AHA Comment on the CMS' Fiscal Year 2025 LTCH Prospective Payment System Proposed Rule

June 7, 2024

The Honorable Chiquita Brooks-LaSure
Centers for Medicare & Medicaid Services,
Attention: CMS-1808-P
P.O. Box 8013
Baltimore, MD 21244-8013

Submitted Electronically

Re: Medicare and Medicaid Programs and the Children's Health Insurance Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year 2025 Rates; Quality Programs Requirements; and Other Policy Changes; 89 Fed. Reg. 35,934 (May 2, 2024).

Dear Administrator Brooks-LaSure:

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, including approximately 230 long-term care hospitals (LTCH), and our clinician partners — more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the American Hospital Association (AHA) appreciates the opportunity to comment on the Centers for Medicare & Medicaid Services’ (CMS) fiscal year (FY) 2025 LTCH prospective payment system (PPS) proposed rule. We are submitting separate comments on the rule’s inpatient PPS and Transforming Episode Accountability Model proposals.

AHA has serious concerns about this year’s proposed payment updates for LTCHs. First, as AHA demonstrates, market basket updates have lagged real inflation for numerous consecutive years. In addition, the sharp rise in the fixed-loss amount for outlier payments has forced LTCHs to absorb hundreds of millions in losses for treating high-acuity patients. The combination of these factors, and the difficult inflationary environment facing hospitals, is seriously jeopardizing access for severely ill patients. AHA urges CMS to take action to address these issues and provides specific recommendations below.