Fact Sheets

Fiscal Year (FY) 2022 Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) Final Rule (CMS-1748-F)

On July 29, 2021, the Centers for Medicare & Medicaid Services (CMS) issued a final rule that will update Medicare payment policies and rates for facilities under the Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) and finalize policies under the IRF Quality Reporting Program (QRP) for fiscal year (FY) 2022. CMS is publishing this final rule consistent with the legal requirements to update Medicare payment policies for IRFs on an annual basis. FY 2022 IRF PPS payment rates and policies will be effective on October 1, 2021.

In addition, CMS is finalizing a Medicare Durable Medical Equipment Prosthetics, Orthotics, and Supplies (DMEPOS) payment provision adopted in an interim final rule with comment period (IFC) issued on May 11, 2018, as well as a provision that was included in a DMEPOS proposed rule published in the Federal Register on November 4, 2020.

This fact sheet discusses the provisions of the final rule.

Updates to IRF Payment Rates:

For FY 2022, CMS is updating the IRF PPS payment rates by 1.9% based on the IRF specific market basket estimate of 2.6%, less a 0.7 percentage point productivity adjustment. In addition, the final rule contains an adjustment to the outlier threshold to maintain outlier payments at 3.0% of total payments. This adjustment will result in a 0.4 percentage point decrease in outlier payments. We estimate that the overall IRF payments for FY 2022 would increase 1.5% (or $130 million), relative to payments in FY 2021. 

Inpatient Rehabilitation Facility Quality Reporting Program (IRF QRP) Final Rule Updates:

The IRF QRP is a pay-for-reporting program. IRFs that do not meet reporting requirements are subject to a two-percentage point (2.0%) reduction in their annual increase factor. CMS is adopting one measure and finalizing its proposal to update the specifications for another measure. In addition, CMS is finalizing its proposal to modify the number of quarters used for public reporting of IRF quality measures due to the public health emergency and sought comments for two Requests for Information (RFI).

Closing the Health Equity Gap - RFI

Consistent with Executive Order 13985 on Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, CMS is committed to addressing the significant and persistent inequities in health outcomes in the United States through improving data collection to better measure and analyze disparities across programs and policies. CMS is working to make health care quality more transparent to consumers and providers, enabling them to make better choices as well as promoting provider accountability around health equity. CMS’s ongoing commitment to closing the health equity gap in IRFs has been demonstrated by the adoption of standardized patient assessment data elements, which include several social determinants of health (SDOH) that were finalized in the FY 2020 IRF PPS final rule for the IRF QRP (84 FR 39149 through 39161).

CMS sought feedback in this RFI on ways to attain health equity for all patients through policy solutions. We will take all comments received into consideration as we continue work to address and develop policies on this important topic. It is our hope to provide additional stratified quality measure information to providers related to race and ethnicity if feasible. The provision of stratified measure results will allow IRFs to understand how they are performing with respect to certain patient risk groups and to support these providers in their efforts to ensure equity.

COVID-19 Vaccination Coverage Among Healthcare Personnel (HCP) Measure

In the ongoing efforts to address the COVID-19 public health emergency (PHE), CMS is finalizing the adoption of the COVID-19 Vaccination Coverage among HCP Measure. This measure is designed to help assess whether IRFs are taking steps to limit the spread of COVID-19 among their HCP, reduce the risk of transmission within their facilities, and help sustain the ability of IRFs to continue serving their communities through the PHE and beyond. Public reporting of the COVID-19 Vaccination Coverage among HCP measure will begin with the September 2022 Care Compare refresh or as soon as technically feasible based on data collected for Q4 2021 (October 1, 2021 through December 31, 2021).

Transfer of Health (TOH) Information to the Patient-Post Acute Care (PAC) Quality Measure

CMS is finalizing updates to the denominator for the TOH Information to the PAC quality measure. Currently, the measure denominators for both the TOH Information to the Patient-PAC and to the Provider-PAC quality measures include patients discharged home under the care of an organized home health service organization or hospice. In order to avoid counting these patients in both TOH measures, CMS is removing this location from the definition of the denominator for the TOH Information to the Patient-PAC measure.

Public Reporting of Quality Measures with Fewer than Standard Numbers of Quarters Due to COVID-19 PHE Exemptions.

In March 2020, and in response to the COVID-19 PHE, CMS granted an exception to the IRF QRP requirements for calendar year Q1 2020 (January 1, 2020-March 31, 2020) and Q2 2020 (April 1, 2020-June 30, 2020). CMS also stated that any IRF QRP data that might be significantly impacted in terms of measure reportability and reliability by these exceptions would not be publicly reported for Q1 and Q2 of 2020 due to the absence of useable data these exceptions created. CMS is finalizing its proposal to update the number of quarters used for public reporting to account for this exception.

For the excepted refreshes to the Care Compare website affected by the quarters, CMS will calculate IRF QRP measures using three quarters (Q3 2020 through Q1 2021) of data for assessment-based measures, and six quarters for claims-based measures. CMS will use this methodology for the following affected refreshes: for the assessment-based measures, the affected refresh is the December 2021 refresh; for claims-based measures, the affected refreshes occur from December 2021 through June 2023, where the data will be updated in the December 2021 refresh (Q4 2018 through Q4 2019 and Q3 2020) and the September 2022 refresh (Q4 2019 and Q3 2020 through Q3 2021). For the earlier three affected refreshes (March, June, and September 2021), CMS will hold constant the Care Compare website with December 2020 data.

Fast Healthcare Interoperability Resources (FHIR) in Support of Digital Quality Measurement in Post-Acute Care Quality Reporting Programs - RFI

CMS is working to further its mission to improve the quality of health care for beneficiaries through measurement, transparency, and public reporting of data. The IRF QRP and CMS’s other quality programs are foundational for contributing to improvements in health care, enhancing patient outcomes, and informing consumer choice. CMS believes that advancing our work with use of the FHIR standard offers the potential for supporting quality improvements and reporting, which will improve care for our beneficiaries. CMS sought feedback in this RFI on our future plans to define digital quality measures (dQMs) for the IRF QRP. CMS also sought feedback on the potential use of FHIR for dQMs within the IRF QRP, aligning where possible with other quality programs. We received a number of comments which we will consider as we develop future policies in this space. Further, we plan to continue working with other agencies and stakeholders to coordinate and to inform our transformation to dQMs leveraging health IT standards.

Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Policy Issues:

Exclusion from Fee Schedule Adjustments for Accessories (Including Seating Systems) and Seat and Back Cushions Furnished in Connection with Group 3 or Higher Complex Rehabilitative Power Wheelchairs and Complex Rehabilitative Manual Wheelchairs

CMS is finalizing an exclusion from fee schedule adjustments based on information from the DMEPOS Competitive Bidding Program (CBP) for wheelchair accessories (including seating systems) and seat and back cushions furnished in connection with group 3 or higher complex rehabilitative power wheelchairs. We are also extending this fee schedule adjustment exclusion to wheelchair accessories (including seating systems) and seat and back cushions furnished in connection with complex rehabilitative manual wheelchairs. Additionally, we are modifying the regulatory definition of “item” under the DMEPOS CBP at 42 CFR 414.402 to exclude complex rehabilitative manual wheelchairs and certain other manual wheelchairs and related accessories when furnished in connection with these wheelchairs from the DMEPOS CBP, as required by section 106(a) of the 2020 Further Consolidated Appropriations Act.

The final rule (CMS-1748-F) can be downloaded from the Federal Register at: 

For further information, see the IRF center webpage: