted that hospitals are instructed to reduce their IME applications for section 4122 slots for any portion of an FTE that is working in an IPF hospital or unit. Response: We thank commenters for their careful consideration of the proposal. We will issue revised instructions and guidance to the Medicare Administrative Contractors in the near future. We intend to make updates to Worksheet E–3, Part II of the Medicare Hospital Cost Report (CMS– 2552–10, OMB No. 0938–0050) to enable IPFs to document the additional FTEs awarded under section 4122 of the CAA, 2023, that are allocated to an IPF hospital or IPF unit that is paid under the IPF PPS 2552–10, OMB No. 0938–0050) to enable IPFs to document the additional FTEs awarded under section 4122 of the CAA, 2023, that are allocated to an IPF hospital or IPF unit that is paid under the IPF PPS. We are clarifying that we will not include FTE increases that are awarded under section 4122 of the CAA, 2023, in an IPF’s teaching cap if those FTE increases are included in any IME cap increases for the same hospital. Comment: Several commenters suggested that we adopt the same policy with respect to FTE cap slots awarded under section 126 of the CAA, 2021. A commenter stated that in the first three rounds of section 126 awards, CMS distributed 139.72 DGME slots and 90.78 IME slots to teaching hospitals that applied for funding to expand psychiatry and psychiatric subspecialty programs, even though the statute did not specify that the slots must be awarded for psychiatry residencies. Response: We appreciate the commenters’ suggestion, but we note that we did not propose to recognize slots awarded under section 126 of the CAA, 2021. As commenters pointed out, section 4122 of the CAA, 2023, is uniquely focused on psychiatry and psychiatric subspecialty residency slots. We are not fin ots awarded under section 126 of the CAA, 2021. As commenters pointed out, section 4122 of the CAA, 2023, is uniquely focused on psychiatry and psychiatric subspecialty residency slots. We are not finalizing any change to the FTE teaching adjustment policy with regard to section 126 of the CAA, 2021, but we will take these comments into consideration to potentially inform future rulemaking. Comment: Some commenters suggested that CMS should reconsider its cap policy for the IPF teaching adjustment, noting that CMS has broad authority to determine the application of caps to the IPF PPS teaching adjustment. Response: As we previously noted, we established the teaching cap policy under the IPF PPS to maintain alignment with the requirements of the BBA that applied to IME payments under the IPPS. We believe that the current policy fairly balances our responsibilities under the statute to assure appropriate enforcement of the BBA and the overall limits on payment adjustments for teaching hospitals with the greater precision that can be achieved by adjusting payments for teaching IPFs. We will continue to VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00024 Fmt 4701 Sfmt 470 spitals with the greater precision that can be achieved by adjusting payments for teaching IPFs. We will continue to VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00024 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 37651 monitor the impact of these policies closely and may consider changes in the future if appropriate. Final Decision: After consideration of the comments, we are finalizing our proposal to recognize resident FTE cap increases awarded under section 4122 of the CAA, 2023, either to an IPF hospital or to an IPPS hospital for resident FTEs that are allocated to the IPF subunit paid under the IPF PPS. 7. Cost of Living Adjustment for IPFs Located in Alaska and Hawaii The IPF PPS includes a payment adjustment for IPFs located in Alaska and Hawaii based upon the area in which the IPF is located. As we explained in the RY 2005 IPF PPS final rule, the FY 2002 data demonstrated that IPFs in Alaska and Hawaii had per diem costs that were disproportionately higher than other IPFs. As a result of this analysis, we prov e RY 2005 IPF PPS final rule, the FY 2002 data demonstrated that IPFs in Alaska and Hawaii had per diem costs that were disproportionately higher than other IPFs. As a result of this analysis, we provided a COLA in the RY 2005 IPF PPS final rule. We refer readers to the FY 2024 IPF PPS final rule for a complete discussion of the currently applicable COLA factors (88 FR 51088 and 51089). In the FY 2013 IPPS/LTCH final rule (77 FR 53700 and 53701), we established a new methodology to update the COLA factors for Alaska and Hawaii and adopted this methodology for the IPF PPS in the FY 2015 IPF PPS final rule (79 FR 45958 through 45960). We also specified that the COLA updates will be determined every 4 years, in alignment with the IPPS market basket labor-related share update (79 FR 45958 through 45960). Because the labor-related share of the IPPS market basket was updated for FY 2022, the COLA factors were updated in FY 2022 IPPS/LTCH rulemaking (86 FR 45547) reflecting CPI data through 2020. As such, we also finalized an update to the IPF PPS COLA factors in the FY 2022 IPF PPS final rule to reflect the updated COLA factors finalized in the FY 2022 IPPS/LTCH rulemaking effective for 020. As such, we also finalized an update to the IPF PPS COLA factors in the FY 2022 IPF PPS final rule to reflect the updated COLA factors finalized in the FY 2022 IPPS/LTCH rulemaking effective for FY 2022 through FY 2025 (86 FR 42621 and 42622). Generally, under our existing methodology, we update the 2009 COLA factors published by the U.S. Office of Personnel Management (OPM) by a comparison of the growth in the Consumer Price Indices (CPIs) for the areas of Urban Alaska and Urban Hawaii, relative to the growth in the CPI for the average U.S. city as published by the Bureau of Labor Statistics (BLS). Using the respective CPI commodities index and CPI services index and using the approximate commodities/services shares obtained from the IPPS market basket, we create reweighted CPIs for each of the respective areas to reflect the underlying composition of the IPPS market basket nonlabor-related share. Lastly, we apply a 25 percent cap, which was incorporated into our methodology to reflect the statutory cap used to calculate OPM’s COLA factors. For a complete discussion, we refer readers to the FY 2015 IPF PPS final rule (79 FR 45958 through 45960) as well as the FY 2022 IPF PPS eflect the statutory cap used to calculate OPM’s COLA factors. For a complete discussion, we refer readers to the FY 2015 IPF PPS final rule (79 FR 45958 through 45960) as well as the FY 2022 IPF PPS final rule (86 FR 42621 and 42622). Table 3 lists the COLA factors for IPFs located in Alaska and Hawaii as calculated under our current methodology, using updated CPI data through 2024 and the approximate 60 percent commodities/40 percent services shares obtained from the 2023- based IPPS market basket. TABLE 3—IPF PPS COST-OF-LIVING ADJUSTMENT FACTORS: IPFs LOCATED IN ALASKA AND HAWAII Area FY 2022 through FY 2025 COLA factors Updated COLA factors under current methodology Difference Alaska: City of Anchorage and 80-kilometer (50-mile) radius by road ............................................. City of Fairbanks and 80-kilometer (50-mile) radius by road .............................................. City of Juneau and 80-kilometer (50-mile) radius by road .................................................. Rest of Alaska ...................................................................................................................... Hawaii: City and County of Honolulu .......... ................... Rest of Alaska ...................................................................................................................... Hawaii: City and County of Honolulu ................................................................................................ County of Hawaii .................................................................................................................. County of Kauai .................................................................................................................... County of Maui and County of Kalawao .............................................................................. 1.22 1.22 1.22 1.24 1.25 1.22 1.25 1.25 1.18 1.18 1.18 1.20 1.25 1.21 1.25 1.25 ¥0.04 ¥0.04 ¥0.04 ¥0.04 0 ¥0.01 0 0 In the FY 2026 IPF PPS proposed rule, we stated that we believe it is appropriate to have a consistent policy approach with that of other hospitals in Alaska and Hawaii. We explained that we believe it would be appropriate to maintain the current COLA factors to allow CMS to consider whether any other data sources or methodology changes may improve the adjustment we make to hospital payments that accounts for the priate to maintain the current COLA factors to allow CMS to consider whether any other data sources or methodology changes may improve the adjustment we make to hospital payments that accounts for the unique circumstances of hospitals located in Alaska and Hawaii. Therefore, we proposed to continue to use the FY 2025 COLA factors to adjust the non-labor-related portion of the standardized amount for IPFs located in Alaska and Hawaii for FY 2026. Comment: A commenter suggested reevaluating the COLA factors for IPFs located in Alaska and Hawaii annually due to the rise in cost of living and economic instability. The commenter also suggested the formation of a committee to inform future rate adjustments. Response: We appreciate the commenter’s suggestions; however, we did not propose the specific policies suggested by the commenter. As discussed earlier in this section, we believe it is appropriate to have a consistent policy approach with that of other hospitals in Alaska and Hawaii. At this time, we continue to believe our current methodology for calculating the COLA factors for IPFs located in Alaska and Hawaii is appropriate. Final Decision: After consideration of the public comme this time, we continue to believe our current methodology for calculating the COLA factors for IPFs located in Alaska and Hawaii is appropriate. Final Decision: After consideration of the public comments received, we are maintaining the current (FY 2025) IPF PPS COLA factors as proposed, for FY 2026. For a complete discussion of the final FY 2026 COLA factors, including a summary of comments received under the IPPS, we refer readers to the FY 2026 IPPS/LTCH final rule, published elsewhere in the Federal Register. Table 4 lists the final FY 2026 COLA factors. The final IPF PPS COLA factors for FY 2026 are also shown in Addendum A to this final rule, which is available on the CMS website at https://www.cms.gov/Medicare/ Medicare-Fee-for-Service-Payment/ InpatientPsychFacilPPS/tools.html. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00025 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 37652 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations TABLE 4—FINAL FY 2026 COST OF LIVING ADJUSTMENT (COLA) FACTORS: IPFs LOCATED IN ALASKA AND HAWAII Area Final COLA Alaska: City of Ancho l. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations TABLE 4—FINAL FY 2026 COST OF LIVING ADJUSTMENT (COLA) FACTORS: IPFs LOCATED IN ALASKA AND HAWAII Area Final COLA Alaska: City of Anchorage and 80-kilometer (50-mile) radius by road ............................................................................................... City of Fairbanks and 80-kilometer (50-mile) radius by road ................................................................................................ City of Juneau and 80-kilometer (50-mile) radius by road .................................................................................................... Rest of Alaska ........................................................................................................................................................................ Hawaii: City and County of Honolulu .................................................................................................................................................. County of Hawaii .............................................................................................................................................................. ........................ County of Hawaii .................................................................................................................................................................... County of Kauai ...................................................................................................................................................................... County of Maui and County of Kalawao ................................................................................................................................ 1.22 1.22 1.22 1.24 1.25 1.22 1.25 1.25 8. Adjustment for IPFs With a Qualifying ED The IPF PPS includes a facility-level adjustment for IPFs with qualifying EDs. As defined in § 412.402, qualifying emergency department means an emergency department that is staffed and equipped to furnish a comprehensive array of emergency services and meets the requirements of § 489.24(b) and § 413.65. We provide an adjustment to the Federal per diem base rate to account for the costs associated with maintaining a full-service ED. The adjustment is intended to account for ED costs incurred by a psychiatric hospital with a qualifying ED, or an excluded rate to account for the costs associated with maintaining a full-service ED. The adjustment is intended to account for ED costs incurred by a psychiatric hospital with a qualifying ED, or an excluded psychiatric unit of an IPPS hospital or a critical access hospital (CAH), and the overhead cost of maintaining the ED. This payment applies to all IPF admissions (with one exception which we describe in this section), regardless of whether the patient was admitted through the ED. The ED adjustment is made on every qualifying claim except as described in this section of this final rule. As specified at § 412.424(d)(1)(v)(B), the ED adjustment is not made when a patient is discharged from an IPPS hospital or CAH and admitted to the same IPPS hospital’s or CAH’s excluded psychiatric unit. We clarified in the RY 2005 IPF PPS final rule (69 FR 66960) that an ED adjustment is not made in this case because the costs associated with ED services are reflected in the DRG payment to the IPPS hospital or through the reasonable cost payment made to the CAH. In the FY 2025 IPF PPS final rule, we updated the adjustment factor from 1.31 to 1.54 for IPFs with qualifying EDs using the same methodology u or through the reasonable cost payment made to the CAH. In the FY 2025 IPF PPS final rule, we updated the adjustment factor from 1.31 to 1.54 for IPFs with qualifying EDs using the same methodology used to determine ED adjustments in prior years (89 FR 64636). Beginning in FY 2025, IPFs with a qualifying ED receive an adjustment factor of 1.54 as the variable per diem adjustment for day 1 of each patient stay. If an IPF does not have a qualifying ED, it receives an adjustment factor of 1.27 as the variable per diem adjustment for day 1 of each patient stay. For FY 2026, we proposed to maintain the 1.54 adjustment factor for IPFs with qualifying EDs. A complete discussion of the steps involved in the most recent calculation of the ED adjustment factor can be found in the FY 2025 IPF PPS final rule (89 FR 64636). Lastly, we note that following display of the FY 2026 IPF PPS proposed rule with comment period, we identified a typographical error in the preamble text regarding the FY 2025 adjustment factor for IPFs with qualifying EDs. On page 18513, in the first column, in the last paragraph, we made a typographical error and stated the current (FY 2025) adjustment factor was updated adjustment factor for IPFs with qualifying EDs. On page 18513, in the first column, in the last paragraph, we made a typographical error and stated the current (FY 2025) adjustment factor was updated ‘‘from 1.31 to 1.53’’ instead of ‘‘from 1.31 to 1.54’’. We note that the correct FY 2025 adjustment factor for IPFs with qualifying EDs (that is, 1.54) is stated on page 18506, in Table 2; and in Addendum A of the FY 2026 IPF PPS proposed rule with comment period. We did not receive any comments on the proposal to maintain the existing ED adjustment factor for FY 2026, and we are finalizing it as proposed. 9. Refinement Standardization Factor Section 1886(s)(5)(D)(iii) of the Act provides that revisions in payment implemented pursuant to section 1886(s)(5)(D)(i) for a rate year shall result in the same estimated amount of aggregate expenditures under Title XVIII of the Act for psychiatric hospitals and psychiatric units furnished in the RY as would have been made under this Title for such care in such rate year if such revisions had not been implemented. We interpret this to mean that revisions in payment adjustments implemented for FY 2026 (and for any subsequent fiscal year) must be care in such rate year if such revisions had not been implemented. We interpret this to mean that revisions in payment adjustments implemented for FY 2026 (and for any subsequent fiscal year) must be budget neutral. Historically, we have maintained budget neutrality in the IPF PPS using the application of a standardization factor, which is codified in our regulations at § 412.424(c)(5) to account for the overall positive effects resulting from the facility-level and patient-level adjustments. As discussed in section IV.B.1 of this final rule, section 124(a)(1) of the BBRA required that we implement the IPF PPS in a budget neutral manner. In other words, the amount of total payments under the IPF PPS, including any payment adjustments, must be projected to be equal to the amount of total payments that would have been made if the IPF PPS were not implemented. Therefore, we calculated the standardization factor by setting the total estimated IPF PPS payments, taking into account all of the adjustment factors under the IPF PPS, to be equal to the total estimated payments that would have been made using TEFRA methodology had the IPF PPS not been implemented. A step-by-step description o e adjustment factors under the IPF PPS, to be equal to the total estimated payments that would have been made using TEFRA methodology had the IPF PPS not been implemented. A step-by-step description of the methodology used to estimate payments under the TEFRA payment system appears in the RY 2005 IPF PPS final rule (69 FR 66926). We believe the budget neutrality requirement of section 1886(s)(5)(D)(iii) of the Act is consistent with our longstanding methodology for maintaining budget neutrality under the IPF PPS pursuant to section 124(a)(1) of the BBRA. We note that for the FY 2025 IPF PPS rule (89 FR 64640 and 64641), we applied a refinement standardization factor to the FY 2024 IPF Federal per diem base rate and ECT per treatment amount to maintain budget neutrality for the change in the patient-level adjustment factors, ED adjustment, and ECT per treatment amount finalized in the FY 2025 IPF PPS rule. Therefore, for FY 2026, we proposed to apply a refinement standardization factor in accordance with our existing policy at § 412.424(c)(5). Under this policy, we would update IPF PPS adjustment factors for teaching status and for IPFs located in rural areas, as finalized in this F in accordance with our existing policy at § 412.424(c)(5). Under this policy, we would update IPF PPS adjustment factors for teaching status and for IPFs located in rural areas, as finalized in this FY 2026 IPF PPS final rule, in such a way that total estimated payments to IPFs for FY 2026 are the same with or without the changes (that is, in a budget neutral manner) by VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00026 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 37653 applying a refinement standardization factor to the IPF PPS rates. We proposed to use the following steps to ensure that the rates reflect the final FY 2026 update to the facility-level adjustment factors (as previously discussed in sections IVII.D.5 and IV.D.6. of this final rule and summarized in Addendum A) in a budget neutral manner: Step 1: Simulate estimated IPF PPS payments using the FY 2025 IPF facility-level adjustment factor values (available on the CMS website). Step 2: Simulate estimated IPF PPS payments using the final FY 2026 IPF facility- timated IPF PPS payments using the FY 2025 IPF facility-level adjustment factor values (available on the CMS website). Step 2: Simulate estimated IPF PPS payments using the final FY 2026 IPF facility-level adjustment factor values (see Addendum A of this final rule, which is available on the CMS website). Step 3: Divide the amount calculated in step 1 by the amount calculated in step 2. The resulting quotient is the final FY 2026 refinement standardization factor of 0.9927. Step 4: Apply the FY 2026 refinement standardization factor from step 3 to the FY 2025 IPF PPS Federal per diem base rate and ECT per treatment amount, after the application of the wage index budget neutrality factor and the IPF market basket increase reduced by the productivity adjustment described in section IV.A. of this final rule to determine the final FY 2026 IPF PPS Federal per diem base rate and FY 2026 ECT payment amount per treatment. E. Other Payment Adjustments and Policies 1. Outlier Payment Overview The IPF PPS includes an outlier adjustment to promote access to IPF care for those patients who require expensive care and to limit the financial risk of IPFs treating unusually costly patients. In the e IPF PPS includes an outlier adjustment to promote access to IPF care for those patients who require expensive care and to limit the financial risk of IPFs treating unusually costly patients. In the RY 2005 IPF PPS final rule, we implemented regulations at § 412.424(d)(3)(i) to provide a per case payment for IPF stays that are extraordinarily costly. Providing additional payments to IPFs for extremely costly cases strongly improves the accuracy of the IPF PPS in determining resource costs at the patient- and facility-level. These additional payments reduce the financial losses that would otherwise be incurred in treating patients who require costlier care; therefore, reduce the incentives for IPFs to under-serve these patients. We make outlier payments for discharges where an IPF’s estimated total cost for a case exceeds a fixed dollar loss threshold amount (multiplied by the IPF’s facility-level adjustments) plus the Federal per diem payment amount for the case. In instances when the case qualifies for an outlier payment, we pay 80 percent of the difference between the estimated cost for the case and the adjusted threshold amount for days 1 through 9 of the stay (consistent with case qualifies for an outlier payment, we pay 80 percent of the difference between the estimated cost for the case and the adjusted threshold amount for days 1 through 9 of the stay (consistent with the median LOS for IPFs in FY 2002), and 60 percent of the difference for day 10 and thereafter. The adjusted threshold amount is equal to the outlier threshold amount adjusted for wage area, teaching status, rural area, and the COLA factor (if applicable), plus the amount of the Medicare IPF payment for the case. We established the 80 percent and 60 percent loss sharing ratios because we were concerned that a single ratio established at 80 percent (like other Medicare PPSs) might provide an incentive under the IPF per diem payment system to increase LOS to receive additional payments. After establishing the loss sharing ratios, we determined the current fixed dollar loss threshold amount through payment simulations designed to compute a dollar loss beyond which payments are estimated to meet the 2 percent outlier spending target. Each year when we update the IPF PPS, we simulate payments using the latest available data to compute the fixed dollar loss threshold so that outlier payment eet the 2 percent outlier spending target. Each year when we update the IPF PPS, we simulate payments using the latest available data to compute the fixed dollar loss threshold so that outlier payments represent 2 percent of total estimated IPF PPS payments. 