Month / Year

Category: Federal Register

FFY 2024 IPPS Proposed Rule – Hospital-Acquired Conditions (HAC)

On April 10, the Centers for Medicare & Medicaid Services (CMS) published the FFY 2024 IPPS Proposed Rule (effective for discharges on or after October 1, 2023).” Toyon is pleased to provide our summary of:  Topic 11 – FFY 2024 IPPS Proposed Rule – Hospital-Acquired Condition (HAC) Reduction Program

Hospitals in the lowest quartile on select measures of hospital-acquired conditions will receive the one percent payment reduction under the HAC Reduction Program in FFY 2024 (unlike FFY 2023, CMS does not propose to suppress the HAC adjustment in FFY 2024). Also, CMS requests comments on new measurements advancing patient safety and reducing health disparities for consideration in future years, updating the targeting criteria for an Extraordinary Circumstances Exemption (ECE), and implementing a Request for Reconsideration Process for invalidated results. 
For more information, please contact Robert Howey at
Comments are due to CMS by Friday, June 9 via (see instructions under the “submit a comment” tab and reference file code “CMS-1785-P”). Toyon will share our comment letter in the coming weeks. 
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FFY 2024 Inpatient Prospective Payment System Proposed Rule
Webinar: May 9, 2023 – 10 a.m. PDT

Please join Toyon on Tuesday May 9, from 10-11:30 a.m. PDT for our presentation of the FFY 2024 Inpatient Prospective Payment System (IPPS) Proposed Rule. Interested participants can register here for the webinar.

Toyon’s service line leaders will discuss key changes in the Proposed Rule, including:

  • Market Basket and updates to FFY 2024 payment rates
  • Wage Index, with emphasis on changes to “rural floor” indices
  • Disproportionate Share (DSH) funding and allowable 1115 waiver days
  • Request for Information on safety-net hospitals
  • Graduate Medical Education and Allied Health reimbursement

Provider Impact Analysis
Please see Toyon’s estimated Medicare FFY 2024 IPPS payments for your hospital(s) here. Estimates can be rendered by selecting your hospital(s) in the top left of the dashboard under “Provider.” The estimated FFY 2024 payments are compared to FFY 2023 and are broken down by each component of the Medicare rate as provided by CMS.

Please contact Fred Fisher at 888.514.9312 or with any questions or for additional information.

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This Friday June 17th at 5 PM, comments are due on CMS’s proposed FFY 2023 IPPS rate setting.   In commenting – 

  • Refer to file code CMS–1771–P.  
  • Submit electronically through this regulation link then select the COMMENT button at left, below the title; or
  • Submitted by mail to: Centers for Medicare &Medicaid Services, Department of Health and Human Services, Attention: CMS–1771–P, P.O. Box 8013, Baltimore, MD 21244–1850.

Please feel free to see Toyon’s comments here on our website.  Providers may also download a word version of these comments with designated [highlighted] areas to populate for your hospital or health system.  

Toyon’s comments are focused on reimbursement issues, as well as cost reporting proposals requiring additional clarification, as summarized in the table below.

# Issue FFY 2023 Proposal Summarized  Comment

Market Basket

2.7% Update

3.1% Market Basket -0.4% ACA Adjustment

8.0% Update

Based on recent Medicare cost increases[1]

2 Outliers


Fixed Loss Threshold  (40% increase from PY)

Reduce threshold in anticipation of fewer COVID-19 hospitalizations in FFY 2023

UC DSH Factor 1


Reduction to FFY 2023 UC DSH Payments


Reduction to FFY 2023 UC DSH Payments

Increase Factor 1 discharge adjustment considering forecasts of increased Medicare utilization

4 UC DSH Factor 2


-0.03 from prior yr

-0.07 from penultimate yr


-0.03 from prior yr

-0.07 from penultimate yr

Increase Factor 2 to reflect projections of increases to the national uninsured population

5 Empirical DSH Section 1115 Waiver Days Medicaid patients regarded as eligible from 1115 Waiver w/ essential health benefits (EHB) Clarification on premium assistance days “for which the premium assistance is equal to or greater than 90 percent of the cost of the coverage”
6 NP95 Respirator Payments Reimbursement for the incremental cost of using wholly domestically produced N95 respirators Supported and request CMS reimburse for all patients (not only Medicare) in bi-weekly lump sum payments

Please feel free to email Fred Fisher at with any questions.

[1] Analysis of Medicare cost per discharge change from FFY 2019 to FFY 2020 per Medicare cost report data from the Healthcare Cost Report Information System (HCRIS).  Medicare cost per Worksheet D-1 Part II, Line 49, Column 1.  Medicare discharges per Worksheet S-3 Part I L14.00 C13.00.

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