CMS proposes $887 million increase for skilled nursing facilities

The Centers for Medicare and Medicaid Services has proposed raising the Medicare payment rates for skilled nursing facilities for a projected 2.5 percent, or $887 million increase, in 2020.

CMS is also implementing a new value-based case-mix model to determine payment. Starting on October 1, CMS will begin using a patient driven payment model that focuses on the patient's condition and resulting care needs, rather than on the amount of care provided.

The proposed rule makes the changes under the skilled nursing facility prospective payment system, the SNF value-based purchasing program and the SNF quality reporting program. 

IMPACT

CMS said it was aligning payment rates for skilled nursing facilities with the costs of providing care and increasing transparency. 

Skilled nursing facilities will be scored based on a measure of potentially preventable hospital readmissions. The facilities are currently scored on an all-cause measure of hospital readmissions.  As required by statute, the program reduces SNFs' Medicare payments by 2 percent, then redistributes 60 percent of those funds as incentive payments.

In FY 2020, the SNF value-based program is changing the name of the program's measure to the "Skilled Nursing Facility Potentially Preventable Readmissions after Hospital Discharge" measure.

The value-based program's scoring and operational policies for 2020 include: updated public reporting requirements for SNFs with less than 25 eligible stays during the baseline or performance period for a program year, and SNFs with zero eligible cases during the performance period; and a 30-day deadline for phase one review and corrections requests.

SNFs that fail to submit the required quality data to CMS will be subject to a 2 percent reduction from the applicable fiscal year's annual market basket percentage update. 

To improve interoperability of health information CMS proposes to adopt two new quality measures on the transfer of health information from the SNF to another provider, and the transfer of health information to the patient.

TREND

The policies continue the shift of Medicare payment from volume to value and improve program interoperability, operational quality and safety, CMS said.

CMS encourages comments, due by June 18.

METHODOLOGY

This estimated increase is attributable to a 3 percent market basket increase factor with a 0.5 percentage point reduction for multifactor productivity adjustment.

The methodology uses prospective, case-mix adjusted per diem payment rates.

To help ensure SNFs have the most up-to-date ICD-10 code information, CMS proposes a sub-regulatory process for making non-substantive changes to the list of ICD-10 codes used to classify patients into clinical categories. 

Under current policy, group therapy is defined as consisting of exactly four patients. Other payment systems define group therapy as including as few as two patients. For more fair and consistent therapy definitions across care settings that align with policy for site neutral payments, CMS is proposing to adopt the definition of group therapy as that of two to six patients doing the same or similar activities.

In addition, CMS proposes to adopt a number of standardized patient assessment data elements that assess either cognitive function and mental status, special services, treatments and interventions, medical conditions and comorbidities, impairments, or social determinants of health (race and ethnicity, preferred language and interpreter services, health literacy, transportation or social isolation).

In response to public input, CMS is proposing to collect standardized patient assessment and other data to calculate quality measures using the minimum data set on all patients, regardless of payer source.
Finally, CMS proposes updates to specifications for the discharge to community measure to exclude baseline nursing home residents.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com