In February, Congress put an end to the therapy caps in Medicare Part B. Implicit in the legislative intent was the CMS would finally implement a new KSilled Nursing Facility PPS that eliminates therapy services as a payment factor in the near future.
With that little push from Congress and having spent years on research and planning, including the issuance of an Advanced Notice of Proposed Rulemaking last year, CMS seems poised to finally take the leap in the FY 2019 Skilled Nursing Facility Prospective Payment System which cleared White House approval earlier this week.
First and foremost, however, is the payment update. Based on other recently released rules and earlier projections, our estimate for FY 2019 is:
What else to watch:
Proposed new payment system. In last year’s Notice of Advance Proposed Rule Making, CMS outlined a new payment system called the RCS-I case-mix model. In contrast to the current RUG-IV model, which classifies patients into a single RUG, the RCS-I case-mix classification system would classify each resident into four components – PT/OT; Speech Language, NTA and Nursing – and provide a single payment based on these classifications. The payment for each component would be calculated by multiplying the case-mix index for each resident’s group by the component federal base rate and then by the specific day in the per diem schedule.
Impacts identified by CMS as a result of the change include:
- Reduced payments to SNFs overall if not implemented in a budget neutral manner
- Reduction in the amount of therapy services delivered to SNF beneficiaries overall
- Increased payments to beneficiaries with complex clinical needs
- Reduction in payments to beneficiaries receiving high amounts of therapy
Implementation of SNF Value-based Purchasing Program. CMS has been engaged in rolling out the SNF VBP program since the FY 2016 rule so there should be few surprises. The VBP program will be tied to a single all-condition, risk-adjusted potentially preventable hospital readmission measure. A given SNF’s performance as indicated by that measure will affect Medicare payments beginning Oct. 1, 2018.
Use of social risk factors. In last year’s rule, CMS invited comment (as they did in other payment areas) on the use of social risk factors in the SNF VBP program. Social risk factors like dual eligibility, race and income are related to readmission and infections that plague the SNF population. CMS may shed more light on what they plan to do there.
Call with questions anytime. Something tells us we will be spending a beautiful spring weekend reading the Federal Register.
Emily Evans
Managing Director
Health Policy
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