2. Update to the Outlier Fixed Dollar Loss Threshold Amount In accordance with the update methodology described in § 412.428(d), we proposed to update the fixed dollar loss threshold amount used under the IPF PPS outlier policy. Based on the regression analysis and payment simulations used to develop the IPF PPS, we established a 2 percent outlier policy, which strikes an appropriate balance between protecting IPFs from extraordinarily costly cases while ensuring the adequacy of the Federal per diem base rate for all other cases that are not outlier cases. We proposed to maintain the established 2 percent outlier policy for FY 2026. Our longstanding methodology for updating the outlier fixed dollar loss threshold involves using the best available data, which is typically the most recent available data. We note that for FY 2022 and FY 2023 only, we made certain methodological changes to our modeling of outlier payments, and we d best available data, which is typically the most recent available data. We note that for FY 2022 and FY 2023 only, we made certain methodological changes to our modeling of outlier payments, and we discussed the specific circumstances that led to those changes for those years (86 FR 42623 and 42624; 87 FR 46862 through 46864). We direct readers to the FY 2022 and FY 2023 IPF PPS proposed and final rules for a more complete discussion. We proposed to update the IPF outlier threshold amount for FY 2026 using FY 2024 claims data and the same methodology that we have used to set the initial outlier threshold amount each year beginning with the RY 2007 IPF PPS final rule (71 FR 27072 and 27073). For this FY 2026 IPF PPS rulemaking, consistent with our longstanding practice, based on an analysis of the latest available data (the December 2024 update of FY 2024 IPF claims) and rate increases, we believe it is necessary to update the fixed dollar loss threshold amount to maintain an outlier percentage that equals 2 percent of total estimated IPF PPS payments. Based on an analysis of these updated data, we estimated that IPF outlier payments as a percentage of total estimated payments woul ercentage that equals 2 percent of total estimated IPF PPS payments. Based on an analysis of these updated data, we estimated that IPF outlier payments as a percentage of total estimated payments would be slightly higher than 2.0 percent in FY 2025. Therefore, we proposed to update the outlier threshold amount to $39,360 to maintain estimated outlier payments at 2 percent of total estimated aggregate IPF payments for FY 2026. The proposed update would be an increase from the FY 2025 threshold of $38,110. Lastly, we proposed that if more recent data become available for the FY 2026 IPF PPS final rule, we would consider using such data to determine the final outlier fixed dollar loss threshold amount for FY 2026. We solicited comments on the proposed update to the outlier fixed dollar loss threshold amount. The following is a summary of the comments we received and our responses. Comment: A commenter expressed concern about CMS’s proposal to raise the IPF outlier fixed-loss threshold to $39,360 for FY 2026. The commenter stated the proposed threshold is too high and will reduce the number of cases qualifying for outlier payment relief. The commenter expressed concern about the impact $39,360 for FY 2026. The commenter stated the proposed threshold is too high and will reduce the number of cases qualifying for outlier payment relief. The commenter expressed concern about the impact on facilities that treat the most medically complex or violent psychiatric patients, as this creates significant financial risk for these specialized providers. Response: The proposed increase in the IPF outlier fixed-loss threshold from $38,110 to $39,360 is intended to maintain budget neutrality by ensuring outlier payments remain at approximately 2.0 percent of total IPF payments as required by statute, reflect cost inflation to account for general cost increases in healthcare delivery, and preserve program integrity by maintaining the outlier payment system’s role in protecting facilities from truly extraordinary costs. We carefully calibrate the threshold annually using the most recent available cost and claims data, with the 2.0 percent target for outlier payments representing a balance between VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00027 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 37654 Feder ance between VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00027 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 37654 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations providing adequate protection for high- cost cases while maintaining overall payment system stability, supported by historical data analysis to achieve the statutory target. Our analysis indicates that the proposed threshold maintains the appropriate balance between outlier payment availability and budget neutrality, and while the proportion of cases receiving outlier payments may decrease, the total outlier payment pool remains consistent with statutory requirements, with the threshold adjustment reflecting actual cost trends in IPF services. Comment: Two commenters noted concern that the increase in the outlier fixed loss threshold exceeds the proposed 2.4 percent update to IPF rates, creating a disparity that could negatively impact facilities. The commenters specifically requested that CMS consider adopting an alternative methodology used in FY 2022 and FY 2023, which involved removing IPFs with extrem at could negatively impact facilities. The commenters specifically requested that CMS consider adopting an alternative methodology used in FY 2022 and FY 2023, which involved removing IPFs with extremely high or low costs per day (3+ standard deviations from the mean) to create a more homogeneous dataset, as this approach previously helped mitigate increases in the fixed loss threshold and could serve as an effective means of reducing the proposed threshold increase for FY 2026. Response: While the commenters correctly reference our use of statistical trimming methodology in prior years, it is important to clarify that the approach used in FY 2023 (87 FR 46862)—which involved excluding providers whose change in estimated average cost per day fell outside 3 standard deviations from the mean—was implemented as a targeted response to extraordinary data distortions caused by the COVID–19 PHE, rather than as a routine alternative methodology. Specifically, we observed that some providers had significant increases in their charges during the pandemic period, resulting in higher than normal estimated costs per day that would skew outlier payment estimates, and the statistical trim was app d significant increases in their charges during the pandemic period, resulting in higher than normal estimated costs per day that would skew outlier payment estimates, and the statistical trim was applied to improve the validity of the data used for ratesetting under these exceptional circumstances. Our longstanding methodology for updating the outlier fixed-loss threshold continues to rely on using the best available data to maintain outlier payments at 2 percent of total IPF PPS payments, and any deviations from this established approach are carefully considered based on specific data quality concerns rather than as standard practice. We will continue to monitor the IPF PPS outlier policy and propose the application of appropriate statistical methods when necessary to ensure the integrity of the outlier policy while maintaining the balance between protecting facilities from extraordinarily costly cases and ensuring adequacy of the Federal per diem base rate for non- outlier cases. Final Decision: After consideration of the comments received, we are finalizing our proposal to update the fixed dollar loss threshold amount used under the IPF PPS outlier policy. For this FY 2026 IPF nal Decision: After consideration of the comments received, we are finalizing our proposal to update the fixed dollar loss threshold amount used under the IPF PPS outlier policy. For this FY 2026 IPF PPS rulemaking, consistent with our longstanding practice, based on an analysis of the latest available data (the March 2025 update of FY 2024 IPF claims) and rate increases, we believe it is necessary to update the fixed dollar loss threshold amount to maintain an outlier percentage that equals 2 percent of total estimated IPF PPS payments. Based on an analysis of these updated data, we estimate that IPF outlier payments as a percentage of total estimated payments are approximately 2.1 percent in FY 2025. Therefore, we are finalizing an update to the outlier threshold amount to $39,360 to maintain estimated outlier payments at 2 percent of total estimated aggregate IPF payments for FY 2026. 3. Update to IPF Cost-to-Charge Ratio Ceilings Under the IPF PPS, an outlier payment is made if an IPF’s cost for a stay exceeds a fixed dollar loss threshold amount plus the IPF PPS amount. To establish an IPF’s cost for a particular case, we multiply the IPF’s reported charges on the discharge bi IPF’s cost for a stay exceeds a fixed dollar loss threshold amount plus the IPF PPS amount. To establish an IPF’s cost for a particular case, we multiply the IPF’s reported charges on the discharge bill by its overall CCR. This approach to determining an IPF’s cost is consistent with the approach used under the IPPS and other PPSs. In the RY 2004 IPPS final rule (68 FR 34494), we implemented changes to the IPPS policy used to determine CCRs for IPPS hospitals, because we became aware that payment vulnerabilities resulted in inappropriate outlier payments. Under the IPPS, we established a statistical measure of accuracy for CCRs to ensure that aberrant CCR data did not result in inappropriate outlier payments. As indicated in the RY 2005 IPF PPS final rule (69 FR 66961), we believe that the IPF outlier policy is susceptible to the same payment vulnerabilities as the IPPS; therefore, we adopted a method to ensure the statistical accuracy of CCRs under the IPF PPS. Specifically, we adopted the following procedure in the RY 2005 IPF PPS final rule: • Calculated two national ceilings, one for IPFs located in rural areas and one for IPFs located in urban areas. • Computed the ceilings by d the following procedure in the RY 2005 IPF PPS final rule: • Calculated two national ceilings, one for IPFs located in rural areas and one for IPFs located in urban areas. • Computed the ceilings by first calculating the national average and the standard deviation of the CCR for both urban and rural IPFs using the most recent CCRs entered in the most recent Provider Specific File (PSF) available. For FY 2026, we proposed to continue following this methodology. Lastly, we proposed that if more recent data become available, we would consider using such data to calculate the rural and urban national median and ceiling CCRs for FY 2026. To determine the final rural and urban ceilings, we multiplied each of the standard deviations by 3 and added the result to the appropriate national CCR average (either rural or urban). The final upper threshold CCR for IPFs in FY 2026 is 2.4373 for rural IPFs and 1.8305 for urban IPFs, based on current CBSA-based geographic designations. If an IPF’s CCR is above the applicable ceiling, the ratio is considered statistically inaccurate, and we assign the appropriate national (either rural or urban) median CCR to the IPF. We apply the national median CC is above the applicable ceiling, the ratio is considered statistically inaccurate, and we assign the appropriate national (either rural or urban) median CCR to the IPF. We apply the national median CCRs to the following situations: • New IPFs that have not yet submitted their first Medicare cost report. We continue to use these national median CCRs until the facility’s actual CCR can be computed using the first tentatively or final settled cost report. • IPFs whose overall CCR is in excess of three standard deviations above the corresponding national geometric mean (that is, above the ceiling). • Other IPFs for which the Medicare Administrative Contractor (MAC) obtains inaccurate or incomplete data with which to calculate a CCR. We proposed to update the FY 2026 national median and ceiling CCRs for urban and rural IPFs based on the CCRs entered in the latest available IPF PPS PSF. Specifically, for FY 2026, to be used in each of the three situations listed previously, using the most recent CCRs entered in the CY 2024 PSF, we provide an estimated national median CCR of 0.5720 for rural IPFs and a national median CCR of 0.4200 for urban IPFs. These calculations are based on the IPF’s cent CCRs entered in the CY 2024 PSF, we provide an estimated national median CCR of 0.5720 for rural IPFs and a national median CCR of 0.4200 for urban IPFs. These calculations are based on the IPF’s location (either urban or rural) using the current CBSA-based geographic designations. A complete discussion regarding the national median CCRs appears in the RY 2005 IPF PPS final rule (69 FR 66961 through 66964). V. Inpatient Psychiatric Facility Quality Reporting (IPFQR) Program A. Background and Statutory Authority The Inpatient Psychiatric Facilities Quality Reporting (IPFQR) Program is authorized by section 1886(s)(4) of the Act, and it applies to psychiatric VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00028 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 37655 hospitals and psychiatric units paid by Medicare under the IPF PPS (see section II.A. of this final rule for a detailed discussion of entities covered under the IPF PPS).4 5 We refer readers to the FY 2019 IPF PPS final rule (83 FR 38589) for a discussion of th F PPS (see section II.A. of this final rule for a detailed discussion of entities covered under the IPF PPS).4 5 We refer readers to the FY 2019 IPF PPS final rule (83 FR 38589) for a discussion of the background and statutory authority of the IPFQR Program. We have codified procedural requirements and reconsideration and appeals procedures for IPFQR Program decisions in our regulations at 42 CFR 412.433 and 412.434. Consistent with previous IPFQR Program regulations, we refer to both inpatient psychiatric hospitals and psychiatric units as ‘‘inpatient psychiatric facilities’’ (at times, simply ‘‘facilities’’ where the context is clear) or ‘‘IPFs.’’ This usage follows the terminology in our IPF PPS regulations at § 412.402. Section 1886(s)(4)(E) of the Act requires IPFs participating in the IPFQR Program to collect and submit to the Secretary certain standardized patient assessment data, using a standardized patient assessment instrument (PAI) developed by the Secretary, for RY 2028 (FY 2028) and each subsequent rate year. In the FY 2025 IPF PPS proposed rule, we solicited public comment on 4 We note that the statute uses the term ‘‘rate year’’ (RY). However, beginning with the ann Y 2028) and each subsequent rate year. In the FY 2025 IPF PPS proposed rule, we solicited public comment on 4 We note that the statute uses the term ‘‘rate year’’ (RY). However, beginning with the annual update of the inpatient psychiatric facility prospective payment system (IPF PPS) that took effect on July 1, 2011 (RY 2012), we aligned the IPF PPS update with the annual update of the ICD codes, effective on October 1 of each year. This change allowed for annual payment updates and the ICD coding update to occur on the same schedule and appear in the same Federal Register document, promoting administrative efficiency. To reflect the change to the annual payment rate update cycle, we revised the regulations at 42 CFR 412.402 to specify that, beginning October 1, 2012, the IPF PPS RY means the 12-month period from October 1 through September 30, which we refer to as a ‘‘fiscal year’’ (FY) (76 FR 26435). Therefore, with respect to the IPFQR Program, the terms ‘‘rate year,’’ as used in the statute, and ‘‘fiscal year’’ as used in the regulation, both refer to the period from October 1 through September 30. For more information regarding this terminology change, we refer readers to sec he statute, and ‘‘fiscal year’’ as used in the regulation, both refer to the period from October 1 through September 30. For more information regarding this terminology change, we refer readers to section III of the RY 2012 IPF PPS final rule (76 FR 26434 through 26435). 5 For the IPFQR Program, we refer to the year in which an IPF would receive the 2-percentage point reduction to the annual update to the standard Federal rate as the payment determination year. An IPF generally meets IPFQR Program requirements by submitting data on specified quality measures in a specified time and manner during a data submission period that occurs prior to the payment determination year. These data reflect a period prior to the data submission period during which the IPF furnished care to patients; this period is known as the reporting period, sometimes also referred to as the performance period. For example, for a measure for which CY 2026 is the reporting period which is required to be submitted in CY 2027 and affects FY 2028 payment determination, if an IPF did not submit the data for this measure as specified during CY 2027 (and meets all other IPFQR Program requirements for the FY 2028 paymen CY 2027 and affects FY 2028 payment determination, if an IPF did not submit the data for this measure as specified during CY 2027 (and meets all other IPFQR Program requirements for the FY 2028 payment determination) we would reduce by 2-percentage points that IPF’s update for the FY 2028 payment determination year. the principles and approach that CMS should consider when developing the IPF–PAI (89 FR 23200 through 89 FR 23204), which we summarized in the final rule (89 FR 64642 through 64649). B. Modification of the Reporting Period of the 30-Day Risk-Standardized All- Cause Emergency Department Visit Following an IPF Discharge Measure, Beginning With the FY 2029 Payment Determination 1. Background In the FY 2025 IPF PPS final rule, we adopted the 30-Day Risk-Standardized All-Cause Emergency Department (ED) Visit Following an IPF Discharge measure (IPF ED Visit measure) for the IPFQR Program beginning with the FY 2027 payment determination (89 FR 64650 through 89 FR 64659). The measure was adopted with a calendar year (CY) reporting period starting with the CY 2025 reporting period for the FY 2027 payment determination (89 FR 64659).6 We adopted this measure to address a gap in e re was adopted with a calendar year (CY) reporting period starting with the CY 2025 reporting period for the FY 2027 payment determination (89 FR 64659).6 We adopted this measure to address a gap in existing IPFQR Program measures related to patient outcomes in the period following discharge from the IPF (89 FR 64651). While the Thirty Day All-Cause Unplanned Readmission Following Psychiatric Hospitalization measure (IPF Unplanned Readmission measure), adopted in the FY 2017 IPPS/ LTCH PPS final rule (81 FR 57241 through 57246), assesses hospital readmissions, it does not assess another type of post-discharge use of acute care: ED visits that do not result in a hospital admission. Therefore, we adopted the IPF ED Visit measure to fill this gap and to provide IPFs and patients with a more complete picture of acute care among IPF patients after discharge from the IPF (89 FR 64650 through 64659). 2. Modification of the Reporting Period of the IPF ED Visit Measure To Begin Q3 CY 2025–Q2 CY 2027 Reporting Period/ FY 2029 Payment Determination We intended for the IPF ED Visit measure to complement the IPF Unplanned Readmission measure to the extent possible (89 FR 64652 through 64653). O 2027 Reporting Period/ FY 2029 Payment Determination We intended for the IPF ED Visit measure to complement the IPF Unplanned Readmission measure to the extent possible (89 FR 64652 through 64653). Our rationale was that maintaining similarities between these two measures—the same timeframe (that is, the 30 days post-discharge from an IPF), the same definitions of index admission, and same patient populations—would provide IPFs and patients with a more complete picture of acute care among IPF patients after discharge. However, the IPF Unplanned Readmission measure uses a 2-year 6 We note that we used ‘‘performance period’’ in the FY 2025 IPF PPS final rule to refer to the reporting period. reporting period, which differs from the 1-year reporting period we finalized for the IPF ED Visit measure. To fully align the measures so that the same cohort of patients can be compared, it is necessary to modify the reporting period of the IPF ED Visit Measure. For the reasons discussed in the FY 2026 IPF PPS proposed rule, we proposed to modify the current 1-year reporting period for the IPF ED Visit measure to a 2-year reporting period (90 FR 18515 through 18516). We proposed that this 2-ye 2026 IPF PPS proposed rule, we proposed to modify the current 1-year reporting period for the IPF ED Visit measure to a 2-year reporting period (90 FR 18515 through 18516). We proposed that this 2-year reporting period would run 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. The proposed 2-year reporting period for the IPF ED Visit measure would align with the IPF Unplanned Readmission measure. The proposal would modify the first reporting period for the measure to Quarter (Q)3 CY 2025–Q2 CY 2027 for the FY 2029 payment determination.7 The proposed 2-year reporting period would allow the IPF ED Visit measure to better complement the IPF Unplanned Readmission measure, resulting in more meaningful IPFQR Program measure data for providers and consumers. Because the data used to calculate the IPF ED Visit measure are available on Medicare claims and enrollment data, this measure requires no additional data collection or submission by IPFs (89 FR 64667). We did not propose any other changes to the measure. We noted the IPF ED Visit measure for the FY 2029 payment determin sure requires no additional data collection or submission by IPFs (89 FR 64667). We did not propose any other changes to the measure. We noted the IPF ED Visit measure for the FY 2029 payment determination, which would reflect a Q3 CY 2025–Q2 CY 2027 reporting period, would first be publicly reported in the January 2029 release on the Compare tool on medicare.gov (https://www.medicare.gov/care- compare/) or their successor websites. We invited public comments on our proposal to modify the reporting period of the IPF ED Visit Measure. The following is a summary of the comments we received and our responses. Comment: Several commenters expressed support for this proposal, agreeing with CMS on the importance of aligning the reporting periods for related measures. Some commenters supported the expansion to a 2-year reporting period, with one noting that a longer reporting period helps smooth out temporary fluctuations that might happen over a shorter time period. 