August 5, 2021

CMS issues IPPS final rule for FY 2022

By: Judy Mathias
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Editor's Note

The Centers for Medicare and Medicaid Services (CMS) on August 2 issued its final Inpatient Prospective Payment System (IPPS) rule for FY 2022.

The final rule:


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  • increases Medicare payment rates by a net 2.5%, compared to FY 2021, for hospitals that are meaningful users of electronic health records and that submit quality measure data
  • repeals the requirement to report median payer-negotiated rates for inpatient services, by Medicare severity diagnosis related group (MS-DRG), for Medicare Advantage organizations, and it repeals the market-based MS-DRG relative weight methodology CMS planned to implement in FY 2024
  • makes changes to quality measurement and value programs in response to the COVID-19 pandemic, which will result in hospitals reporting a new measure reflecting the proportion of their healthcare personnel who are vaccinated, and CMS will suppress most hospital value-based purchasing program measures for FY 2022, resulting in neutral payment adjustments
  • excludes performance data from 2020 in calculating the hospital-acquired condition reduction program performance for FYs 2022 and 2023, and suppresses the pneumonia readmission measure for the FY 2023 hospital readmission reduction program.

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