On April 14, 2008, the Centers for Medicare & Medicaid Services (CMS) issued the fiscal year (FY) 2009 acute care hospital inpatient prospective payment system (IPPS) proposed rule (CMS-1390-P). This proposed rule is scheduled to be published in the April 30, 2008, Federal Register. CMS proposes significant policies regarding hospital quality data reporting, the payment adjustment for hospital-acquired conditions, cost-based payment weights, Medicare-Severity Diagnosis-Related Groups (MS-DRGs), and the hospital wage index adjustment. CMS estimates that the policies proposed will result in an increase in aggregate IPPS payments of nearly $4 billion over estimated payments for FY 2008.

The proposed changes would be effective October 1, 2008. CMS is seeking public comments on its proposals for 60 days. Comments must be submitted no later than June 13, 2008. Below is an analysis of key elements of the FY 2009 IPPS proposed rule.

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