7 As finalized in prior rulemaking (89 FR 64659), the IPF ED Visit measure would have been used in the FY 2027 payment determination. With modification of the reporting period, we proposed the first year that this measure woul lemaking (89 FR 64659), the IPF ED Visit measure would have been used in the FY 2027 payment determination. With modification of the reporting period, we proposed the first year that this measure would be used in the payment determination to change to FY 2029. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00029 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 37656 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations Other commenters described the proposal as sensible and reasonable. Response: We thank the commenters for their support. Comment: One comment stated concerns about the proposed 2-year reporting period, specifically that the data become outdated, which makes it more challenging for IPFs to make changes in response to measure performance. The commenter recommended that CMS consider modifying the IPF Unplanned Readmission—and not finalizing modifications to the IPF ED Visit measure—so that both measures follow a 12-month reporting cycle, beginning July 1 and ending June 30 the following year. Response: We acknowledge that timeliness can be a limitation of claims- ba isit measure—so that both measures follow a 12-month reporting cycle, beginning July 1 and ending June 30 the following year. Response: We acknowledge that timeliness can be a limitation of claims- based measures. When the IPF Unplanned Readmission measure was developed, the measure developers established that 24 months of data were needed for the measure to be statistically reliable—that is, having sufficient observations in the reporting period for the measure to provide stable estimates, and not be subject to fluctuation due to normal variation in patient outcomes.8 The IPF ED Visit measure was tested with a 24 month observation period in order to be comparable to the IPF Unplanned Readmission measure.9 Because using a shorter reporting period with fewer observations would reduce reliability, we sought to balance sufficient measure reliability with some delay in this information being publicly reported. Final Decision: After consideration of the comments we received, we are finalizing our proposal to modify the reporting period for the IPF ED Visit measure as proposed. C. Removal of the Facility Commitment to Health Equity Measure Beginning With the CY 2024 Reporting Period/FY 2 ng our proposal to modify the reporting period for the IPF ED Visit measure as proposed. C. Removal of the Facility Commitment to Health Equity Measure Beginning With the CY 2024 Reporting Period/FY 2026 Payment Determination We refer readers to the FY 2024 IPF PPS final rule where we adopted the Facility Commitment to Health Equity structural measure (hereafter referred to as FCHE measure) into the IPFQR Program (88 FR 51100 through 51107). In the FY 2026 IPF PPS proposed rule, we proposed to remove the FCHE measure beginning with the FY 2026 payment determination due to the costs associated with achieving a high score on the measure outweighing the benefit of its continued use in the program (90 FR 18516). As we explained in the proposed rule, when CMS first adopted 8 CMS. Internal Analysis. November 2015. 9 https://p4qm.org/measures/4190. the FCHE measure, we intended the collection of data described in the five domains of this measure to provide IPF leadership with meaningful and actionable health data to drive quality improvements to eliminate health disparities. Based on feedback received from IPFs as well as a re-focus on clinical outcomes measures, for which the FCHE measur ctionable health data to drive quality improvements to eliminate health disparities. Based on feedback received from IPFs as well as a re-focus on clinical outcomes measures, for which the FCHE measure, as a structural measure, does not directly measure clinical outcomes, we believed that the burden of collecting this measure may outweigh the benefits. We stated that removal of this measure would alleviate an estimated annual burden of approximately 267 hours, at a cost of $11,978, across all participating IPFs (88 FR 51151). These values were based on the estimated burden at the time the measure was proposed. Elsewhere in the proposed rule, in section V.B.3, we stated the updated burden estimate of 267 hours at a cost of $14,761, across all participating IPFs. The IPFQR Program strives to minimize burden while maintaining a parsimonious set of the most meaningful quality measures and continuing to incentivize improvement in the quality of care provided to patients. Removing this measure from the IPFQR Program is effective toward accomplishing this intent. In the proposed rule, we stated a re-focus on measurable clinical outcomes as well as identifying quality measures on topics of re from the IPFQR Program is effective toward accomplishing this intent. In the proposed rule, we stated a re-focus on measurable clinical outcomes as well as identifying quality measures on topics of prevention, nutrition, and well-being, and as such we referred readers to our request for comment on our Request for Information on Future Measures for the IPFQR Program in section IV.H.2. (90 FR 18516). The IPFQR Program continues to incentivize the improvement of care quality and health outcomes for all patients through measurement and transparency with other measures. It may be costly for IPFs to continue reporting on the FCHE measure and achieve high performance scores, and removal of this measure would make room to enhance the program’s focus on measurable clinical outcomes and for IPF leadership to focus on other priority quality and safety areas. We acknowledge that some IPFs may have expended resources to implement some or all of the activities described in the FCHE measure attestation statements in order to be able to attest ‘‘yes’’ for measure reporting purposes, however, IPFs that had already implemented such activities prior to adoption of the measure would have been able ation statements in order to be able to attest ‘‘yes’’ for measure reporting purposes, however, IPFs that had already implemented such activities prior to adoption of the measure would have been able to attest ‘‘yes’’ without expending similar resources. We stated that, if finalized, IPFs that do not report their CY 2024 reporting period data for the FCHE measure to CMS would not be considered noncompliant with the measure for purposes of their FY 2026 payment determination (that is, IPFs that do not report CY 2024 reporting period data would not be penalized for FY 2026 payments due to this measure). Any FCHE measure data received by CMS would not be used for public reporting or payment purposes. We stated that, if not finalized, IPFs that do not report their CY 2024 reporting data for the FCHE measure to CMS would be considered noncompliant with the measure for their FY 2026 payment determination, and would receive a letter of noncompliance after August 1, 2025, at which time the required 30 day reconsideration period would begin. Payment adjustments for noncompliance with IPFQR Program requirements would apply to FY 2026 fee-for-service claims as previously finalized. We invited uired 30 day reconsideration period would begin. Payment adjustments for noncompliance with IPFQR Program requirements would apply to FY 2026 fee-for-service claims as previously finalized. We invited public comments on our proposal to remove the FCHE structural measure from the IPFQR Program beginning with the FY 2026 payment determination. The following is a summary of the comments we received and our responses. Comment: Many commenters supported the removal of the FCHE measure. Several commenters described burden related to data collection for this measure. Several commenters stated that the measure had limitations and noted that it was redundant with some accreditation requirements from other programs. Response: We thank the commenters for their support. Comment: A few commenters disagreed that the cost of the FCHE measure outweighed the benefit, stating that facility attention to social factors is linked to clinical outcomes, and the focus areas of this measure are likely to prevent downstream costs. Response: We appreciate commenters’ input regarding the burden associated with reporting on the FCHE measure. We agree with commenters that the reporting burden associated with st nt downstream costs. Response: We appreciate commenters’ input regarding the burden associated with reporting on the FCHE measure. We agree with commenters that the reporting burden associated with structural measures is typically small; however, costs are multi-faceted and include administrative costs to IPFs, maintaining information collection systems, and analyzing reported data. We are identifying ways to reduce overall provider burden of participating in the IPFQR Program, while continuing to hold IPFs accountable for measurable aspects of care and patient safety. At this time, we remain focused on identifying measures that balance feasibility, costs, and impact, while aligning with national priorities. For the reasons discussed in the FY 2026 IPF VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00030 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 37657 PPS proposed rule (90 FR 18516), we have determined that the multi-faceted costs associated with this measure outweigh the benefits of its continued use in the program a / Rules and Regulations 37657 PPS proposed rule (90 FR 18516), we have determined that the multi-faceted costs associated with this measure outweigh the benefits of its continued use in the program at this time. Comment: A commenter stated that this measure generates meaningful and useful health data that facilities can use to drive quality improvement. A commenter stated that it would be difficult to advance CMS’ goals of improving overall well-being and whole-person care without identifying and addressing social needs and health disparities. A few commenters stated that removing this measure would reverse or undermine progress made on improving outcomes for all patients. Response: We acknowledge commenters that stated that the types of activities specified for attesting affirmatively on various domains for the FCHE measure—for example, strategic planning to address health equity, collecting information on patient demographics and/or social drivers of health, and using these data to inform quality improvement—support high- quality care and improved outcomes for patients. Removal of this measure does not preclude IPFs from collecting health information on topics that they deem imp inform quality improvement—support high- quality care and improved outcomes for patients. Removal of this measure does not preclude IPFs from collecting health information on topics that they deem important to their patient populations or quality improvement activities. Despite removal of this measure, IPFs will still be able to collect data that is important to their patient care initiatives and reflects the unique needs of their specific patient population. We acknowledge commenters’ concern about the impacts of this measure removal. The IPFQR Program strives to hold IPFs accountable for high-quality healthcare delivery to all beneficiaries, and to focus on measures that are clinically important and meaningful to patients. We regularly review measures in our quality reporting programs, and we remain focused on identifying measures that balance feasibility, burden, and impact. As part of this regular reassessment of the balance of measures in our programs, we have assessed the overall costs of this measure as outweighing the benefits of retaining it in the IPFQR Program at this time. Final Decision: After consideration of the comments we received, we are finalizing, as proposed, o costs of this measure as outweighing the benefits of retaining it in the IPFQR Program at this time. Final Decision: After consideration of the comments we received, we are finalizing, as proposed, our proposal to remove the FCHE structural measure. D. Removal of the COVID–19 Vaccination Coverage Among Healthcare Personnel Measure Beginning With the CY 2024 Reporting Period/FY 2026 Payment Determination We refer readers to the FY 2022 IPF PPS final rule where we adopted the COVID–19 Vaccination Coverage Among Healthcare Personnel (HCP) measure into the IPFQR Program (86 FR 42633 through 42640) and the FY 2024 IPF PPS final rule where we modified the COVID–19 Vaccination Coverage Among HCP measure to account for updated vaccine guidance (88 FR 51128 through 51133). As discussed in the FY 2026 IPF PPS proposed rule (90 FR 18516 through 18517), we proposed to remove the COVID–19 Vaccination Coverage Among HCP measure beginning with the CY 2024 reporting period/FY 2026 payment determination under removal Factor 8, the costs associated with a measure outweigh the benefit of its continued use in the program (§ 412.433(e)(3)(i)(H)). We noted that reporting on this measure currently requi on under removal Factor 8, the costs associated with a measure outweigh the benefit of its continued use in the program (§ 412.433(e)(3)(i)(H)). We noted that reporting on this measure currently requires reporting data on COVID–19 vaccination coverage among HCP for 1 week each month for each of the 3 months in a quarter. This requires IPFs to track current vaccination status for all employees, licensed independent practitioners, adult students/trainers and volunteers, and other contract personnel and log in to the National Healthcare Safety Network (NHSN) to report the data monthly either manually in the NHSN or by uploading a comma- separated value (CSV) file (86 FR 42636). The estimated burden of collecting this information annually across all 1,596 IPFs is between $721,392 and $841,730 annually. We referred readers to section V.B.3. of the proposed rule for more details on this estimated burden calculation. When we first adopted the COVID–19 Vaccination Coverage Among HCP measure, the United States was in a PHE with millions of cases and over 550,000 COVID–19 deaths (86 FR 42633). While preventing the spread of COVID–19 remains a public health goal, the PHE ended on May 11, 2023 he United States was in a PHE with millions of cases and over 550,000 COVID–19 deaths (86 FR 42633). While preventing the spread of COVID–19 remains a public health goal, the PHE ended on May 11, 2023.10 In addition, the number of deaths due to COVID–19 in the U.S. has decreased since the adoption of this measure. In March 2021, when this measure was being proposed, the United States was averaging over 5,000 deaths per week. In April 2023, the last full month of the PHE, weekly number of deaths due to COVID–19 averaged around 1,300.11 With the end of the PHE and the decrease in COVID–19 deaths, we believe the continued costs and burden to providers of tracking and monthly reporting on this measure outweigh the 10 https://www.hhs.gov/coronavirus/covid-19- public-health-emergency/index.html. 11 Provisional COVID–19 Deaths, by Week, in The United States, Reported to CDC. Accessed on March 27, 2025 via https://covid.cdc.gov/covid-data- tracker/#trends_weeklydeaths_select_00. benefit of continued information collection on COVID–19 vaccination coverage among HCP. As it may be costly for IPFs to continue to report on the COVID–19 Vaccination Coverage Among HCP measure, removal of this mea tinued information collection on COVID–19 vaccination coverage among HCP. As it may be costly for IPFs to continue to report on the COVID–19 Vaccination Coverage Among HCP measure, removal of this measure would allow the IPFQR Program to focus on goals such as measuring clinical outcomes. We stated that, if finalized, IPFs that do not report their CY 2024 reporting period data for the COVID–19 HCP Vaccination measure to CMS would not be considered noncompliant with the measures for purposes of their FY 2026 payment determination (that is, IPFs that do not report CY 2024 reporting period data would not be penalized for FY 2026 payments due to this measure). Any COVID–19 HCP Vaccination measure data received by CMS would not be used for public reporting or payment purposes. We also stated that, if not finalized, IPFs that do not report their CY 2024 reporting data for the COVID–19 HCP Vaccination measure to CMS would be considered noncompliant with the measure for their FY 2026 payment determination, and would receive a letter of noncompliance after August 1, at which time the required 30 day reconsideration period would begin. Payment adjustments would apply to FY 2026 payment deter etermination, and would receive a letter of noncompliance after August 1, at which time the required 30 day reconsideration period would begin. Payment adjustments would apply to FY 2026 payment determination as previously finalized. We invited public comment on our proposal to remove the COVID–19 Vaccination Coverage Among HCP measure from the IPFQR Program beginning with the FY 2026 payment determination. The following is a summary of the comments we received and our responses. Comment: Many commenters supported the removal of this measure. Commenters stated that tracking and reporting for this measure is burdensome, especially given the changes in measure definition over time. A few commenters described the administrative challenges with the up- to-date definition used in this measure, which has changed over time. These commenters stated that the current definition made data collection difficult. A few commenters stated that the measure no longer reflects facility performance or quality of care. A few commenters stated that removal of this measure will allow their staff to spend more time on activities or areas that more directly contribute to improved care for patients or for s lity of care. A few commenters stated that removal of this measure will allow their staff to spend more time on activities or areas that more directly contribute to improved care for patients or for safety and protection of the IPF workforce. A few commenters noted practical concerns around continuing to require this measure, such as the vaccination no VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00031 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 37658 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations longer being required for HCP at their facility. Response: We thank commenters for their support. Comment: A commenter stated that this measure’s definition, data collection, and public reporting represent a point-in-time count of a numerator, and do not accurately depict vaccination coverage. This commenter supported the removal of this measure. Response: We thank the commenter for their support. Comment: A commenter opposed the removal of this measure, stating that this measure is important to sustaining infection control practices and protecting IPF patients. Response nter for their support. Comment: A commenter opposed the removal of this measure, stating that this measure is important to sustaining infection control practices and protecting IPF patients. Response: We acknowledge that vaccination of healthcare personnel against COVID–19 may be one component of infection control in IPFs, but we do not believe that the removal of this measure of vaccination rates will inhibit IPFs’ abilities to protect IPF patients, as well as IPF healthcare personnel. We remind readers the COVID–19 Vaccination Coverage Among HCP measure was never a vaccine mandate (86 FR 42638; 88 FR 51133), and we note that IPFs may continue to encourage and monitor HCP vaccination against COVID–19 and/or other infectious diseases as part of their policies to meet the infection control conditions of participation at 42 CFR 482.42. The goal of this measure removal is to alleviate the burden associated with tracking and reporting COVID–19 HCP vaccination rates for the IPFQR Program. Final Decision: After consideration of the comments we received, we are finalizing our proposal to remove the COVID–19 Vaccination Coverage Among HCP measure as proposed. E. Removal of two Social Driv Final Decision: After consideration of the comments we received, we are finalizing our proposal to remove the COVID–19 Vaccination Coverage Among HCP measure as proposed. E. Removal of two Social Drivers of Health Measures Beginning With the CY 2024 Voluntary Reporting Period We proposed to remove two social drivers of health process measures from the IPFQR Program beginning with the CY 2024 voluntary reporting period: Screening for Social Drivers of Health measure (Screening for SDOH) (adopted at 88 FR 51107 through 51117); and Screen Positive Rate for Social Drivers of Health measure (Screen Positive) (adopted at 88 FR 51117 through 51121) in the FY 2026 IPF PPS proposed rule (90 FR 18517). In the proposed rule, we proposed to remove the Screening for SDOH and Screen Positive measures beginning with the CY 2024 voluntary reporting period under removal Factor 8, the costs associated with the measure outweigh the benefit of its continued use in the program (90 FR 18517). We have previously heard from some IPFs concerned with the costs and resources associated with screening patients via manual processes, manually storing such data, training staff, and altering workflows for these m usly heard from some IPFs concerned with the costs and resources associated with screening patients via manual processes, manually storing such data, training staff, and altering workflows for these measures. In the FY 2024 IPF PPS final rule, we estimated a total annual burden of surveying IPF patients for health-related social needs under the Screening for Social Drivers of Health measures will be 66,414 hours (1,596 facilities × 