Wednesday, August 1, 2018

CMS issues Final SNF Payment Rule

Drew Thies


The Centers for Medicare & Medicaid Services (CMS)  finalized the Fiscal Year (FY) 2019 Medicare payment rule for the Skilled Nursing Facility (SNF) Prospective Payment System (PPS). The rule establishes a market basket increase of 2.4 percent, a figure statutorily mandated by Congress, and will start October 1, 2018.

CMS anticipates aggregate payments to SNFs will increase by $820 million from payments in in the previous Fiscal Year. This is $30 million less than in the proposed payment rule issued previously this year. AHCA has begun work to identify errors and opened dialogue with CMS. 

Additionally, CMS finalized a payment system called the Patient-Driven Payment Model (PDPM) to replace the current PPS. The PDPM is an updated version of a proposed change to the payment system announced in 2017. The implementation date for the final system is October 1, 2019 and will be done in a budget neutral manner.

PDPM is composed of five case-mix-adjusted payment components: Physical Therapy (PT), Occupational Therapy (OT), Speech Language Pathology (SLP), Nursing, and Non-Therapy Ancillaries Services (NTAS). Reimbursement would be based on the sum of the five component rates. The model also limits the use of group and concurrent therapy to 25% of all therapy given.

Mark Parkinson, President and CEO at the American Health Care Association (AHCA), said in a statement that while the 2.4% increase is necessary for struggling providers, the therapy limits were reason for concern.

“The therapy language in the rule criticizes skilled nursing providers for providing therapy when CMS has promulgated rules over the last 20 years that encourage therapy,” the statement said. “[T]his rule micromanages patient care and therapy minutes at a time when providers are already overburdened by unnecessary regulation.”

Both the final rule and a fact sheet are available online. The FY19 SNF PPS wage index will be posted in the coming weeks.


AHCA is offering  PDPM-intensive sessions at our AHCA/NCAL Convention & Expo in San Diego take place on Sunday, October 7 and Wednesday, October 10th, more information can be found here.

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