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2020 Inpatient Acute (IPPS) Final Rule Update: Standardized Rates

Posted by Stacie Snider on Oct 24, 2019 4:41:25 PM

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update-1672363_1920_Image by Gerd Altmann from Pixabay We are now in the midst of Federal fiscal year (FFY) 2020 which began at the start of this month. A new Federal fiscal year brings with it new standardized rates that affect hospital discharges on or after October 1, 2019. Each year, CMS publishes updates to the regulations for inflation factors, wage adjustments, etc., which for the current FFY, can be found in the 2020 Inpatient Acute (IPPS) final rule on the CMS website. It is important to note that CMS published a correction notice on October 8, 2019, in which standardized rate values were revised and now differ from what was published in the August version of the final rule.


The rates that are detailed in this post are the non-wage index adjusted rates for specific Core-Based Statistical Areas (CBSAs) as well as additional standardized rate updates. If hospitals have not loaded these revised values (based on the October correction notice update) into their systems, they will need to load the updated rates into their patient accounting systems used to bill Medicare (i.e. EPIC, etc.). The tables that follow include the newly revised CMS Federal fiscal year 2020 rates along with the calculation change from the 2019 rates:


2020 Medicare standardized rates table 1a - wage index greater than 1



2020 Medicare standardized rates table 1B - wage index less than or equal to 1 

 2020 Medicare standardized rates table 1C - Puerto Rico


2020 Medicare standardized rates table 1D - Capital

 2020 Medicare standardized rates table 1E LTCH PPS


In addition to the rates above, there are a couple of other notable items from our review of the IPPS final rule related to rates:

  1. CMS finalized their change for the way wage index is calculated. 

  2. CMS updated the quality program for IPPS.

  3. CMS updated the New Technology Payment Add-ons. Additional rate updates include:

Blog - standardized rates other rates - FINAL 2020 CN REVISED outlier only 26552
In conclusion, hospitals need to review whether the appropriate rates have been loaded into their patient accounting system used to bill Medicare. Once these revised rates are incorporated, best practice would be to validate that the rates are calculating appropriately. This can be accomplished by pulling a paid claim and running it through the pricer for IPPS that can be downloaded from the CMS website. Should you have any questions on the revised rates or during the course of your validation review, please don’t hesitate to leave a comment below or reach out to SCA.


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Topics: Industry Updates, regulations, final rule, ipps rule, provider reimbursement

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