1,261 patients per facility × 0.033 hr) at a cost of $1,375,434 (66,414 hour × $20.71/hour) across all patients (88 FR 51152). We estimated that the submission of the Screen Positive measure to CMS would have incurred an additional 266 hours across all IPFs, at a cost of $11,933 (88 FR 51152 through 51153). We note that, as stated in section V.B.3. and shown in Tables 8 through 10 of the proposed rule, removal of the Screening for SDOH measure would alleviate an estimated annual burden for patients of 66,414 hours, at a cost of $1,702,191 (90 FR 18525). Also, as stated in section V.B.3. of the proposed rule, removal of both SDOH measures would alleviate an estimated of 532 hours for IPFs to report these measures, at a cost of $29,520, for the FY 2027 pay , as stated in section V.B.3. of the proposed rule, removal of both SDOH measures would alleviate an estimated of 532 hours for IPFs to report these measures, at a cost of $29,520, for the FY 2027 payment determination, when these measures would become mandatory (90 FR 18525). Further, we noted that these measures document an administrative process and report aggregate level outcomes, and do not measure the extent to which providers are ultimately connecting patients with resources or services and whether patients are benefiting from these screenings. We stated that the costs of the use of these measures in the IPFQR Program outweigh the benefits to providers and patients. Removal of these measures would alleviate the burden on IPFs to manually screen each patient and submit data each reporting cycle, allowing IPFs to focus resources on measurable clinical outcomes. This would also remove the patient burden associated with repeated SDOH screenings across multiple healthcare facilities. We referred readers to our request for comment ‘‘Request for Information on Future Measures for the IPFQR Program’’ in section IV.H.2. of the proposed rule for more information regarding our areas of We referred readers to our request for comment ‘‘Request for Information on Future Measures for the IPFQR Program’’ in section IV.H.2. of the proposed rule for more information regarding our areas of focus for new measures (90 FR 18520). We acknowledged that some IPFs may have expended resources to implement SDOH screenings, however, IPFs that had already implemented such screenings prior to adoption of the measures would not have expended similar resources in response to the measure. The objectives of the IPFQR Program continue to incentivize the improvement of care quality and health outcomes for all patients through transparency and use of appropriate quality measures. In the proposed rule, we described scenarios for reporting or non-reporting of these data for the FY 2026 payment determination (90 FR 18517). We wish to clarify that the SDOH measures were adopted as voluntary in the IPFQR Program for the FY 2026 payment determination, and not mandatory until beginning with the FY 2027 payment determination (88 FR 51113 and 88 FR 51119 through 511120). We additionally refer readers to a comment response later in this section V.B.F. We invited public comment on our proposal to re 027 payment determination (88 FR 51113 and 88 FR 51119 through 511120). We additionally refer readers to a comment response later in this section V.B.F. We invited public comment on our proposal to remove these SDOH measures from the IPFQR Program beginning with the CY 2024 reporting period. The following is a summary of the comments we received and our responses. Comment: Many commenters were supportive of these measure removals, citing high burden for patient screening, data storage, and reporting. Several commenters noted that this burden was highest for IPFs without robust electronic health records (EHRs), which had to track these data manually. Several commenters affirmed the importance of SDOH and screening for social needs in the IPF, but were nevertheless supportive of the removal because of what they perceived to be limitations of these measures beyond the rationale offered by CMS (for example, timing of data collection, appropriateness of screening in this format for the IPF setting). Response: We thank the commenters for their support. Comment: Some commenters expressed concerns about frequent changes to measures in the IPFQR Program such as the proposed removal of the S setting). Response: We thank the commenters for their support. Comment: Some commenters expressed concerns about frequent changes to measures in the IPFQR Program such as the proposed removal of the SDOH measures shortly after their adoption. They cautioned that there are practical consequences for IPFs and that these changes could damage trust in the IPFQR Program. Response: We strive to maintain a parsimonious set of measures in the IPFQR Program that are reliable and meaningful to patients and IPFs. Ongoing review and evaluation of measures will result in measures being modified, added, or removed over time. We acknowledge that these changes impact IPFs and strive to provide clear guidance and adequate notice for measure changes to the greatest extent feasible. Comment: Many commenters were opposed to the removal of the SDOH VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00032 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 37659 measures. Many commenters described how SDOH significantly impacts health outcomes and the t n o r e t t o l Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations 37659 measures. Many commenters described how SDOH significantly impacts health outcomes and the types of care and services patients may require in the IPF. These commenters stated that screening for SDOH is fundamental to patient- centered care, including clinical outcomes, treatment adherence, and reducing preventable healthcare utilization (for example, emergency department visits and readmissions). Several commenters stated that there is evidence from research and federal models demonstrating that SDOH screening improves health outcomes, reduces healthcare costs, and decreases avoidable utilization. For example, a commenter cited findings from CMS’ Accountable Health Communities Model which found decreased heath care expenditures, inpatient stays, and emergency department visits for model participants. Another commenter stated that they believe there is evidence that unmet social needs can lead to missed follow-up appointments, delayed care, and poor chronic disease management. Some commenters stated that removing these measures would disregard the proven value of SDOH interven eeds can lead to missed follow-up appointments, delayed care, and poor chronic disease management. Some commenters stated that removing these measures would disregard the proven value of SDOH interventions. Response: We appreciate the commenters’ commitment to supporting optimal outcomes for their patients, and we recognize the importance of social factors for individuals as they seek to maintain good health or recover from illness. We reiterate that the goal of the removal of these measures is to reduce administrative burden for IPFs and patients. We recognize that there are many clinical practices employed by facilities that have been shown to produce positive outcomes for patients, and the removal of these measures does not preclude those practices from continuing. As we strive to maintain a parsimonious set of measures in the IPFQR Program, we must balance the need for data collection with the costs that such data collections may have on IPFs and their patients. By streamlining the number of measures required for reporting, we believe IPFs will be able to better focus efforts and resources to address the quality issues that matter most to their patients. Comment: Some commenter number of measures required for reporting, we believe IPFs will be able to better focus efforts and resources to address the quality issues that matter most to their patients. Comment: Some commenters disagreed that the cost of the SDOH measures outweighed the benefit, given cost savings through patients’ decreased utilization of avoidable emergency department visits and hospitalizations that commenters stated can result through addressing social factors. Response: Our proposal to remove these measures from the IPFQR Program was based on our assessment of the burden of data collection and reporting, and our conclusion that, at this time, the benefits of retaining these measures in the IPFQR Program are outweighed by the burden to providers. We acknowledge commenters’ concerns and encourage IPFs to continue to close identified gaps in patient care including avoidable ED visits and hospitalizations. We urge IPFs to continue to incorporate industry standards that may address challenges that could impact safe high- quality healthcare delivery. Despite removal of these measures from the IPFQR Program, IPFs will still be able to collect data that is important to their patient care initi hat could impact safe high- quality healthcare delivery. Despite removal of these measures from the IPFQR Program, IPFs will still be able to collect data that is important to their patient care initiatives and reflects the unique needs of their specific patient population. Comment: A commenter stated that the substantial costs to IPFs have already been incurred as they have set up systems to collect these data, claiming that removing the measures now will have minor impacts on cost. Response: We acknowledge that some IPFs may have aligned resources to prepare for or to begin implementing SDOH screenings, such as selecting standardized screening questions, updating EHRs, and modifying clinician workflow. However, we believe that removal of these measures at this time will reduce greater levels of burden in the future—specifically, the burden incurred by patients and providers for screening, data storage, and data reporting, annually, going forward. Comment: Many commenters stated that removing SDOH measures would undermine efforts to reduce health disparities and improve quality of care for all patients. Some commenters expressed concern that removing SDOH measures would shift the removing SDOH measures would undermine efforts to reduce health disparities and improve quality of care for all patients. Some commenters expressed concern that removing SDOH measures would shift the focus of quality reporting too narrowly toward clinical outcomes, neglecting the broader context of whole-person care and well-being. Several commenters stated that addressing social needs, such as food insecurity and housing instability, is integral to comprehensive care delivery, and long-term recovery, particularly in psychiatric settings. Several commenters stated these measures are a crucial component in promoting nutrition and well-being, areas that CMS has stated an interest in for future measure concepts. Response: We acknowledge commenters’ concerns that the removal of these measures will compromise the ability of the IPFQR Program to support and improve quality of care for all patients, and that removing these measures creates a risk that quality reporting will become too narrowly focused on clinical outcomes. Although we stated we are re-focusing on clinical outcomes in our proposal to remove these measures, we clarify that whole- person care is a priority for CMS, as well a y focused on clinical outcomes. Although we stated we are re-focusing on clinical outcomes in our proposal to remove these measures, we clarify that whole- person care is a priority for CMS, as well as measures that are meaningful to patients. The objectives of the IPFQR Program continue to be the improvement of care, quality, and health outcomes for all patients through transparency and quality measurement, while balancing burden on essential health providers. We note that we regularly review and evaluate IPFQR Program measures to ensure a parsimonious set of the most meaningful quality measures for the IPFQR Program. We understand that some commenters believe that addressing social needs may be required for optimal care delivery for some patients. Our proposal to remove these measures from the IPFQR Program was based on our assessment of the burden of data collection and reporting, and our conclusion that, at this time, the benefits of retaining these measures in the IPFQR Program are outweighed by the costs and burden to providers. As discussed earlier, we expect providers to exercise their best judgement around factors to account for in their clinical decision-making. Some comm e outweighed by the costs and burden to providers. As discussed earlier, we expect providers to exercise their best judgement around factors to account for in their clinical decision-making. Some commenters linked these measures to concepts of well-being and nutrition. We note that topical overlap does not resolve the issue of patient and provider burden for manual screening, data storage, and data reporting of these measures. Comment: Several commenters proposed revising or streamlining the SDOH measures rather than removing them entirely. Suggestions included introducing measures that assess connections to community resources, automating reporting through EHRs, allowing sampling methods, using trainees to conduct screenings, incentivizing IPFs for integrating SDOH into their care, and aligning SDOH measures with existing workflows to reduce burden. Response: We appreciate commenters’ suggestions for various modifications to the measures, and ideas for how to reduce burden associated with screening and data collection. In particular, we appreciate the commenters’ suggestion to utilize an EHR data collection framework. We refer readers to section V.H.2. of this final rule for a sum with screening and data collection. In particular, we appreciate the commenters’ suggestion to utilize an EHR data collection framework. We refer readers to section V.H.2. of this final rule for a summary of a request for information on our digital quality measurement strategy and approach to using FHIR® reporting in the IPFQR Program. The burden of including these for patient assessment measures, in their current state, in the IPFQR Program outweighs the benefits the measure data provides to patients and facilities. Commenters suggested ways to make the screening and VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00033 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 37660 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations reporting process less burdensome for patients and facilities, and offered ideas for how the data collected by these measures provided more informative or actionable information about patient needs or patient care. However, the changes they suggest to meaningfully reduce burden (that is, automated reporting through EHR integration) would require substanti tionable information about patient needs or patient care. However, the changes they suggest to meaningfully reduce burden (that is, automated reporting through EHR integration) would require substantial changes to both the measures (for example, standardization of the screening questions) and to the reporting requirement and technological infrastructure of IPFs. We will consider these comments as we continue to develop policies for future rulemaking. Comment: Several commenters noted that the proposed rule stated if CMS does not finalize the proposal to remove the SDOH measures, that IPFs that do not report their CY 2024 reporting data for the SDOH measures to CMS would be considered noncompliant with the measures for their FY 2026 payment determination, but pointed out that the SDOH measures are voluntary in the IPFQR Program for the CY 2024 reporting period/FY 2026 payment determination. Response: The commenters are correct. To clarify, the SDOH measures are voluntary for the IPFQR Program for the FY 2026 payment determination. Even if we were not finalizing our proposal to remove these measures, IPFs could choose not to submit data on these measures for the voluntary CY 2024 rep rogram for the FY 2026 payment determination. Even if we were not finalizing our proposal to remove these measures, IPFs could choose not to submit data on these measures for the voluntary CY 2024 reporting period and still be compliant with IPFQR Program requirements for the FY 2026 payment determination. Comment: Two commenters stated concerns about the timing of the measure removals. A commenter requested that these measures not be removed from the IPFQR Program until the CY 2026 reporting period/FY 2028 payment determination, as IPFs are currently collecting these data (that is, CY 2025 reporting period data for FY 2027 payment determination). Another commenter stated that the proposed measure removals should have been addressed in prior rulemaking, as the current implementation timeline is challenging for health IT vendors to support. They noted that IT vendors are currently engaged in development for an October 1, 2025, implementation of the mandatory reporting period, but note that these proposals may render those investments obsolete. They encouraged CMS to better align measure removal timelines with operational considerations, such as development of health IT. Response: We hat these proposals may render those investments obsolete. They encouraged CMS to better align measure removal timelines with operational considerations, such as development of health IT. Response: We acknowledge the impacts of this implementation timeline. The measures are being removed on the proposed timeline to alleviate the burden on patients and providers as soon as possible. Removal on a delayed timeline would mean requiring IPFs to collect and report measures whose benefit has been determined to be outweighed by the cost and burden of implementation and collection. Final Decision: After consideration of the comments we received, we are finalizing our proposal to remove the Screening for SDOH and Screen Positive measures as proposed. F. Summary of IPFQR Program Measures 1. IPFQR Program Measures for the FY 2028 Payment Determination In this final rule, we are modifying the reporting period of one measure (the IPF ED Visit Measure) and removing four measures (the Facility Commitment to Health Equity measure, the COVID– 19 Vaccination Coverage Among Healthcare Personnel (HCP) Measure, the Screening for Social Drivers of Health measure, and the Screen Positive Rate for Social D ent to Health Equity measure, the COVID– 19 Vaccination Coverage Among Healthcare Personnel (HCP) Measure, the Screening for Social Drivers of Health measure, and the Screen Positive Rate for Social Drivers of Health measure). We did not propose any new measures for the IPFQR Program in the FY 2026 IPF PPS proposed rule. Table 5 sets forth the finalized measures for the IPFQR Program for the FY 2028 payment determination. TABLE 5—IPFQR PROGRAM MEASURE SET FOR THE FY 2028 PAYMENT DETERMINATION Consensus-based entity (CBE) # Measure ID Measure 0640 .......................... HBIPS–2 ...................................... Hours of Physical Restraint Use. 0641 .......................... HBIPS–3 ...................................... Hours of Seclusion Use. N/A ............................ FAPH ............................................ Follow-Up After Psychiatric Hospitalization. N/A * .......................... SUB–2 and SUB–2a .................... Alcohol Use Brief Intervention Provided or Offered and SUB–2a Alcohol Use Brief Intervention. N/A * .......................... SUB–3 and SUB–3a .................... Alcohol and Other Drug Use Disorder Treatment Provided or Offered at Disc d or Offered and SUB–2a Alcohol Use Brief Intervention. N/A * .......................... SUB–3 and SUB–3a .................... Alcohol and Other Drug Use Disorder Treatment Provided or Offered at Discharge N/A * .......................... TOB–3 and TOB–3a .................... Tobacco Use Treatment Provided or Offered at Discharge and TOB–3a Tobacco and SUB–3a Alcohol and Other Drug Use Disorder Treatment at Discharge. Use Treatment at Discharge. 1659 .......................... N/A * .......................... TR–1 ............................................ Transition Record with Specified Elements Received by Discharged Patients (Dis- IMM–2 .......................................... Influenza Immunization. N/A ............................ SMD ............................................. Screening for Metabolic Disorders. N/A ............................ PIX ............................................... Psychiatric Inpatient Experience Survey. 2860 .......................... IPF Unplanned Readmission ....... Thirty Day All-Cause Unplanned Readmission Following Psychiatric Hospitalization charges from an Inpatient Facility to Home/Self Care or Any Other Site of Care). N/A * .... planned Readmission ....... Thirty Day All-Cause Unplanned Readmission Following Psychiatric Hospitalization charges from an Inpatient Facility to Home/Self Care or Any Other Site of Care). N/A * .......................... Med Cont ..................................... Medication Continuation Following Inpatient Psychiatric Discharge. in an Inpatient Psychiatric Facility. * Measure is no longer endorsed by the CBE but was endorsed at the time of adoption. We note that although section 1886(s)(4)(D)(i) of the Act generally requires measures specified by the Secretary be endorsed by the entity with a contract under section be endorsed by the entity with a contract under section 1890(a) of the Act, section 1886(s)(4)(D)(ii) of the Act states that in the case of a specified area or medical topic determined appropriate by the Secretary for which a feasible and practical measure has not been endorsed by the entity with a contract under section 1890(a) of the Act, the Secretary may specify a measure that is not so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus organization identified by the Secretary. We attempted to find avail measure that is not so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus organization identified by the Secretary. We attempted to find available measures for each of these clinical topics that have been endorsed or adopted by a consensus organization and found no other feasible and practical measures on the topics for the IPF setting. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00034 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 37661 2. IPFQR Program Measures for the Table 6 sets forth the finalized FY 2029 Payment Determination measures for the IPFQR Program for the FY 2029 IPFQR payment determination. TABLE 6—IPFQR PROGRAM MEASURE SET FOR THE FY 2029 PAYMENT DETERMINATION Consensus-based entity (CBE) # Measure ID Measure 0640 .......................... HBIPS–2 ...................................... Hours of Physical Restraint Use. 0641 .......................... HBIPS–3 ...................................... Hours of Seclusion Use. N/A ..................... ...................................... Hours of Physical Restraint Use. 0641 .......................... HBIPS–3 ...................................... Hours of Seclusion Use. N/A ............................ FAPH ............................................ Follow-Up After Psychiatric Hospitalization. N/A * .......................... SUB–2 and SUB–2a .................... Alcohol Use Brief Intervention Provided or Offered and SUB–2a Alcohol Use Brief Intervention. N/A * .......................... SUB–3 and SUB–3a .................... Alcohol and Other Drug Use Disorder Treatment Provided or Offered at Discharge N/A * .......................... TOB–3 and TOB–3a .................... Tobacco Use Treatment Provided or Offered at Discharge and TOB–3a Tobacco and SUB–3a Alcohol and Other Drug Use Disorder Treatment at Discharge. Use Treatment at Discharge. 1659 .......................... N/A * .......................... TR–1 ............................................ Transition Record with Specified Elements Received by Discharged Patients (Dis- IMM–2 .......................................... Influenza Immunization. N/A ............................ SMD ................................. Specified Elements Received by Discharged Patients (Dis- IMM–2 .......................................... Influenza Immunization. N/A ............................ SMD ............................................. Screening for Metabolic Disorders. N/A ............................ PIX ............................................... Psychiatric Inpatient Experience Survey. 2860 .......................... IPF Unplanned Readmission ....... Thirty Day All-Cause Unplanned Readmission Following Psychiatric Hospitalization charges from an Inpatient Facility to Home/Self Care or Any Other Site of Care). N/A ............................ IPF ED Visit ................................. 30-Day Risk-Standardized All-Cause Emergency Department Visit Following an In- N/A * .......................... Med Cont patient Psychiatric Facility Discharge. ..................................... Medication Continuation Following Inpatient Psychiatric Discharge. in an Inpatient Psychiatric Facility. * Measure is no longer endorsed by the CBE but was endorsed at the time of adoption. We note that although section 1886(s)(4)(D)(i) of the Act generally requires measures specified by the Secretary be endorsed by t o longer endorsed by the CBE but was endorsed at the time of adoption. We note that although section 1886(s)(4)(D)(i) of the Act generally requires measures specified by the Secretary be endorsed by the entity with a contract under section be endorsed by the entity with a contract under section 1890(a) of the Act, section 1886(s)(4)(D)(ii) of the Act states that in the case of a specified area or medical topic determined appropriate by the Secretary for which a feasible and practical measure has not been endorsed by the entity with a contract under section 1890(a) of the Act, the Secretary may specify a measure that is not so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus organization identified by the Secretary. We attempted to find available measures for each of these clinical topics that have been endorsed or adopted by a consensus organization and found no other feasible and practical measures on the topics for the IPF setting. G. IPFQR Program Extraordinary Circumstances Exception (ECE) Policy 1. Background Under the current Extraordinary Circumstances Exception (ECE) policy as set forth in our regulations at 412.43 etting. G. IPFQR Program Extraordinary Circumstances Exception (ECE) Policy 1. Background Under the current Extraordinary Circumstances Exception (ECE) policy as set forth in our regulations at 412.433(f), we have granted exceptions with respect to quality data reporting requirements in the event of extraordinary circumstances beyond the control of an IPF. An exception may be granted for extraordinary circumstances including, but not limited to, natural disasters or systemic problems with data collection systems. In the FY 2026 IPF PPS proposed rule, we referred readers to 412.433(f) for our current ECE regulations, as well as the FY 2013 IPPS/LTCH PPS final rule (77 FR 53659 through 53660), FY 2014 IPPS/LTCH PPS final rule (78 FR 50903), FY 2015 IPF PPS final rule (79 FR 45978), and FY 2018 IPPS/LTCH PPS final rule (82 FR 38473 through 38474) for further background and details of the ECE policy (90 FR 18518 through 18519). We also referred readers to the CMS QualityNet website for the specific requirements for submission of an ECE request in the IPFQR Program.12 12 https://qualitynet.cms.gov/ipf/ipfqr/ participation. Our ECE policy provides flexibility for IPFQR Program participan specific requirements for submission of an ECE request in the IPFQR Program.12 12 https://qualitynet.cms.gov/ipf/ipfqr/ participation. Our ECE policy provides flexibility for IPFQR Program participants to ensure continuity of quality care delivery and measure reporting in the event of an extraordinary circumstance. For instance, we recognized that, in circumstances where a full exception is not applicable, it is beneficial for an IPF to report data later than the reporting deadline. Delayed reporting authorized under our ECE policy allows temporary relief for an IPF experiencing an extraordinary circumstance while preserving the benefits of data reporting, such as transparency and informed decision-making for beneficiaries and providers alike. Accordingly, we proposed to update our regulations to specify that an ECE could take the form of an extension of time for an IPF to comply with a data reporting requirement if CMS determines that this type of relief would be appropriate under the circumstances. 2. Update of the Extraordinary Circumstances Exception (ECE) Policy for the IPFQR Program As discussed in the FY 2026 IPF PPS proposed rule, we proposed to update the current ECE poli e circumstances. 2. Update of the Extraordinary Circumstances Exception (ECE) Policy for the IPFQR Program As discussed in the FY 2026 IPF PPS proposed rule, we proposed to update the current ECE policy codified at 42 CFR 412.433(f) to include extensions of time as a form of relief and to further clarify the policy (90 FR 18518 through 18519). Specifically, in the introductory text at proposed 42 CFR 412.433(f)(1), we proposed that CMS may grant an ECE with respect to reporting requirements in the event of an extraordinary circumstance—defined as 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 hospital to comply with one or more applicable reporting requirements with respect to a fiscal year. We proposed that the steps required for requesting or granting an ECE would remain the same as the current ECE process, detailed by CMS at the QualityNet website or a successor website.13 At proposed 42 CFR 412.433(f)(2)(i), we proposed that an IPF may request an ECE within 30 calendar days of the date that the extraordinary circumstance occurred. Our curre te or a successor website.13 At proposed 42 CFR 412.433(f)(2)(i), we proposed that an IPF may request an ECE within 30 calendar days of the date that the extraordinary circumstance occurred. Our current policy allows a request within 90 days; however, the proposed change would align the IPFQR Program policy with CMS systems implementation requirements across all quality reporting programs. Under the proposed codified policy, we clarified that CMS retains the 13 https://qualitynet.cms.gov/inpatient/iqr/ participation#tab3. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00035 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 37662 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations authority to grant an ECE as a form of relief at any time after the extraordinary circumstance has occurred. At proposed 42 CFR 412.433(f)(2)(ii), we proposed that CMS notify the requestor with a decision 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 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. Additionally, at 42 CFR 412.433(f)(3), we proposed that CMS may grant an ECE to one or more IPFs that have not requested an ECE if CMS determines that: 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 that an extraordinary circumstance has affected an entire region or locale. As is the case under our current policy, any ECE granted will specify whether the affected IPFs are exempted from one or more reporting requirements or whether CMS has granted the IPFs an extension of time to comply with one or more reporting requirements. The proposed ECE policy would provide further reporting flexibility for IPFs and clarify the ECE process. We invited public comments on our proposals to update the ECE policy for the IPFQR Program. Comment: Several commenters were supportive of CMS’s proposal to modify the ECE policy rify the ECE process. We invited public comments on our proposals to update the ECE policy for the IPFQR Program. Comment: Several commenters were supportive of CMS’s proposal to modify the ECE policy to explicitly include reporting extensions as a form of exception. Response: We thank commenters for their support. Comment: A commenter stated a concern that CMS could effectively replace reporting exceptions with reporting extensions, and that this might not be appropriate for many providers experiencing extraordinary circumstances. The commenter recommended that CMS use extensions sparingly. Response: We thank the commenters for their recommendations. We will continue to consider ECE applications on a case-by-case basis and offer any exception or extension based on the nature of the extraordinary circumstance and the capacity of the provider, as well as CMS operational feasibility to grant an exception versus an extension. We note our preference to grant an extension when it can be feasibly granted because of the importance of having quality measure data particularly for public reporting purposes, as transparency is a paramount goal of the program. Comment: A commenter recommended sibly granted because of the importance of having quality measure data particularly for public reporting purposes, as transparency is a paramount goal of the program. Comment: A commenter recommended that CMS ensure that the ECE application process is clear, imposes minimal administrative burden, and that CMS provides technical assistance for IPF navigating the ECE process. Response: To extent applicable, we strive to ensure the ECE application process is aligned across multiple hospital quality reporting programs to minimize administrative burden and promote process clarity, such as by using a single form. In addition, ECE-related education and outreach materials, as well as copies of the form, are available on QualityNet.14 We also have the IPFQR Program Help Desk 15 to answer questions from facilities if facilities require assistance. Comment: A few commenters opposed the update to the timeframe for IPFs to submit an ECE request from 90 days to 30 days. These commenters described 30 days as being inadequate and impractical. A commenter recommended that CMS retain the current policy of 90 days, citing increasing frequency of extreme weather events as well as cyberattacks. A comme days as being inadequate and impractical. A commenter recommended that CMS retain the current policy of 90 days, citing increasing frequency of extreme weather events as well as cyberattacks. A commenter referred to the experience of hospitals in Virginia and North Carolina that experienced severe flooding in 2024, stating that facilities that experience an extraordinary circumstance could reasonably still be restoring operations and focusing on patient care 30 days after the emergency. This commenter expressed concern that moving to a 30-day window could lead to situations where hospitals miss the ECE request deadline because they are still dealing with the emergency. This commenter stated that if CMS believes a shorter timeframe is needed, a 60-day request window would be preferrable to the 30-day window in the proposal. This commenter also recommended that CMS consider late ECE applications on a case-by-case basis. Response: We appreciate the commenters’ responses. We recognize that IPFs may not have the ability to assess the impact on quality data submissions and complete the necessary paperwork within 30 days of the extraordinary circumstance. Due to concerns regarding IPFs’ t IPFs may not have the ability to assess the impact on quality data submissions and complete the necessary paperwork within 30 days of the extraordinary circumstance. Due to concerns regarding IPFs’ ability to complete the ECE request within 30 days of the extraordinary circumstance, we are modifying the timeframe to allow 14 https://qualitynet.cms.gov/ipf/ipfqr/ participation#tab3. 15 The IPFQR Program Help Desk can be accessed through the Quality Question and Answer Tool at https://cmsqualitysupport.servicenowservices.com/ qnet_qa. for 60 days to submit an ECE request. We believe this timeframe will provide sufficient time for IPFs to assess the impact on quality reporting without disrupting operational and care needs. Therefore, we are finalizing a modified policy that states that IPF may request an ECE within 60 calendar days of the date that the extraordinary circumstance occurred. Comment: A commenter recommended that CMS include additional details on how the determination of an exception versus an extension will be made, stating that transparency will help facilities prepare for the outcome of the process (that is, whether they are likely to receive an extension or an excep exception versus an extension will be made, stating that transparency will help facilities prepare for the outcome of the process (that is, whether they are likely to receive an extension or an exception). Response: We consider ECE applications on a case-by-case basis and make the decision to offer relief based on the nature of the extraordinary circumstance and the capacity of the provider, as well as CMS operational feasibility to grant an exception or an extension. IPFs applying for an ECE are encouraged to share relevant details that would inform our decision on whether to grant an exception or an extension, which we will take into account when reviewing the application. As noted, we generally will prefer to grant an extension when it can be feasibly granted because of the importance of having quality measure data particularly for public reporting purposes. Final Decision: After consideration of the comments we received, we are finalizing our proposal to update and codify updates to the ECE policy with modification. After consideration of concerns identified in public comments regarding the proposed 30 calendar day timeframe during which an IPF may request an ECE, and for the to the ECE policy with modification. After consideration of concerns identified in public comments regarding the proposed 30 calendar day timeframe during which an IPF may request an ECE, and for the reasons described above, we are finalizing a different timeframe in which an ECE can be requested. We will allow up to 60 calendar days for ECE requests after the precipitating event. We are codifying this updated ECE policy at § 412.434(f) with modification to reflect this extended deadline. H. Requests for Information on Future Changes to the IPFQR Program We solicited public comment on the three following topics that may have future impacts on the IPFQR Program. 1. Request for Information on Future Star Ratings for IPFs Section 1886(s)(4)(F) of the Act requires that the Secretary establish procedures for making data submitted under the IPFQR Program available to the public. Such procedures must ensure the IPFs participating in the VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00036 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 Regula Frm 00036 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 37663 IPFQR Program have the opportunity to review the data prior to such data being made public. The Secretary must publicly report quality measures that relate to services furnished in IPFs on the CMS website. Currently, we publicly report data on measures under the IPFQR Program on the Compare tool on Medicare.gov.16 Star ratings summarize facility or provider performance using symbols to help patients and caregivers quickly and easily understand quality of care information. Star ratings serve an important function for patients, caregivers, and families, helping them to more quickly comprehend complex information about a healthcare providers’ care quality and to easily assess differences among providers. Star ratings also spotlight differences in healthcare quality and identify areas for improvement and may motivate providers to perform well on measures in CMS quality reporting programs. This transparency serves an important educational function for consumers, while also helpi eas for improvement and may motivate providers to perform well on measures in CMS quality reporting programs. This transparency serves an important educational function for consumers, while also helping to promote competition in health care markets. Informed patients and consumers are more empowered to select among healthcare providers, fostering continued quality improvement. The Compare tool currently displays star ratings for many provider types, including doctors and clinicians, some types of hospitals not including inpatient psychiatric hospitals, nursing homes, home health, hospice, and dialysis facilities. The method to calculate star ratings differs by provider type. Differences include data sources, which measures are included, and how the components of the star ratings are combined. Some providers receive ‘‘patient survey’’ star ratings, a composite score derived from patient experience of care surveys, in addition to ‘‘overall star ratings,’’ which are a composite score calculated using different data sources, such as quality measures or survey results. Although we publicly report data on measures under the IPFQR Program on the Compare tool, there are currently no star r ulated using different data sources, such as quality measures or survey results. Although we publicly report data on measures under the IPFQR Program on the Compare tool, there are currently no star ratings displayed for IPFs, and IPFs are not included in hospital star ratings. We sought feedback on the development of a five-star methodology for IPFs that can meaningfully describe the quality of care offered by IPFs. Star ratings for IPFs would be designed to help consumers quickly identify differences in quality when selecting an IPF. We are committed to developing a well-tested, data-driven methodology that encourages continuous quality 16 https://www.medicare.gov/care-compare. improvement. We plan to engage with the IPF community and provide multiple opportunities for IPFs and other interested parties to give input on the development of a star rating system for IPFs. We noted that IPFs would have the ability to preview their own facility’s quality data before public posting of the IPF’s star rating on the Compare tool in accordance with section 1886(s)(4)(F) of the Act.17 Specifically, in the FY 2026 IPF PPS proposed rule, we invited public comments on the following topics (90 F PF’s star rating on the Compare tool in accordance with section 1886(s)(4)(F) of the Act.17 Specifically, in the FY 2026 IPF PPS proposed rule, we invited public comments on the following topics (90 FR 18519 through 18520). Criteria for Measure Selection 1. Are there specific criteria CMS should use to select measures for an IPF star rating system, such as a measure’s generalizability (degree to which a measure is applicable to a broad segment of patients)? 2. Should an IPF star rating system be limited to or more heavily weight certain types of measures (for example, outcome measures, process measures, structural measures; measures that address certain topics, such as safety, psychiatric treatment, substance use treatment, whole-person care, or patient experience)? Suitability of Measures Currently in the IPFQR Program 3. From the perspective of patients and families or other caregivers, which measures currently adopted for the IPFQR Program are most important when attempting to summarize quality of care in IPFs? Which are least important? Are there any measures in the program that should be specifically excluded or included in IPF Star Ratings? For the list of IPFQR Program measu rize quality of care in IPFs? Which are least important? Are there any measures in the program that should be specifically excluded or included in IPF Star Ratings? For the list of IPFQR Program measures, we referred the reader to Table 6 in section IV.F. in the proposed rule. 4. From the perspective of referring providers, payers, or other interested parties, which measures currently adopted for the IPFQR Program are most important when attempting to summarize quality of care in IPFs? Which are least important? Are there any measures in the program that should be specifically excluded or included in an IPF star ratings system? 5. Two measures currently in the IPFQR Program—Hours of Physical Restraint Use (HBIPS–2) and Hours of Seclusion Use (HBIPS–3)are calculated and publicly reported as a rate per 1000 hours of patient care. Does the way these measures are currently specified and displayed create challenges for including these measures in a star rating calculation? If these measures were selected to be included in a star rating calculation, are there recommendations about how these measures should be included in a larger star rating methodology? For example, should the rate be m were selected to be included in a star rating calculation, are there recommendations about how these measures should be included in a larger star rating methodology? For example, should the rate be made into a categorical variable (for example, quartiles)? Future Use of Additional Data for an IPF Star Rating System 6. In the FY 2024 IPF PPS final rule (88 FR 51128), we finalized the Psychiatric Inpatient Experience (PIX) survey as a measure of patient experience in IPFs. The PIX survey will become mandatory for the FY 2028 payment determination—that is, data collection occurring in CY 2026. Although PIX data may not be available for an initial version of an IPF star rating system, what considerations should CMS give these data, when they become available? For example, should they be included as part of an overall star rating, or used to derive a stand-alone patient experience star rating? See for example the Hospital patient experience star rating,18 which is derived from the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS©) survey and displayed as ‘‘Patient survey rating’’ on the Compare tool. 7. Are there other measurement topics that are currently not a Consumer Assessment of Healthcare Providers and Systems (HCAHPS©) survey and displayed as ‘‘Patient survey rating’’ on the Compare tool. 7. Are there other measurement topics that are currently not addressed by an IPFQR Program measure, but would be valuable in an IPF star rating? We intend to use this input to inform our future star rating development efforts. We intend to consider how a rating system would determine an IPF’s star rating, the methods used for such calculations, and an anticipated timeline for implementation. We will consider comments in response to this RFI for future rulemaking. The following is a summary of the comments we received and our responses. Comment: Many commenters acknowledged the potential value of a star rating system for IPFs, but some expressed concerns about the uses and usability of star ratings for patients and providers, as well as the readiness of the IPFQR Program to supply sufficient and appropriate data to support star rating development at this time. A few commenters agreed with CMS that star ratings can help consumers make sense of the complex quality measure information available on Care Compare, and could support consumer 17 Currently his time. A few commenters agreed with CMS that star ratings can help consumers make sense of the complex quality measure information available on Care Compare, and could support consumer 17 Currently IPFs preview their data via the ‘‘IPF- specific report (ISR)’’ distributed to providers through CMS’ Hospital Quality Reporting system. 