Advocacy Alert

Urge Your Lawmakers to Support Essential Health System Designation

Association Comments on FY 2023 IPPS Proposed Rule

Abigail Painchaud
June 20, 2022

In a June 17, 2022, letter to the Centers for Medicare & Medicaid Services (CMS), America’s Essential Hospitals responded to annual updates to the Inpatient Prospective Payment System.

The fiscal year (FY) 2023 proposed rule included several payment policies and quality reporting proposals of interest to essential hospitals, including three equity measures.

America’s Essential Hospitals called on CMS to codify a clear definition of the category of hospitals that disproportionately serve marginalized patients and implement policies that will protect and support essential hospitals’ critical work.

The association also urged CMS to:

  • increase its proposed annual hospital payment update to account for rapidly rising costs of hospital goods and services;
  • use its authority to maintain stability in total disproportionate share hospital (DSH) payments for essential hospitals, accurately capture the full range of uncompensated care costs hospitals sustain when caring for disadvantaged patients, and ensure transparency in its Medicare DSH methodology;
  • implement policies that reduce administrative burden on hospitals in the Medicare Promoting Interoperability Program;
  • continue to refine the Hospital Inpatient Quality Reporting Program measure set, including providing additional time for hospitals to prepare for new health equity measures before required reporting;
  • work with patients and providers to establish meaningful indicators of high-quality maternal care and share best practices and interventions to mitigate maternal health disparities;
  • promote the standardized reporting of social risk factors, including the use of Z codes, to better understand severity of illness and resources necessary to treat adverse health outcomes caused by social barriers to care;
  • finalize the proposed continuation of the suppression policy for quality measures across quality programs affected by the COVID-19 public health emergency (PHE);
  • adopt policies in the Hospital Readmission Reduction Program (HRRP) that account for the effects—direct and indirect—of COVID-19 on patient outcomes and incorporate social risk factors into the HRRP methodology; and
  • provide clear, interpretive guidance on future data reporting beginning at the end of the COVID-19 PHE, and continue to review the scope of frequency of such reporting and mitigate burdensome requirements.

Additionally, the FY2023 IPPS proposed rule included requests for information (RFIs) related to maternal health, equity, and climate change. On the maternal health RFI, the association asked CMS to:

  • examine factors such as language access, structural racism, mental health, and implicit bias that can potentially influence maternal health outcomes; and
  • consider the role of disease-specific initiatives designed for pregnant and postpartum individuals as part of a larger strategy to advance equity in maternal health outcomes.

The association responded to the RFI on approaches to incorporating equity by calling on CMS to:

  • include in its disparity methods reports social risk factors, beyond dual eligibility and race and ethnicity, to capture the full array of variables that might affect quality of care;
  • continue to report results confidentially to hospitals and refrain from public reporting; and
  • encourage the agency to consider adding hospital characteristics to the confidential reporting of across-hospital disparity method results.

Additionally, the association encouraged CMS to deem essential hospitals as a unique class of facilities for purposes of across-hospital reporting.

Finally, America’s Essential Hospitals urged CMS to support essential hospitals in their efforts to mitigate climate change by:

  • providing upfront and sustainable funding to essential hospitals to meet climate resiliency and mitigation goals; and
  • providing a wide scope of technical assistance to prepare essential hospitals to become more climate-resilient and mitigate their environmental impact.

Contact Director of Policy Rob Nelb, MPH, at or 202.585.0127 with questions.

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