FY 2022 IPPS Proposed Rule
May 7, 2021
On April 27, The Center for Medicare & Medicaid Services (CMS) introduced a proposal for graduate medical education (GME) as part of the FY 2022 Inpatient Prospective Payment System (IPPS) proposed rule. These policies will bring additional residency slots, changes to accreditation for Rural Training Tracks (RTTs), and opportunities for low Per Resident Amounts (PRA’s) to be reset. Proposed changes are summarized below:
Additional 1,000 funded Medicare GME Slots
Beginning in FY 2023, 200 slots will be distributed each year over five years, totaling 1,000 available slots. Hospitals are eligible for 1.0 Full-Time Equivalent (FTE) per year. There are two proposed criteria for distributing slots. First, hospitals with the highest Health Professional Shortage Area (HPSA) will receive priority. CMS’s alternative method, using four categories of criteria, would be applicable during the first year of the 5-year distribution plan and hospitals qualifying for more categories will receive priority.
The first category Hospitals, qualify if it is located in a rural area or if its main campus is located in an area outside of an urban CBSA. The second category, hospitals exceeding their current GME/IME cap, will need to submit cost reports to show that they are training more residents than their number of funded Medicare cap slots. Third, hospitals in states with new medical schools, additional locations, or branch campuses qualify if they were established on or after January 1, 2000. Lastly, hospitals that serve HPSA’s will qualify and may use slots for any residency program if its main campus or provider-based facility is physically located in a primary care geographic HPSA. Hospitals only in a mental health-only geographic HPSA can only apply for additional psychiatry slots. Furthermore, hospitals would need to show proof that 50% of resident training time in each program they are applying for will be spent at locations within the HPSA.
Applications for new slots are due by January 31 of the preceding fiscal year. For eligibility for FY 2023, applications must be submitted by January 31, 2022. Due to high demand, Hospitals are limited to one application per year, and may not apply for more than a 1.0 FTE cap increase per year. In addition to the application, documentation of a hospital’s plan to create new or expand existing residency programs is required.
Modifications to Rural Training Tracks Requirements
The removal of the “separately accredited” requirement provides flexibility for rural and urban hospitals to partner with any accredited training program. Additional RTT cap adjustments will be available for urban hospitals with existing RTT caps. This adjustment applies to any subsequent RTT program the hospital begins and rural hospitals associated with these programs will also receive an RTT cap increase. This cap increase applies to new rural partnerships formed with an existing RTT program at an urban hospital. During the five-year cap building window participating residents will be excluded from the 3-year rolling average.
Resetting Low Per Resident Amounts
CMS will permit hospitals to reset caps for both direct and indirect GME programs during a 5-year window starting at the first cost report period beginning on or after December 27, 2020, and ending before December 26, 2025.
Hospitals with GME caps established with fewer than 1.0 FTEs from residency training programs before October 1, 1997, are permitted to reset their PRAs and/or caps under existing cap-building processes for new teach hospitals.
Hospitals with GME caps established with fewer than 3.0 FTEs from residency training programs periods between October 1, 1997, to the date of enactment of the CAA are permitted to reset their PRAs and/or caps under existing cap-building processes for new teaching hospitals.
Moving forward, hospitals must train more than one 1.0 FTE resident in a fiscal year before establishing an FTE cap and PRA. The first cost reporting period beginning on or after December 27, 2020, and before December 26, 2025, will be used to reset the FTE cap and PRA for hospitals.
Comments are open for submissions through June 28, 2021. Following is a link to CMS’s official announcement: https://public-inspection.federalregister.gov/2021-08888.pdf