CMS Issues Nursing Home Payment Rule

The Centers for Medicare and Medicaid Services (CMS) proposes to increase Medicare payments to Skilled Nursing Facilities (SNFs) by 2.5 percent and redefine group therapy to consist of two to six patients. These are among the highlights in the proposed Prospective Payment System (PPS) rule that the agency issued on Friday and is scheduled to publish on April 25^th. The rule makes no substantive changes to the Patient-Driven Payment Model (PDPM) reimbursement methodology that is set to replace RUGs in October of this year but does propose to add two quality measures to the SNF Quality Reporting Program (QRP), tweak the specifications for calculating the Discharge to Community measure, and increase the data used for quality measures to include all payer sources.

The proposed rule is the annual vehicle used by CMS to update SNF Medicare rates as well as policies governing the QRP and Value-Based Purchasing (VBP) programs. Comments on the rule will be accepted until June 18^th, with CMS issuing the final rule later this summer. The rule governs rates and initiatives for Federal Fiscal Year (FFY) 2020, which starts on Oct. 1, 2019.

Highlights of the proposed rule include:

A nationwide increase of $887 million for Medicare SNF payments (2.5 percent);
A listing of PDPM base rates for each of the PDPM components for both rural and urban areas;
A change in the definition of group therapy from four residents to two to six residents;
The addition of two health information quality measures:
- Transfer of health information from SNF to another provider;
- Transfer of health information from SNF to the patient;
A shift in how QRP measures are calculated to include Minimum Data Set (MDS) data regardless of payer;
The exclusion of baseline nursing home residents when calculating the Discharge to Community QRP measure;
Changes to public reporting for homes with insufficient volume to calculate their VBP scores; and
Using a sub-regulatory process for updating non-substantive changes to ICD-10 codes.

For most regions, the proposed wage index adjustment is a bit lower than in the current year, with the Glens Falls region seeing the largest drop (-8.6 percent) followed by the Syracuse region (-2.4 percent). The New York City index dips by 1.1 percent while non-urban areas decline by 0.8 percent. The Utica region increases by 3.3 percent.

An inspection version of the rule is available here, and a fact sheet is here. We will be providing members a more detailed analysis of the proposed rule shortly.

Contact: Darius Kirstein, dkirstein@leadingageny.org, 518-867-8841