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Final fiscal year 2016 payment and policy changes for Medicare Skilled Nursing Facilities
On July 30, 2015, the Centers for Medicare & Medicaid Services (CMS) issued a final rule [CMS-1622-F] outlining Fiscal Year (FY) 2016 Medicare payment rates for skilled nursing facilities (SNFs). The FY 2016 rates and other issues discussed in the final rule are summarized below.
The final rule promotes policies that continue to shift Medicare payments from volume to value. The Administration has set measurable goals and a timeline to move the Medicare program, and the health care system at large, toward paying providers based on the quality, rather than the quantity of care they give patients. The final rule includes policies that advance that vision and support building a health care system that delivers better care, spends health care dollars more wisely and results in healthier people.
Changes to Payment Rates under the SNF Prospective Payment System (PPS)
Based on final changes contained within this final rule, CMS projects that aggregate payments in FY 2016 to SNFs will increase by $430 million, or 1.2 percent, from payments in FY 2015. This estimated increase is attributable to a 2.3 percent market basket increase, reduced by a 0.6 percentage point forecast error adjustment and further reduced by 0.5 percentage point, in accordance with the multifactor productivity adjustment required by law.
SNF Quality Reporting Program (QRP)
The Improving Medicare Post-Acute Care Transformation Act of 2014 (P.L. 113-185) (IMPACT Act), enacted on October 6, 2014, requires the implementation of a quality reporting program for SNFs and standardized data reporting across four post-acute care settings, including home health agencies, inpatient rehabilitation facilities, skilled nursing facilities and long term care hospitals.
Beginning with FY 2018, SNFs that do not satisfactorily report required quality data to CMS under the SNF QRP will have their market basket percentage updates reduced by two percentage points.
For the FY 2018 SNF QRP and subsequent years, CMS proposed and is finalizing the adoption of three measures addressing three quality domains identified in the IMPACT Act: (1) skin integrity and changes in skin integrity; (2) incidence of major falls; and (3) functional status, cognitive function, and changes in function and cognitive function.
The finalized measures are identified below in the Summary Table of Domains and Finalized Measures for the SNF QRP. CMS intends to propose additional quality measures and resource use measures in future rulemaking.
Summary Table of Domains and Finalized Measures for SNF Quality Reporting Program
Skin Integrity and Changes in Skin Integrity
Process Measure: Application of Percent of Patients or Residents With an Admission and Discharge Functional Assessment and a Care Plan that Addresses Function (NQF#2631) (Endorsed on July 23, 2015; Measure Steward: CMS)
SNF VBP Program
Section 215 of the Protecting Access to Medicare Act of 2014 added new subsections (g) and (h) to section 1888 to the Social Security Act (Act). New subsection 1888(h) authorizes the establishment of a Skilled Nursing Facility Value-Based Purchasing (SNF VBP) Program beginning with FY 2019 under which value-based incentive payments are made to SNFs in a fiscal year based on their performance on an adopted hospital readmission measure for this program.
The rule finalizes adoption of the Skilled Nursing Facility 30-Day All-Cause Readmission Measure, (SNFRM) (NQF #2510), as the all-cause, all-condition readmission measure that will be used in the SNF VBP Program. This measure estimates the risk-standardized rate of all-cause, unplanned, hospital readmissions for SNF Medicare beneficiaries within 30 days of their prior proximal short-stay acute hospital discharge.
The Act also requires CMS to replace this measure with an all-condition, risk-adjusted potentially preventable hospital readmission rate. CMS intends to address this topic in future rulemaking.
Future Policy Considerations
In the proposed rule, CMS sought public comments on numerous issues related to the SNF VBP Program’s policies. CMS intends to propose additional details of the SNF VBP in the FY 2017 SNF PPS proposed rule.
Staffing Data Collection
The Affordable Care Act of 2010 (Pub. L. 111-148, March 23, 2010) added a new section 1128I to the Act to promote greater accountability for LTC facilities (defined as skilled nursing facilities and nursing facilities pursuant to new subsection 1128I(a) of the Act). As added by the Affordable Care Act, subsection 1128I(g) pertains to the submission of staffing data by LTC facilities, and specifies that the Secretary, after consulting with state long-term care ombudsman programs, consumer advocacy groups, provider stakeholder groups, employees and their representatives and other parties the Secretary deems appropriate, shall require a facility to electronically submit to the Secretary direct care staffing information, including information for agency and contract staff, based on payroll and other verifiable and auditable data in a uniform format according to specifications established by the Secretary in consultation with such programs, groups, and parties.
For more information
The final rule is on display at the Federal Register’s Public Inspection Desk at http://www.federalregister.gov/inspection.aspx.
For further information, see http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/SNFPPS/index.html.
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