On April 4, 2023, the Centers for Medicare & Medicaid Services (“CMS”) released a proposed rule (“Proposed Rule”) that would update Medicare payment policies and rates for skilled nursing facilities (“SNFs”) under the Skilled Nursing Facility Prospective Payment System (“SNF PPS”) for fiscal year 2024.
The Proposed Rule also proposes changes and additions to the SNF Quality Reporting Program (“SNF QRP”) and the SNF Value-Based Purchasing (“SNF VBP”) Program for fiscal year 2024 and future years. The Proposed Rule would also eliminate the requirement for SNFs to actively waive their right to a hearing in writing and instead treat the failure to submit a timely hearing request as a constructive waiver.
Proposed Changes to Civil Money Penalties
The Proposed Rule proposed changes to Civil Money Penalties (“CMP”) to allow SNFs to receive by default the 35% penalty reduction when the SNF has not appealed within the 60-day timeframe. If finalized, the change to 42 CFR § 488.436(a) would reduce the path SNFs take to resolve and settle these penalties with CMS and the states since SNFs would not need to submit a written waiver of a hearing to appeal deficiencies that resulted in the CMP being imposed.
Proposed Changes to SNF QRP
For fiscal year 2024, CMS proposes an aggregate $1.2 billion increase in Medicare Part A payments to SNFs. CMS sees this as a 3.7% increase, which is based on a 2.7% SNF market basket increase, plus a 3.6% market basket forecast error adjustment and less a 0.2% productivity adjustment.
The SNF QRP is a pay-for-reporting program. SNFs that do not meet reporting requirements are subject to a two-percentage-point reduction in their Annual Payment Update. In the Proposed Rule, CMS is proposing the adoption of three measures in the SNF QRP and the removal of three measures from the SNF QRP.
The Proposed Rule proposes the creation of:
- Discharge Function Score (known as the “DC Function”) measure beginning with the fiscal year 2025. This measure assesses functional status by assessing the percentage of SNF residents who meet or exceed an expected discharge function score and uses mobility and self-care items already collected on the Minimum Data Set (“MDS”).
- CMS is proposing the adoption of the CoreQ: Short Stay Discharge (known as the “CoreQ: SS DC”) measure beginning with the fiscal year 2026. This measure calculates the percentage of individuals discharged from an SNF, within 100 days of admission who are satisfied with their SNF stay.
- CMS is also proposing the adoption of the COVID Vaccine: Percent of Patients/Residents Who Are Up to Date (known as the “Patient/Resident COVID-19 Vaccine”) measure beginning with the fiscal year 2026. This measure reports the percentage of stays in which residents in an SNF are up to date with recommended COVID vaccinations in accordance with the Centers for Disease Control and Prevention’s most recent guidance.
CMS is proposing to increase the SNF QRP data completion thresholds for the MDS Data Items beginning with the fiscal year 2026. CMS proposes SNFs must report 100% of the required quality measure data and standardized resident assessment data collected using the MDS on at least 90% of the assessments they submit to CMS. Any SNF that does not meet the proposed requirement that 90% of all MDS assessments submitted contain 100% of required data items will be subject to a reduction of 2 percentage points to the applicable fiscal year.
Proposed Changes to the SNF VBP Program
The SNF VBP rewards SNFs with incentive payments based on the quality of care they provide. All SNFs paid under Medicare’s SNF PPS are included in the SNF VBP. In the Proposed Rule, CMS is proposing the adoption of four new quality measures.
The Proposed Rule proposes the creation of:
- The Long Stay Hospitalization Measure per 100 residents beginning with the fiscal year 2027 program year and fiscal year 2025 performance year. This measure assesses the hospitalization rate of long-stay residents.
- The Percent of Residents Experiencing One or More Falls with Major Injury (Long Stay) beginning with the fiscal year 2027 program year and fiscal year 2025 performance year. This measure assesses the falls with major injury rates of long-stay residents.
- The Nursing Staff Turnover Measure for the SNF VBP program beginning with the fiscal year 2026 program year and fiscal year 2024 performance year.
- The Discharge Function Score measure beginning with the fiscal year 2027 program year and fiscal year 2025 performance year.
Providing Comments/Practical Takeaway
SNFs subject to the SNF QRP and SNF VBP rules should review the Proposed Rule’s changes to determine the potential impact on their operation and determine whether to submit a comment to support, question, clarify or challenge an of the proposed changes. Comments are due by 11:59 PM ET on June 5, 2023 and should be identified by CMS–1779–P and submitted via the Federal eRulemaking Portal, regular, express or overnight mail, hand delivery or courier to the addresses and following the instructions based on the delivery type provided in the Proposed Rule.
If you have any questions, would like assistance preparing public comments or would like additional information about this topic, please contact:
- Sean Fahey at (317) 977-1472 or sfahey@hallrender.com; or
- Your regular Hall Render attorney.
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