AHA Comments on CMS Long-term Care Hospital FY 2026 Proposed Payment Rule

June 10, 2025 

The Honorable Mehmet Oz, M.D.
Administrator
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, MD 21244-1850

Submitted Electronically

Re: Medicare 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 2026 Rates; Requirements for Quality Programs; and Other Policy Changes; 90 Fed. Reg. 18,002 (April 30, 2025).

Dear Administrator Oz:

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, including approximately 230 long-term care hospitals (LTCHs), 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) 2026 LTCH prospective payment system (PPS) proposed rule. We are submitting separate comments on the rule’s inpatient PPS and Transforming Episode Accountability Model proposals.

LTCHs care for some of the most complex and severely ill Medicare beneficiaries. As CMS points out in this rule, more than 90 percent of Medicare patients are dependent on a ventilator when arriving at an LTCH, have spent three or more days in an intensive care unit (ICU), or both. These patients have high rates of complex wounds, chronic illness, and other factors that make the LTCH patient population a uniquely resource-intensive group. For this reason, LTCHs maintain a deeply specialized expertise that enables them to care for these patients and maximize their chances of recovery. Indeed, many acute-care hospitals rely on LTCHs as partners to care for patients with these specific high-acuity needs by transferring them to LTCHs.

Unfortunately, and as explained further in this letter, Medicare payment dynamics and related factors have caused a contraction of the LTCH field. This not only limits the ability of certain high-need patients from receiving care at an LTCH, but also strains the entire continuum of care as acute-care hospitals and other providers must find ways to care for these patients. This rule has several proposals that will exacerbate the ongoing difficulties within the LTCH field, particularly the large proposed increase in the high-cost outlier threshold. The AHA offers numerous recommendations to mitigate these effects, and we urge CMS to adopt them in the final rule.

While we have concerns about the payment updates for this proposed rule, the AHA appreciates CMS’ efforts to alleviate the reporting burden on providers. Specifically, the AHA supports CMS’ proposal to remove four standardized patient assessment data elements (SPADEs) from the LTCH QRP and greatly appreciates CMS’ recognition of the need to balance administrative burden and value in quality measurement programs. By streamlining reporting requirements, CMS can free providers to focus on the quality and safety issues that matter the most to their patients. In addition, the AHA appreciates CMS’ efforts around deregulation and is responding to CMS’ Request for Information (RFI) on approaches and opportunities to streamline regulations and reduce administrative burdens on providers.

Our detailed comments follow.