18 https://hcahpsonline.org/en/hcahps-star- ratings/. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00037 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 37664 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations choice in addition to accountability and quality improvement. However, several commenters stated that the existing CMS star rating systems are not widely known or understood by consumers, limiting their effectiveness in helping patients make informed decisions. In addition, some comments noted that patients seeking psychiatric care often do so in crisis situations, where facility choice is constrained by bed availability, geographic limitations, or insurance coverage. They stated concerns that these constraints may limit the usefulness o so in crisis situations, where facility choice is constrained by bed availability, geographic limitations, or insurance coverage. They stated concerns that these constraints may limit the usefulness of star ratings to patients and caregivers. Some commenters cautioned that star ratings can affect IPFs referral and payment patterns, and urged CMS to be cautious in ensuring that ratings did not disadvantage certain providers based on patient case-mix (for example, patients who are involuntarily admitted, patients with high levels of social needs), available of resources in the geographic area, or state-level policies. Many commenters recommended that CMS prioritize certain domain areas for measures included in a star rating system, chiefly aspects of care that they stated are important to most psychiatric patients. These domains included patient safety (including physical assaults, sexual assaults, suicides, unexpected deaths, injuries, and elopements; facility inspection reports, complaints, and regulatory violations), patient experience (including patient dignity and rights, and patient-reported experience of care), and topics and outcomes specific to psychiatric care. In additio laints, and regulatory violations), patient experience (including patient dignity and rights, and patient-reported experience of care), and topics and outcomes specific to psychiatric care. In addition, many commenters recommended evaluation criteria for CMS to use when selecting measures. Criteria included usefulness, scientific quality of the measure (for example, well-defined, accurate, reliable), extent to which the measure included a broad segment of the patient population, reportability (that is, that most IPFs would have sufficient data to report on the measure), and measures that are linked to IPFs’ care processes or patient outcomes. Some commenters also recommended that new measures or measures that have changed specifications be excluded from consideration. Many commenters, after applying their suggested criteria, stated that only two measures currently in the IPFQR Program—HBIPS–2 and HBIPS– 3—are appropriate to include in a rating system. Many commenters emphasized the need for methodological rigor as well as collaboration with experts and interested parties—including people affected by serious mental illness and their families—to ensure that any future star rating sys d for methodological rigor as well as collaboration with experts and interested parties—including people affected by serious mental illness and their families—to ensure that any future star rating system is developed in a way that it is meaningful to patients, reflective of quality of care, and fair to the wide range of IPF providers. Response: We thank commenters for their responses to this comment solicitation. We will consider these comments as we continue to develop policies for future rulemaking. 2. Request for Information on Future Measures for the IPFQR Program In the FY 2026 IPF PPS proposed rule, we sought input on the importance, relevance, appropriateness, and applicability of two concepts under consideration for future years in the IPFQR Program (90 FR 18520). We sought input on a quality measure concept of well-being for future quality measures. Well-being is a comprehensive approach to disease prevention and health promotion, as it integrates mental, social, and physical health 19 20 while emphasizing preventive care to proactively address potential health issues. This comprehensive approach emphasizes person-centered care by promoting well- being of patients and thei health 19 20 while emphasizing preventive care to proactively address potential health issues. This comprehensive approach emphasizes person-centered care by promoting well- being of patients and their family members. We requested input and comment on tools and measures that assess for overall health, happiness, and satisfaction in life that could include aspects of emotional well-being, social connections, purpose, fulfillment, and self-care work. We requested input on the relevant aspects of well-being for the IPF setting. We sought input on a quality measure concept of nutrition for future quality measures. Assessment of an individual’s nutritional status may include various strategies, guidelines, and practices designed to promote healthy eating habits and ensure individuals receive the necessary nutrients for maintaining health, growth, and overall well-being. This also includes aspects of health that support or mediate nutritional status, such as physical activity and sleep. In this context, preventable care plays a vital role by proactively addressing factors that may lead to poor nutritional status or related health issues. These efforts not only support optimal nutrition b his context, preventable care plays a vital role by proactively addressing factors that may lead to poor nutritional status or related health issues. These efforts not only support optimal nutrition but also work to prevent conditions that could otherwise hinder an individual’s health and nutritional needs. We requested input and comment on tools and frameworks that 19 Overall well-being. See more information at https://odphp.health.gov/healthypeople/objectives- and-data/overall-health-and-well-being-measures/ overall-well-being-ohm-01. 20 Well-Being Measurement. See more information at https://www.va.gov/ WHOLEHEALTH/professional-resources/well-being- measurement.asp. promote healthy eating habits; exercise, nutrition, or physical activity for optimal health; well-being; and best care for all. Please provide input on the relevant aspects of nutrition for the IPF setting. We noted that we plan to use this input to inform our future measure development efforts. The following is a summary of the comments we received and our responses. Comment: Many commenters expressed concerns about the applicability of well-being and nutrition measures in the IPF setting, where care is focused on s y of the comments we received and our responses. Comment: Many commenters expressed concerns about the applicability of well-being and nutrition measures in the IPF setting, where care is focused on stabilizing patients experiencing acute mental health crises. They stated that these measures do not align with the primary focus of IPFs, which is safety and stabilization of severe psychiatric conditions. Several commenters were critical of the relationship between nutrition or well- being measures and the quality of care of an IPF, stating that measures on these topics were not likely to reflect patient care and rather only describe the patients’ experience in the time before they entered the IPF. Several commenters stated that many aspects of well-being and nutrition are already addressed by IPFs in current workflows, in a way that is appropriate for IPFs and tailored to individual patients’ needs. Some commenters stated concerns that measures on these topics would add administrative burden without providing meaningful benefits. Some commenters stated concerns about the operational challenges of implementing new measures, including costs, technology upgrades, and methodological issu rden without providing meaningful benefits. Some commenters stated concerns about the operational challenges of implementing new measures, including costs, technology upgrades, and methodological issues. Some commenters encouraged engagement with experts and IPF interested parties in the development of measures to address these topics. With regard to well-being, a few commenters questioned the ability of IPF patients to comprehend and accurately respond to well-being measures at the time of an IPF stay. A commenter noted that well-being measures, such as happiness and life satisfaction, are better suited to less- intensive care settings. A few commenters recommended that CMS consider scales from the Patient- Reported Outcomes Measurement Information System (PROMIS), which includes patient-centered measures covering domains like global health and social participation. A few commenters recommended that CMS consider the World Health Organization Well-Being Index (WHO–5), which is brief, validated, and applicable across psychiatric conditions. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00038 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 alidated, and applicable across psychiatric conditions. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00038 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 37665 With regard to nutrition, some commenters were concerned that full nutritional assessment for each patient would not be appropriate nor an efficient use of resources; they stated that IPFs already screen for nutritional issues and conduct further assessment or develop treatment plans as appropriate for individual cases. Commenters were mixed on their support for specific measures of nutrition. A few commenters supported the Global Malnutrition Assessment Measures, largely because it is already in use in other programs and hospital types, while a few commenters recommended that CMS select an alternative to these measures due to its administrative burden and concerns about scoring. A few commenters recommended measuring nutrition via food-related SDOH constructs, such as residing in a food desert or food insecurity. Many commenters highlighted the connection between out scoring. A few commenters recommended measuring nutrition via food-related SDOH constructs, such as residing in a food desert or food insecurity. Many commenters highlighted the connection between well-being, nutrition, and social factors, such as those assessed by the SDOH screening measure that CMS is removing from the IPFQR Program. Several commenters opposed the removal of those measures and suggested that CMS develop new measures for well-being and nutrition that align with or expand on the existing SDOH assessments. Response: We thank commenters for their responses to this comment solicitation. We will consider these comments as we continue to develop policies for future rulemaking. 3. Request for Information on Digital Quality Measurement Strategy: Approach to FHIR® Patient Assessment Reporting in the IPFQR Program Section 4125(b) of the Consolidated Appropriations Act of 2023 (CAA, 2023) (Pub. L. 117–328, Dec. 29, 2022) 21 amended section 1886(s)(4) of the Act by adding a new subparagraph (E), which requires an IPF participating in the IPFQR Program to collect and submit specified standardized patient assessment data using a new standardized patient assessment instrumen ew subparagraph (E), which requires an IPF participating in the IPFQR Program to collect and submit specified standardized patient assessment data using a new standardized patient assessment instrument, for rate year 2028 and each subsequent year. As noted in the RFI 22 in the FY 2025 IPF PPS proposed rule (‘‘Patient Assessment Instrument Under IPFQR Program (IPF PAI) to Improve the Accuracy of PPS’’), achieving interoperability is important and it is our goal to facilitate safe and secure data 21 https://www.congress.gov/117/plaws/publ328/ PLAW-117publ328.pdf. sharing, access, and utilization of electronic health information to enhance decision-making and create a more efficient healthcare system (89 FR 23201 through 23204). We also stated that we are considering ways to ensure that the Inpatient Psychiatric Facility Patient Assessment Instrument (IPF– PAI) can be represented using Fast Healthcare Interoperability Resources® (FHIR® ) standards (89 FR 23201). As part of that RFI, we requested and received input on topics including whether Standardized Patient Assessment Data Elements already in use in the CMS Data Element Library (DEL) 23 are appropriate and clinically relevant for quested and received input on topics including whether Standardized Patient Assessment Data Elements already in use in the CMS Data Element Library (DEL) 23 are appropriate and clinically relevant for the IPF setting, use of CMS reporting systems, and other interoperability-related considerations (89 FR 23201). In the FY 2025 IPF PPS final rule, we acknowledged a recommendation to align the IPF–PAI with United States Core Data for Interoperability (USCDI) 24 and several commenters noted IPFs did not receive funding to adopt CEHRT, suggesting we consider how the implementation of the IPF–PAI would affect providers without EHRs (89 FR 64646). We are considering opportunities to advance FHIR-based reporting of patient assessment data for the IPF–PAI mandated by the CAA, 2023. The FY 2026 IPF PPS proposed rule included questions in this section and sought to gain an understanding of the current adoption and use of EHRs, other health IT, and data standards supporting interoperability (such as FHIR and USCDI) within IPFs (90 FR 18520 through 90 FR 18523). We also aimed to identify the extent of technology adoption beyond certified health IT and EHRs and seek a better understanding of how as FHIR and USCDI) within IPFs (90 FR 18520 through 90 FR 18523). We also aimed to identify the extent of technology adoption beyond certified health IT and EHRs and seek a better understanding of how FHIR-standardized data can be generated, used, and shared through other technologies, without use of EHRs. Our objective was to explore how IPFs typically integrate technologies with varying complexity into existing systems and how this affects IPF workflows. We sought to identify the challenges or opportunities that may arise during this integration, and determine the support needed to complete and submit the IPF–PAIs in ways that protect and enhance care delivery. This insight will help inform the technologies we may consider for use with the IPF–PAI and quality data reporting. This same RFI also appeared in the FY 2026 IPPS proposed rule, as 22 ‘‘Patient Assessment Instrument Under IPFQR Program (IPF PAI) to Improve the Accuracy of PPS’’ (89 FR 23200 through 23204). 23 https://del.cms.gov/DELWeb/pubHome. 24 https://www.healthit.gov/isp/united-states- core-data-interoperability-uscdi. a majority of IPFs are hospital-based,25 to increase the number of interested parties who learn abo gov/DELWeb/pubHome. 24 https://www.healthit.gov/isp/united-states- core-data-interoperability-uscdi. a majority of IPFs are hospital-based,25 to increase the number of interested parties who learn about this opportunity to provide feedback (90 FR 18326 through 18327). We sought feedback on the current state of health IT use, including EHRs, in IPFs: • To what extent does your facility use health IT systems to maintain and exchange patient records? • If your facility has transitioned to using electronic records in whole or in part, what types of health IT does your IPF use to maintain patient records? Are these health IT systems certified under the Office of the National Coordinator for Health Information Technology (ONC) Health IT Certification program? 26 Does your facility use EHRs or other health IT products or systems that are not certified under the ONC Health IT Certification Program? If so, do these systems exchange data using standards and implementation specifications adopted by HHS? 27 Please specify. • Does your IPF submit patient data to CMS directly from your health IT system, without the assistance of a third-party intermediary? If a third-party intermediary is used t by HHS? 27 Please specify. • Does your IPF submit patient data to CMS directly from your health IT system, without the assistance of a third-party intermediary? If a third-party intermediary is used to report data, what type of intermediary service is used? How does your facility currently exchange health information with other healthcare providers or systems, specifically between IPFs and other provider types, or with public health agencies? What challenges do you face with the electronic exchange of health information? • Are there any challenges with your current electronic devices (for example, tablets, smartphones, computers) that hinder your ability to easily exchange information across health IT systems? Please describe any specific issues you encounter. • Does limited internet or lack of internet connectivity impact your ability to exchange data with other healthcare providers, including community-based care services, or your ability to submit patient data to CMS? • What steps does your IPF take to ensure compliance in using health IT with security and patient privacy requirements such as the requirements of the regulations promulgated under 25 We refer readers to the FY 202 oes your IPF take to ensure compliance in using health IT with security and patient privacy requirements such as the requirements of the regulations promulgated under 25 We refer readers to the FY 2025 IPF PPS-Rate Update final rule, Table 24 (89 FR 64670). Based on this data, 59.3 percent of IPFs were hospital-based units, a figure derived by dividing the sum of urban and rural units by the total number of facilities. 26 https://www.healthit.gov/topic/certification- ehrs/about-onc-health-it-certification-program. 27 For instance, see standards adopted by ASTP/ ONC on behalf of HHS in 45 CFR part 170, subpart B. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00039 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 37666 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Public Law 104–191, 110 Stat. 1936 (August 21, 1996) and related regulations? • Does your IPF refer to the SAFER Guides (see newly revised versions published in January 2025 at https:// www.healthit.gov/topic/safety/safer- guides) to self-a st 21, 1996) and related regulations? • Does your IPF refer to the SAFER Guides (see newly revised versions published in January 2025 at https:// www.healthit.gov/topic/safety/safer- guides) to self-assess EHR safety practices? 28 • What challenges or barriers does your IPF encounter when submitting quality measure data to CMS as part of the IPFQR Program? Please identify any factors that hinder successful data submission. What opportunities or factors could improve your facility’s successful data submission to CMS? • What types of technical assistance, guidance, workforce training resources, and other resources would help IPFs to successfully implement FHIR-based technologies for submitting the IPF–PAI to CMS? What strategies can CMS, HHS or other Federal partners take to ensure that technical assistance is both comprehensive and user-friendly? How could Quality Improvement Organizations or other entities enhance this support? • Is your facility using technology that utilizes APIs based on the FHIR standard to enable electronic data sharing? If so, with whom are you sharing data using the FHIR standard and for what purpose(s)? For example, have you used FHIR APIs to share data wit ed on the FHIR standard to enable electronic data sharing? If so, with whom are you sharing data using the FHIR standard and for what purpose(s)? For example, have you used FHIR APIs to share data with public health agencies? Does your facility use any Substitutable Medical Applications and Reusable Technologies (SMART) on FHIR 29 applications? If so, are the SMART on FHIR applications integrated with your EHR or other health IT? • What benefits or challenges have you experienced with implementing technology that uses FHIR-based APIs? How can adopting technology that uses FHIR-based APIs to facilitate the reporting of patient assessment data impact provider workflows? What impact, if any, does adopting this technology have on quality of care? • Does your facility have any experience using technology that shares electronic health information using one 28 The SAFER Guides are an evidence-based set of recommendations in the form of nine stand- alone, subject-oriented chapters that present the health IT community, including eligible hospitals and CAHs that use health IT, with best practice recommendations to improve the safety and safe use of EHRs. See https://www.healthit.gov/topic/ s the health IT community, including eligible hospitals and CAHs that use health IT, with best practice recommendations to improve the safety and safe use of EHRs. See https://www.healthit.gov/topic/ safety/safer-guides. 29 https://smarthealthit.org/. or more versions of the USCDI standard? 