CMS Reaffirms Expanded Criteria For Inpatient Rehabilitation Facilities
-Criteria Not Inconsistent With GAO Findings-

The Centers for Medicare & Medicaid Services (CMS) issued a notice announcing it will proceed with implementing the revised and expanded classification criteria for inpatient rehabilitation facilities (IRFs) it adopted in a May 7, 2004, final rule.   The rule also provided for a four-year transition period during which the required percentage of patients with a qualifying condition (the “compliance threshold”) increases gradually from 50 percent to 75 percent. 

In January 2005, CMS suspended enforcement of the classification criteria in response to a provision of the Consolidated Appropriations Act, 2005 (“CAA”) that directed CMS not to change the status of certain IRFs for their failure to comply with the classification criteria in the May 7, 2004 rule until it had reviewed recommendations from a then-pending study by the GAO of clinically appropriate IRF classification criteria.  The CAA further directed CMS to either make a determination that its May 7 criteria were “not inconsistent” with the GAO report or to issue an interim final rule revising its classification criteria. 

GAO issued its report and recommendations in April 2005.   GAO recommended that CMS further identify subgroups within the groups specified in the May 7, 2004 final rule.  The subgroups would better identify patients that appear to need an IRF level of care, based upon research and review of IRF cases.  Significantly, GAO did not recommend that CMS delay implementing the revised criteria specified in the May 7 final rule pending further refinement.

The CMS has reviewed the recommendations and determined it has already been taking the steps that the GAO recommended to improve how facilities are classified as an IRF.   In the notice announced today, CMS is issuing its determination that the expanded classification criteria for IRFs are not inconsistent with the recommendations in the GAO report.  CMS realizes that although the existing medical conditions are not designed to identify every patient who should be treated in an IRF, they provide a method upon which to base payments to the IRFs so that they can provide the care that their patients need – plus payments for many patients outside these medical conditions. 

Accordingly, the notice lifts the suspension of enforcement of the criteria in the final rule.  CMS will carefully monitor access to rehabilitation services in all settings as implementation proceeds.

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