Inpatient Rehabilitation Facility (IRF) PPS
How Medicare pays inpatient rehabilitation facilities under the IRF prospective payment system — the case-mix group (CMG) payment, wage and facility adjustments, and high-cost outliers — plus a FY 2026 payment estimator.
Data statusReference Only
- Status
- Reference Only
- Data year / effective
- FY2026
- Last reviewed
- June 2026
- Last updated
- June 2026
- Primary source
- CMS IRF PPS Final Rule, FY2026
- Known exclusions
- Wage index and facility CCRs vary by provider
- Outlier, transfer, and short-stay adjustments are case-specific
- Sequestration and MAC edits not applied
- Validate against the IRF Pricer and your MAC
Published reference for the stated period — confirm the current figure and any corrections at the source before billing.
How an IRF case is paid
FY 2026Each discharge is assigned to a case-mix group (CMG) and tier based on the IRF-PAI assessment. The CMG's relative weight is multiplied by the standard payment conversion factor to build the base payment, which is then adjusted:
| 1. Base | CMG relative weight × conversion factor ($19,371) |
| 2. Wage | labor-related share (74.4%) adjusted by the area wage index |
| 3. Facility | rural (+14.9%), low-income percentage (LIP), and teaching adjustments |
| 4. Case | interrupted-stay, transfer, short-stay and death adjustments |
| 5. Outlier | 80% of estimated cost above (payment + $10,062 threshold) |
IRF Payment Estimator →
Enter a CMG relative weight and wage index to estimate the FY 2026 federal payment, with outlier.
IRF PPS Rates & Method →
The FY 2026 conversion factor, outlier threshold, labor share, CCRs, and the full payment formula.
How a Medicare claim is built →
Bill types, revenue codes, and the UB-04 — background for IRF institutional claims.