30 • Would your IPF and/or vendors be interested in participating in testing to explore options for transmission of assessments, for example, testing methods to transmit assessments that incorporate FHIR-enabled data to CMS? • What other information should we consider, to facilitate successful adoption and integration of FHIR-based technologies and standardized data for patient assessment instruments like the IPF–PAI? We invited any feedback, suggestions, best practices, or success stories related to the implementation of these technologies. The following is a summary of the comments we received to this RFI from both the FY 2026 IPF PPS proposed rule (90 FR 18520 through 90 FR 18523) and the FY 2026 IPPS proposed rule (90 FR 18326 through 18327), where this RFI also appeared. Comment: Many commenters expressed support for CMS’ intent to transition to the FHIR-based standard in IPFQR, particularly IPPS proposed rule (90 FR 18326 through 18327), where this RFI also appeared. Comment: Many commenters expressed support for CMS’ intent to transition to the FHIR-based standard in IPFQR, particularly for the IPF–PAI. A few commenters noted the opportunity for a FHIR-based standard to improve care coordination, enable actionable insights, and integrate structured data into EHRs. A few commenters highlighted the potential for FHIR to modernize behavioral health data reporting, enhance discharge planning, and enable meaningful performance measurement. Many commenters identified challenges that may hinder interoperability efforts in IPFs. Challenges shared included: inconsistent state laws governing data- sharing and outdated provider directories, expense and complexity caused by non-standard reporting requirements, internet connectivity issues (particularly in rural areas), lack of ability for some IPFs to accept direct messaging, and outdated systems, particularly in stand-alone IPFs. A few commenters noted the high cost and burden of implementing FHIR-based technologies for facilities without certified EHRs. A few commenters described variability in EHR adoption and infrastructure few commenters noted the high cost and burden of implementing FHIR-based technologies for facilities without certified EHRs. A few commenters described variability in EHR adoption and infrastructure readiness across IPF facilities. A few commenters reported adopting EHRs capable of utilizing USCDI, with a commenter indicating that most of their members have or are currently implementing EHRs that support both USCDI and FHIR. Several commenters noted that while adoption 30 For more information about USCDI see https:// www.healthit.gov/isp/united-states-core-data- interoperability-uscdi. continues to improve, they remain concerned about the low adoption rate of certified EHRs in IPFs compared to other healthcare settings. A few commenters urged CMS to provide financial incentives and technical assistance to support rural and resource- constrained IPF facilities in transitioning to FHIR-based systems. A few commenters specifically highlighted IPFs’ exclusion from the HITECH Act as a cause for many IPFs having outdated systems that are incapable of interoperable data exchange and urged CMS to provide equitable support for IPFs. Lastly, a few commenters noted that many freestanding IPF e for many IPFs having outdated systems that are incapable of interoperable data exchange and urged CMS to provide equitable support for IPFs. Lastly, a few commenters noted that many freestanding IPFs rely on non-EHR vendors for data submission, which further complicates their ability to transition to FHIR-based reporting. A few commenters provided recommendations to support the dQM transition in IPFs. Recommendations to CMS included: updating USCDI standards to incorporate specific FHIR- based data elements, providing consistent reporting processes to reduce provider burden, encouraging collaboration with health IT vendors, testing FHIR-enabled data submission methods, ensuring solutions reflect the unique needs of IPFs, and allowing 18 to 24 months for FHIR API development and testing. Response: We appreciate all the comments received on this topic as we continue transitioning to dQM in CMS quality programs, and in our efforts toward a patient-centric digital health ecosystem. VI. Collection of Information Requirements This final rule updates the prospective payment rates, outlier threshold, and wage index for Medicare inpatient hospital services provided by IPFs. In addition, w ollection of Information Requirements This final rule updates the prospective payment rates, outlier threshold, and wage index for Medicare inpatient hospital services provided by IPFs. In addition, we are finalizing the removal of one measure in the IPFQR Program that will affect the information collection burden under OMB control number 0938–0050. Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.), we are required to provide notice in the Federal Register and solicit public comment before a ‘‘collection of information’’ requirement is submitted to the Office of Management and Budget (OMB) for review and approval. For the purposes of the PRA and this section of the preamble, collection of information is defined under 5 CFR 1320.3(c) of the PRA’s implementing regulations. To fairly evaluate whether an information collection should be approved by OMB, 44 U.S.C. 3506(c)(2)(A) requires that we solicit comment on the following issues: VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00040 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, 25 Jkt 262001 PO 00000 Frm 00040 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 37667 • The need for the information collection and its usefulness in carrying out the proper functions of our agency. • The accuracy of our estimate of the information collection burden. • The quality, utility, and clarity of the information to be collected. • Recommendations to minimize the information collection burden on the affected public, including automated collection techniques. We solicited public comment (see section V.E. of the proposed rule) on each of these issues for the following sections of this document that contain information collection requirements. The following changes will be submitted to OMB for review under control number 0938–1171 (CMS– 10432). We did not propose any changes that would change any of the data collection instruments that are currently approved under that control number. In section VI.B. of this final rule, we restated our currently approved burden estimates. In section VI.C. of this final rule, we estimate the chang t are currently approved under that control number. In section VI.B. of this final rule, we restated our currently approved burden estimates. In section VI.C. of this final rule, we estimate the changes in burden associated with the update to more recent wage rates. Then in section VI.D. of this final rule, we discuss the policies finalized in this final rule. A. Wage Estimates In the FY 2025 IPF PPS final rule, we utilized the median hourly wage rate for Medical Records Specialists, in accordance with BLS, to calculate our burden estimates for the IPFQR Program (89 FR 64664). While the most recent data from the BLS reflects a mean hourly wage of $25.81 per hour for all medical records specialists, $27.69 is the mean hourly wage for ‘‘general medical and surgical hospitals,’’ which is an industry within medical records specialists.31 We believe the industry of ‘‘general medical and surgical hospitals’’’ is more specific to the IPF setting for use in our calculations than other industries that fall under medical records specialists, such as ‘‘office of physicians’’ or ‘‘nursing care facilities (skilled nursing facilities).’’ We calculated the cost of indirect costs, including fringe es that fall under medical records specialists, such as ‘‘office of physicians’’ or ‘‘nursing care facilities (skilled nursing facilities).’’ We calculated the cost of indirect costs, including fringe benefits, at 100 percent of the median hourly wage, consistent with previous years. This is necessarily a rough adjustment, both because fringe benefits and other indirect costs vary significantly by employer and methods of estimating these costs vary widely in the literature. Nonetheless, we believe that doubling the hourly wage rate ($27.69 × 2 = $55.38) to estimate total cost is a reasonably accurate estimation method. Accordingly, unless otherwise specified, we would calculate cost burden to IPFs using a wage plus benefits estimate of $55.38 per hour throughout the discussion in this section of this rule for the IPFQR Program. Some of the activities previously finalized for the IPFQR Program require beneficiaries to undertake tasks such as responding to survey questions on their own time. In the FY 2025 IPF PPS final rule, we estimated the hourly wage rate for these activities to be $24.04/hr (89 FR 64664). We are updating that estimate to a post-tax wage of $25.63/hr. The Valuing ime. In the FY 2025 IPF PPS final rule, we estimated the hourly wage rate for these activities to be $24.04/hr (89 FR 64664). We are updating that estimate to a post-tax wage of $25.63/hr. The Valuing Time in U.S. Department of Health and Human Services Regulatory Impact Analyses: Conceptual Framework and Best Practices identifies the approach for valuing time when individuals undertake activities on their own time.32 For FY 2026 we propose to derive the costs for beneficiaries using the usual weekly earnings of wage and salary workers of $1,192, divided by 40 hours to calculate an hourly pre-tax wage rate of $29.80/hr.33 We propose to adjust this rate downwards by an estimate of the effective tax rate for median income households of about 14 percent calculated by comparing pre- and post-tax income,34 resulting in the post-tax hourly wage rate of $25.63/hr. Unlike our state and private sector wage adjustments, we are not adjusting beneficiary wages for fringe benefits and other indirect costs since the individuals’ activities, if any, would occur outside the scope of their employment. B. Information Collection Requirements for the Inpatient Psychiatric Facility Quality Reporting (I t costs since the individuals’ activities, if any, would occur outside the scope of their employment. B. Information Collection Requirements for the Inpatient Psychiatric Facility Quality Reporting (IPFQR) Program 1. Previously Finalized IPFQR Program Estimates For the purposes of calculating burden, we attribute the costs to the year in which the costs begin. Under our previously finalized policies, data submission for the measures that affect the FY 2028 payment determination occurs during CY 2027 and generally reflects care provided during CY 2026. Our currently approved burden for CY 2026 is set forth in Table 7. TABLE 7—PREVIOUSLY FINALIZED IPFQR PROGRAM INFORMATION COLLECTION BURDEN FOR CY 2026 Measure/response description Number respondents Number of responses/ respondent Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Applicable wage rate ($/hr) Cost per facility ($) Total annual cost ($) Hours of Physical Restraint Use Hours of Seclusion Use ............ Follow-Up After Psychiatric Hospitalization ....................... Alcohol Use Brief Intervention Provided or Offered and SUB–2a Alcohol Use Brief Intervention .............. clusion Use ............ Follow-Up After Psychiatric Hospitalization ....................... Alcohol Use Brief Intervention Provided or Offered and SUB–2a Alcohol Use Brief Intervention ............................ Alcohol and Other Drug Use Disorder Treatment Provided or Offered at Discharge and SUB–3a Alcohol and Other Drug Use Disorder Treatment at Discharge .......................... Tobacco Use Treatment Pro- vided or Offered at Discharge and TOB–3a Tobacco Use Treatment at Discharge ......... Influenza Immunization ............. 1,596 1,596 1,596 1,261 1,261 2,012,556 2,012,556 0 0 0.25 0.25 0 315 315 0 503,139 503,139 52.12 52.12 16,431 16,431 26,223,605 26,223,605 0 52.12 0 0 1,596 609 971,964 0.25 152 242,991 52.12 7,935 12,664,691 1,596 609 971,964 0.25 152 242,991 52.12 7,935 12,664,691 1,596 1,596 609 609 971,964 971,964 0.25 0.25 152 152 242,991 242,991 52.12 52.12 7,935 7,935 12,664,691 12,664,691 31 https://www.bls.gov/oes/current/ oes292072.htm. 33 https://www.bls.gov/news.release/pdf/ wkyeng.pdf. Accessed January 24, 2025. 32 https://aspe.hhs.gov/reports/valuing-time-us- 34 https://www.census.gov/library/publications/ department-health-human-services-regulatory- im ews.release/pdf/ wkyeng.pdf. Accessed January 24, 2025. 32 https://aspe.hhs.gov/reports/valuing-time-us- 34 https://www.census.gov/library/publications/ department-health-human-services-regulatory- impact-analyses-conceptual-framework. 2024/demo/p60-282.html. Accessed January 24, 2025. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00041 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 37668 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations TABLE 7—PREVIOUSLY FINALIZED IPFQR PROGRAM INFORMATION COLLECTION BURDEN FOR CY 2026—Continued Measure/response description Number respondents Number of responses/ respondent Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Applicable wage rate ($/hr) Cost per facility ($) Total annual cost ($) Transition Record with Speci- fied Elements Received by Discharged Patients (Dis- charges from an Inpatient Fa- cility to Home/Self Care or Any Other Site of Care) ......... Screening for Metabolic Dis- orders ..................................... Thirty-Day All-Cause Unplanned Readmission Following Ps ient Fa- cility to Home/Self Care or Any Other Site of Care) ......... Screening for Metabolic Dis- orders ..................................... Thirty-Day All-Cause Unplanned Readmission Following Psy- chiatric Hospitalization in an Inpatient Psychiatric Facility .. 30-Day Risk-Standardized All- Cause Emergency Depart- ment Visit Following an Inpa- tient Psychiatric Facility Dis- charge measure ..................... Medication Continuation Fol- lowing Inpatient Psychiatric Discharge ............................... Modified COVID–19 Healthcare Personnel (HCP) Vaccination Measure * ............................... Facility Commitment to Health Equity * ................................... Screening for Social Drivers of Health (Data Submission) * ... Screen Positive Rate for Social Drivers of Health * .................. Non Measure Data Collection ... Subtotal for Medical Records Specialists .............................. Screening for Social Drivers of Health (Patient Screening) * .. Psychiatric Inpatient Experience Survey .................................... Subtotal for Individuals .............. Totals ................................. 1,596 1,596 1,596 1,596 1,596 1,596 1,596 798 chiatric Inpatient Experience Survey .................................... Subtotal for Individuals .............. Totals ................................. 1,596 1,596 1,596 1,596 1,596 1,596 1,596 798 798 1,596 1,596 1,596 798 1,596 1,596 609 609 971,964 971,964 0.25 0.25 152 152 242,991 52.12 7,935 12,664,691 242,991 52.12 7,935 12,664,691 0 0 0 0 1 1 1 4 0 0 0 0 0 0 0 0 1,596 798 798 6,384 0.167 0.167 0.167 0.5 0 0 0 0 0 0 0 2 0 52.12 0 0 0 267 133 133 3,192 52.12 52.12 52.12 52.12 52.12 52.12 52.12 0 0 0 0 9 9 9 104 0 0 0 0 13,892 6,946 6,946 166,367 6,183 9,866,472 Varies 1,547 2,467,949 52.12 80,604 128,629,505 1,261 2,012,556 0.033 300 1,561 239,400 2,251,956 0.121 Varies 42 36 78 66,414 24.04 1,000 1,596,601 28,967 95,382 24.04 24.04 873 1,873 696,376 2,292,977 7,744 12,118,428 Varies 1,624 2,563,331 N/A 82,477 130,922,482 * We note that we are removing these measures in this final rule. 2. Updates Due to More Recent Information In section VI.A. of this final rule, we describe our updated wage rates which increase from $52.12/hr to $55.38/hr (an increase of $3.26/hr) for activities performed by Medical Records Specialists and from $24.04/hr to $25.63/hr (an increase of $1.59 ur updated wage rates which increase from $52.12/hr to $55.38/hr (an increase of $3.26/hr) for activities performed by Medical Records Specialists and from $24.04/hr to $25.63/hr (an increase of $1.59/hr) for activities performed by individuals. The effects of these updates are set forth in Table 8. TABLE 8—EFFECTS OF WAGE RATE UPDATES Measure/response description Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Change in applicable wage rate ($/hr) Change in cost per facility ($) Change in total annual cost ($) Subtotal for Medical Records Special- 9,866,472 Varies .................... 1,547 2,467,949 ists. Subtotal for Individuals .......................... 2,251,956 Varies .................... 78 95,382 3.26 1.59 5,042 8,045,514 124 151,657 Totals ............................................. 12,118,428 Varies .................... 1,624 2,563,331 Varies 5,165 8,197,171 3. Updates Due to Policies in This Final Rule In section V.B. of this final rule, we are finalizing changes to begin use of the 30-Day Risk-Standardized All-Cause Emergency Department (ED) Visit Following an IPF Discharge measure (IPF ED Visit measure) in the IPFQR Pro final rule, we are finalizing changes to begin use of the 30-Day Risk-Standardized All-Cause Emergency Department (ED) Visit Following an IPF Discharge measure (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. As discussed in the FY 2025 IPF PPS final rule, the IPF ED Visit measure is a claims-based measure and there is no additional burden outside of submitting a claim, the submission of which is approved under OMB control number 0938–0050 (89 FR 64667). This rule does not warrant any changes under that control number. In section V.C. of this final rule, we are removing the Facility Commitment to Health Equity measure from the IPFQR Program beginning with the FY 2026 payment determination. This measure and the associated information collection burden was previously finalized in the FY 2024 IPF PPS final rule and is approved under OMB control nu ng with the FY 2026 payment determination. This measure and the associated information collection burden was previously finalized in the FY 2024 IPF PPS final rule and is approved under OMB control number 0938–1171 (88 FR VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00042 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 37669 51151). We estimate that this removal would result in a total annual burden decrease of 267 hours (0.167 hours × 1,596 IPFs) at a savings of $14,761 (267 hours × $55.38/hour). This estimate is summarized in Table 9. In section V.D. of this final rule, we are removing the COVID–19 Vaccination Coverage Among Healthcare Personnel (HCP) measure from the IPFQR Program beginning with the FY 2026 payment determination. This measure and the associated information collection burden was previously finalized in the FY 2022 IPF PPS final rule and is approved under OMB control number 0920–1317 (86 FR 42668 and 42669). IPFs have the option to manually enter data directly into the Centers for Disease Control and Pre FY 2022 IPF PPS final rule and is approved under OMB control number 0920–1317 (86 FR 42668 and 42669). IPFs have the option to manually enter data directly into the Centers for Disease Control and Prevention (CDC) National Healthcare Safety Network (NHSN) web- based application or by uploading a CSV file. CDC estimates that each IPF requires between 40 minutes (0.67 hours) to upload a CSV file and 45 minutes (0.75 hours) monthly to enter the data manually. Therefore, we estimate that this removal will result in a decrease in burden of between 12,768 hours (0.67 hours × 12 months × 1,596 IPFs) and 14,364 hours (0.75 hours × 12 months × 1,596 IPFs) annually across all 1,596 IPFs. While there is no information collection burden associated with this measure under OMB control number 0938–0050, we have included the removal of this measure in Table 9 to be consistent with the measure’s inclusion in Table 8. In section V.E. of this final rule, we are removing 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. These measures and the associated information collectio f Health and Screen Positive Rate for Social Drivers of Health measures from the IPFQR Program beginning with the FY 2026 payment determination. These measures and the associated information collection burden were previously finalized in the FY 2023 IPF PPS final rule and are approved under OMB control number 0938–1171 (88 FR 51150 through 51153). With regard to the Screening for Social Drivers of Health measure, there are two components: patient screening for five health-related social needs domains and IPF submission of aggregated IPF-level measure data. For the Screen Positive Rate for Social Drivers of Health measure, IPFs are required to report on an annual basis the number of patients who screen positive for one or more of the five Social Drivers of Health domains divided by the total number of patients screened (reported as five separate rates). With regard to patient screening, the currently approved burden estimate under OMB control number 0938–1171 for the FY 2026 payment determination and subsequent years is 66,414 hours annually for 2,012,556 patients (0.033 hours × 2,012,556 patients). With regard to measure reporting, due to data submission being voluntary for the FY ermination and subsequent years is 66,414 hours annually for 2,012,556 patients (0.033 hours × 2,012,556 patients). With regard to measure reporting, due to data submission being voluntary for the FY 2026 payment determination, the currently approved burden estimate is 133 hours annually across 798 IPFs (0.167 hours × 798 IPFs) per measure. For mandatory data submission in the FY 2027 payment determination and subsequent years, the currently approved burden estimate is 267 hours annually across 1,596 IPFs (0.167 hours × 1,596 IPFs) per measure. Therefore, we estimate that this policy would result in a decrease in burden of 66,680 hours (66,414 + 133 + 133) annually across all 1,596 IPFs for the FY 2026 payment determination and 66,948 hours (66,414 + 267 + 267) annually across all 1,596 IPFs for the FY 2027 payment determination and subsequent years. These estimates are summarized in Tables 9 through 11. In section V.F. of this final rule, we are finalizing changes to our codified ECE policy. Because the process for requesting or granting an ECE would remain the same as the current ECE process, these updates would not affect burden associated with the submission of the ECE form, wh policy. Because the process for requesting or granting an ECE would remain the same as the current ECE process, these updates would not affect burden associated with the submission of the ECE form, which is accounted for under OMB control number 0938–1022 (expiration date April 30, 2027). In total, for CY 2026 we estimate a decrease in burden of 66,947 hours (267 + 66,414 + 133 + 133) at a savings of $1,731,712 ($14,761 + $1,702,191 + $7,380 + $7,380). We estimate that beginning with CY 2027 the savings will increase to a total reduction in burden of 67,215 (267 + 66,414 + 267 + 267) hours at a savings of $1,746,474 ($14,761 + $1,702,191 + $14,761 + $14,761) associated with these policies. TABLE 9—TOTAL CY 2026 FACILITY INFORMATION COLLECTION BURDEN CHANGES Measure/response description Number respondents Number of responses/ respondent Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Total annual cost ($) Facility Commitment to Health Equity Modified COVID–19 Healthcare Per- sonnel (HCP) Vaccination Meas- ure .................................................. Screening for Social Drivers of Health (Data Submission) ............. Screen y Modified COVID–19 Healthcare Per- sonnel (HCP) Vaccination Meas- ure .................................................. Screening for Social Drivers of Health (Data Submission) ............. Screen Positive Rate for Social Driv- ers of Health .................................. 1,596 1,596 798 798 Total ........................................... 1,596 1 0 1 1 1 (1,596) 0.167 (0.167) (267) (14,761) 0 (798) (798) (3,192) 0 0.167 0.167 0.167 0 (0.167) (0.167) (0.5) 0 (133) (133) (533) 0 (7,380) (7,380) (29,521) TABLE 10—TOTAL CY 2026 PATIENT SURVEY INFORMATION COLLECTION BURDEN CHANGES Measure/response description Number respondents Number of responses/ respondent Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Total annual cost ($) Screening for Social Drivers of Health (Patient Screening) ............ Total ........................................... 1,596 1,596 1,261 (2,012,556) 1,261 (2,012,556) 0.033 0.033 (41.6) (66,414) (1,702,191) (41.6) (66,414) (1,702,191) VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o 41.6) (66,414) (1,702,191) VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4700 E:\FR\FM\05AUR2.SGM 05AUR2 2 S E L U R h t i w D O R P 3 2 N Q X 1 1 K S D n o r e t t o l 37670 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations TABLE 11—TOTAL CY 2027 FACILITY INFORMATION COLLECTION BURDEN CHANGES Measure/response description Number respondents Number of responses/ respondent Total annual responses Time per response (hrs) Time per facility (hrs) Total annual time (hrs) Total annual cost ($) Screening for Social Drivers of Health (Data Submission) ............. Screen Positive Rate for Social Driv- ers of Health .................................. Total ........................................... 798 798 798 1 1 1 (798) (798) (1,596) 0.167 0.167 0.167 (0.167) (0.167) (0.33) (133) (133) (267) (7,380) (7,380) (14,761) We invited public comments on the proposed removal of the SDOH information collection requirements and whether our estimated burden reduction of 0.033 hours per patient and an annual decrease of 0.167 hours in burden per IPF for each measure is an accurate estimate. Comments: We received no comments. C. Sub er our estimated burden reduction of 0.033 hours per patient and an annual decrease of 0.167 hours in burden per IPF for each measure is an accurate estimate. Comments: We received no comments. C. Submission of PRA-Related Comments We have submitted a copy of the information collection requirements related to this rule to OMB for their review. The requirements are not effective until they have been approved by OMB. To obtain copies of the supporting statement and any related forms for the collections discussed previously, please visit the CMS website at https:// www.cms.gov/regulationsand-guidance/ legislation/paperworkreduction actof1995/pralisting, or call the Reports Clearance Office at 410–786–1326. VII. Regulatory Impact Analysis A. Statement of Need This rule finalizes updates to the prospective payment rates for Medicare inpatient hospital services provided by IPFs for discharges occurring during FY 2026 (October 1, 2025, through September 30, 2026). We are finalizing our proposal to apply the 2021-based IPF market basket increase for FY 2026 of 3.2 percent, reduced by the productivity adjustment of 0.7 percentage point as required by section 1886(s)(2)(A)(i) of the Act for al to apply the 2021-based IPF market basket increase for FY 2026 of 3.2 percent, reduced by the productivity adjustment of 0.7 percentage point as required by section 1886(s)(2)(A)(i) of the Act for a total FY 2026 payment rate update of 2.5 percent. In this final rule, we are finalizing our proposal to update the outlier fixed dollar loss threshold amount, update the IPF labor-related share and update the IPF wage index to reflect the FY 2026 hospital inpatient wage index. Section 1886(s)(4) of the Act requires IPFs to report data in accordance with the requirements of the IPFQR Program for purposes of measuring and making publicly available information on health care quality; and links the quality data submission to the annual applicable percentage increase. B. Overall Impact We have examined the impacts of this rule as required by Executive Order 12866, ‘‘Regulatory Planning and Review’’; Executive Order 13132, ‘‘Federalism’’; Executive Order 13563, ‘‘Improving Regulation and Regulatory Review’’; Executive Order 14192, ‘‘Unleashing Prosperity Through Deregulation’’; the Regulatory Flexibility Act (RFA) (Pub. L. 96–354); section 1102(b) of the Social Security Act; and section 20 atory Review’’; Executive Order 14192, ‘‘Unleashing Prosperity Through Deregulation’’; the Regulatory Flexibility Act (RFA) (Pub. L. 96–354); section 1102(b) of the Social Security Act; and section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4); and the Congressional Review Act (5 U.S.C. 801–808). Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select those regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Section 3(f) of Executive Order 12866 defines a ‘‘significant regulatory action’’ as any regulatory action that is likely to result in a rule that may: (1) have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) ma ent, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, or the President’s priorities. A regulatory impact analysis (RIA) must be prepared for a regulatory action that is significant under section 3(f)(1) of E.O. 12866. We estimate that the total impact of these changes for FY 2026 payments compared to FY 2025 payments will be an increase of approximately $70 million. This reflects a $70 million increase from the update to the payment rates (+$90 million from the 2021-based IPF market basket increase of 3.2 percent, and ¥$20 million for the productivity adjustment of 0.7 percentage point). Outlier payments are estimated to change from 2.1 percent in FY 2025 to 2.0 percent of total estimated IPF payments in FY 2026. While it does not affect the overall impact, we estimate this change in outlier payments will reduce total IPF PPS p m 2.1 percent in FY 2025 to 2.0 percent of total estimated IPF payments in FY 2026. While it does not affect the overall impact, we estimate this change in outlier payments will reduce total IPF PPS payments by approximately $3 million. Based on our estimates, OMB’s Office of Information and Regulatory Affairs has determined that this rulemaking is ‘‘significant,’’ though not significant under section 3(f)(1) of Executive Order 12866. Nevertheless, because of the potentially substantial impact to IPF providers, we have prepared an RIA that to the best of our ability presents the costs and benefits of the rulemaking. OMB has reviewed these final regulations, and the Departments have provided the following assessment of their impact. C. Detailed Economic Analysis In this section, we discussed the historical background of the IPF PPS and the impact of the final rule on the Federal Medicare budget and on IPFs. 1. Budgetary Impact As discussed in the RY 2005 and RY 2007 IPF PPS final rules, we applied a budget neutrality factor to the Federal per diem base rate and ECT payment per treatment to ensure that total estimated payments under the IPF PPS in the implementation period would equa we applied a budget neutrality factor to the Federal per diem base rate and ECT payment per treatment to ensure that total estimated payments under the IPF PPS in the implementation period would equal the amount that would have been paid if the IPF PPS had not been implemented. This budget neutrality factor included the following components: outlier adjustment, stop loss adjustment, and the behavioral offset. As discussed in the RY 2009 IPF PPS notice (73 FR 25711), the stop-loss adjustment is no longer applicable under the IPF PPS. As discussed in section IV.D.4.c. of this final rule, we are updating the wage index and labor-related share in a budget neutral manner by applying a wage index budget neutrality factor to VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00044 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 37671 the Federal per diem base rate and ECT payment per treatment. In addition, as discussed in section IV.D.9. of this final rule, we are applying a refinement standardization factor to the Federal per diem Federal per diem base rate and ECT payment per treatment. In addition, as discussed in section IV.D.9. of this final rule, we are applying a refinement standardization factor to the Federal per diem base rate and ECT payment per treatment to account for the revisions to the adjustment factors for teaching status and for IPFs located in rural areas (as previously discussed in sections IV.D.5 and IV.D.6 of this final rule, and summarized in Addendum A), which must be made budget-neutrally. Therefore, the budgetary impact to the Medicare program of this final rule will be due to the final market basket increase for FY 2026 of 3.2 percent (see section IV.A.2 of this final rule) reduced by the productivity adjustment of 0.7 percentage point required by section 1886(s)(2)(A)(i) of the Act and the update to the outlier fixed dollar loss threshold amount. We estimate that the impact of the FY 2026 IPF PPS final rule will be a net increase of $70 million in payments to IPF providers. This reflects an estimated $70 million increase from the update to the payment rates and the $3 million decrease as a result of the update to the outlier threshold amount as noted earlier. This estimate does n ects an estimated $70 million increase from the update to the payment rates and the $3 million decrease as a result of the update to the outlier threshold amount as noted earlier. This estimate does not include the implementation of the required 2.0 percentage point reduction of the market basket update factor for any IPF that fails to meet the IPF quality reporting requirements (as discussed in section IV.B.3. of this final rule). 2. Impact on Providers To show the impact on providers of the changes to the IPF PPS discussed in this final rule, we compared estimated payments under the IPF PPS rates and factors for FY 2026 versus those under FY 2025. We determined the percent change in the estimated FY 2026 IPF PPS payments compared to the estimated FY 2025 IPF PPS payments for each category of IPFs. In addition, for each category of IPFs, we have included the estimated percent change in payments resulting from the update to the outlier fixed dollar loss threshold amount; the revisions to the facility- level adjustment factors; the updated wage index data and labor-related share; and the market basket increase for FY 2026, as reduced by the productivity adjustment according to secti to the facility- level adjustment factors; the updated wage index data and labor-related share; and the market basket increase for FY 2026, as reduced by the productivity adjustment according to section 1886(s)(2)(A)(i) of the Act. To illustrate the impacts of the changes to the IPF PPS discussed in this final rule, our analysis begins with FY 2024 IPF PPS claims (based on the 2024 MedPAR claims, March 2025 update). We estimated FY 2025 IPF PPS payments using these 2024 claims, the finalized FY 2025 IPF PPS Federal per diem base rate and ECT per treatment amount, and the finalized FY 2025 IPF PPS patient- and facility-level adjustment factors (as published in the FY 2025 IPF PPS final rule (89 FR 64582)). We then estimated the FY 2025 outlier payments based on these simulated FY 2025 IPF PPS payments using the same methodology as finalized in the FY 2025 IPF PPS final rule (89 FR 64636 and 64637) where total outlier payments are maintained at 2 percent of total estimated FY 2025 IPF PPS payments. Each of the following changes is added incrementally to this baseline model in order to isolate the effects of each change: • The update to the outlier fixed dollar loss threshold amount. S payments. Each of the following changes is added incrementally to this baseline model in order to isolate the effects of each change: • The update to the outlier fixed dollar loss threshold amount. • The revisions to facility-level adjustment factors for teaching status and for IPFs located in rural areas. • The FY 2026 IPF wage index and the FY 2026 labor-related share. • The IPF market basket increase for FY 2026 of 3.2 percent reduced by the productivity adjustment of 0.7 percentage point in accordance with section 1886(s)(2)(A)(i) of the Act for a FY 2026 payment rate update of 2.5 percent. Our column comparison in Table 12 illustrates the percent change in payments from FY 2025 (that is, October 1, 2024, to September 30, 2025) to FY 2026 (that is, October 1, 2025, to September 30, 2026) including all the final payment policy changes. TABLE 12—FY 2026 IPF PPS PAYMENT IMPACTS Facility by Type Number of Facilities Outlier Refinement of Facility-Level Adjustments Wage Index FY26, Labor Related Share, and 5% Cap Total Percent Change 1 (1) (2) (3) (4) (5) (6) All Facilities ................................................................ Total Urban ............................... bor Related Share, and 5% Cap Total Percent Change 1 (1) (2) (3) (4) (5) (6) All Facilities ................................................................ Total Urban ......................................................... Urban unit .................................................... ............................................. Urban hospital Total Rural .......................................................... Rural unit ..................................................... Rural hospital ............................................... By Type of Ownership: Freestanding IPFs: Urban Psychiatric Hospitals: Government .......................................... Non-Profit ............................................. For-Profit ............................................... Rural Psychiatric Hospitals: Government .......................................... Non-Profit ............................................. For-Profit ............................................... IPF Units: Urban: Government .......................................... Non-Profit ............................................. For-Profit ............................................... Rural: Government .... Urban: Government .......................................... Non-Profit ............................................. For-Profit ............................................... Rural: Government .......................................... Non-Profit ............................................. For-Profit ............................................... 1,387 1,147 628 519 240 178 62 112 97 310 28 13 21 91 419 118 41 99 38 ¥0.1 ¥0.1 ¥0.1 0.0 0.0 0.0 0.0 ¥0.1 0.0 0.0 0.0 ¥0.1 0.0 ¥0.2 ¥0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.4 ¥0.5 0.2 0.2 0.2 0.7 ¥0.3 ¥0.7 0.2 0.3 0.1 1.4 0.3 ¥0.4 0.2 0.2 0.1 0.0 0.1 0.1 0.0 ¥0.4 ¥0.4 ¥0.3 0.4 ¥0.1 ¥0.1 0.3 ¥0.6 ¥0.5 ¥0.1 0.3 ¥0.1 ¥0.5 ¥0.1 ¥0.9 2.4 2.5 2.9 1.9 2.3 2.2 2.3 3.5 2.1 1.6 2.9 2.0 2.1 3.7 3.0 2.0 2.1 2.6 1.7 VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00045 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 37672 Federal Register / Vol. 90, No. 148 / Tuesday, August 5, 2025 / Rules and Regulations TABLE 12—FY 2026 IPF PPS PAYMENT IMPACTS—Continued Facility by Type Number of Facilities Outlier Refinement of Facility-Level Adjustments Wage Index FY26, Labor Related Share, and ules and Regulations TABLE 12—FY 2026 IPF PPS PAYMENT IMPACTS—Continued Facility by Type Number of Facilities Outlier Refinement of Facility-Level Adjustments Wage Index FY26, Labor Related Share, and 5% Cap Total Percent Change 1 (1) (2) (3) (4) (5) (6) By Teaching Status: Non-teaching ....................................................... Less than 10% interns and residents to beds .... 10% to 30% interns and residents to beds ........ More than 30% interns and residents to beds ... 1,178 103 79 27 By Region: New England ...................................................... Mid-Atlantic ......................................................... South Atlantic ..................................................... East North Central .............................................. ............................................. East South Central West North Central ............................................. West South Central ............................................ Mountain ............................................................. Pacific ................................................................. By Bed Size: Psychiatric Hospitals: Beds: 0–24 ....................... ....................................................... Pacific ................................................................. By Bed Size: Psychiatric Hospitals: Beds: 0–24 .................................................. Beds: 25–49 ................................................ Beds: 50–75 ................................................ Beds: 76 + ................................................... Psychiatric Units: Beds: 0–24 .................................................. Beds: 25–49 ................................................ Beds: 50–75 ................................................ Beds: 76 + ................................................... 94 195 222 218 136 88 214 95 125 91 88 94 308 402 231 100 73 0.0 ¥0.1 ¥0.1 ¥0.2 ¥0.1 ¥0.1 0.0 0.0 0.0 ¥0.1 0.0 0.0 ¥0.1 0.0 0.0 0.0 0.0 0.0 ¥0.1 ¥0.1 ¥0.1 ¥0.6 0.5 3.0 10.4 0.1 0.3 0.4 ¥0.2 ¥0.2 0.0 ¥0.2 ¥0.3 ¥0.2 ¥0.4 ¥0.7 ¥0.4 ¥0.4 ¥0.1 0.6 0.6 0.7 0.0 ¥0.1 0.2 ¥0.6 1.2 ¥0.2 0.1 0.4 0.2 1.0 ¥0.8 0.3 ¥0.9 ¥0.2 0.3 0.0 ¥0.2 0.0 0.1 0.2 0.0 1.9 2.9 5.7 12.3 3.8 2.5 2.9 2.6 2.4 3.4 1.5 2.4 1.3 1.9 2.1 2.1 1.9 2.3 3.2 3.2 3.1 1 This column includes the impact of the updates in columns (3) through (5) above, and of the ¥0.2 0.0 0.1 0.2 0.0 1.9 2.9 5.7 12.3 3.8 2.5 2.9 2.6 2.4 3.4 1.5 2.4 1.3 1.9 2.1 2.1 1.9 2.3 3.2 3.2 3.1 1 This column includes the impact of the updates in columns (3) through (5) above, and of the final IPF market basket update factor for FY 2026 (3.2 percent), reduced by 0.7 percentage point for the productivity adjustment as required by section 1886(s)(2)(A)(i) of the Act. 3. Impact Results Table 12 displays the results of our analysis. The table groups IPFs into the categories listed here based on characteristics provided in the Provider of Services file, the IPF PSF, and cost report data from the Healthcare Cost Report Information System: • Facility Type. • Location. • Teaching Status Adjustment. • Census Region. • Size. The top row of the table shows the overall impact on the 1,387 IPFs included in the analysis. In column 2, we present the number of facilities of each type that had information available in the PSF and had claims in the MedPAR dataset for FY 2024. In column 3, we present the effects of the update to the outlier fixed dollar loss threshold amount. We estimate that IPF outlier payments as a percentage of total IPF payments are 2.1 percent in FY 2025. Therefore e present the effects of the update to the outlier fixed dollar loss threshold amount. We estimate that IPF outlier payments as a percentage of total IPF payments are 2.1 percent in FY 2025. Therefore, we adjusted the outlier threshold amount to maintain total estimated outlier payments equal to 2.0 percent of total payments in FY 2026. The estimated change in total IPF payments for FY 2026, therefore, includes an approximate 0.1 percent decrease in payments because we would expect the outlier portion of total payments to decrease from approximately 2.1 percent to 2.0 percent. The overall impact of the estimated decrease to payments due to updating the outlier fixed dollar loss threshold (as shown in column 3 of Table 12), across all hospital groups, is a 0.1 percent decrease. The largest decrease in payments due to this change is estimated to be 0.2 percent for urban government-owned IPF units. In column 4, we present the effects of the final revisions to the facility-level adjustment factors and the application of the refinement standardization factor that is discussed in section IV.D.9 of this final rule. We estimate the largest payment increase of 10.4 percent will be for teach factors and the application of the refinement standardization factor that is discussed in section IV.D.9 of this final rule. We estimate the largest payment increase of 10.4 percent will be for teaching IPFs with more than 30 percent interns and residents to beds. Conversely, we estimate that urban for- profit hospitals will experience the largest payment decrease of 0.7 percent. Payments to IPF units in urban areas will increase by 0.4 percent, and payments to IPF units in rural areas will increase by 0.2 percent. In column 5, we present the effects of the budget-neutral update to the IPF wage index and the labor-related share. In addition, this column includes the application of the 5-percent cap on any decrease to a provider’s wage index from its wage index in the prior year as finalized in the FY 2023 IPF PPS final rule (87 FR 46856 through 46859). The change in this column represents the effect of using the concurrent hospital wage data as discussed in section IV.D.4.c. of this final rule. That is, the impact represented in this column reflects the final update from the FY 2025 IPF wage index to the final FY 2026 IPF wage index, which includes basing the FY 2026 IPF wage inde inal rule. That is, the impact represented in this column reflects the final update from the FY 2025 IPF wage index to the final FY 2026 IPF wage index, which includes basing the FY 2026 IPF wage index on the FY 2026 pre-floor, pre-reclassified IPPS hospital wage index data, applying a 5-percent cap on any decrease to a provider’s wage index from its wage index in the prior year, and updating the labor-related share from 78.8 percent in FY 2025 to 79.0 percent in FY 2026. We note that there is no projected change in aggregate payments to IPFs, as indicated in the first row of column 5; however, there will be distributional effects among different categories of IPFs. For example, we estimate the largest increase in payments to be 1.2 percent for IPFs in New England, and the largest decrease in payments to be 0.9 percent for IPFs in the Pacific region and rural for-profit IPF units. VerDate Sep 2014 19:33 Aug 04, 2025 Jkt 262001 PO 00000 Frm 00046 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 37673 Overall, IPFs are estimated to experie 5AUR2 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 37673 Overall, IPFs are estimated to experience a net increase in payments of 2.4 percent as a result of the updates in this final rule. IPF payments are therefore estimated to increase by 2.5 percent in urban areas and 2.3 percent in rural areas. The largest payment increase is estimated at 12.3 percent for IPFs with more than 30 percent interns and residents to beds. 4. Effect on Beneficiaries Under the FY 2026 IPF PPS, IPFs will continue to receive payment based on the average resources consumed by patients for each day. Our longstanding payment methodology reflects the differences in patient resource use and costs among IPFs, as required under section 124 of the BBRA. We expect that updating IPF PPS rates in this rule will improve or maintain beneficiary access to high- quality care by ensuring that payment rates reflect the best 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 wi