MedPAC suggests 2-year, incremental transition to new post-acute pay plan

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MedPAC recommended its full unified system be in place by 2021.
MedPAC recommended its full unified system be in place by 2021.

Long-term care providers could see changes to their payment system as early as 2019 under an incremental transition period being considered by the Medicare Payment Advisory Commission.

MedPAC suggested “blending” current payment rates with those under the group's recommended site-neutral post-acute care payment system in a meeting held Thursday. The blended rates would result in increased payment for nonprofit and hospital-based providers, while payments would decrease for for-profit and freestanding providers, Principal Policy Analyst Carol Carter said during a presentation on the process.

MedPAC currently calls for the full unified system to be in place by 2021, but weaving in portions of the system earlier could help correct the current system's biases, increase the equity of payments across conditions, and give providers more time to adjust to the changes required to be successful under the new pay method, commissioners said.

“I think there's actually some experience in implementing post-acute care payment reforms incrementally, going back to the skilled nursing facility prospective payment system,” said Commissioner David Grabowski, Ph.D. “My sense is that was a positive, and I think going here, in that same incremental fashion, could also be a positive, whether that's kind of one-third in 2019 and then two-thirds in 2020 and then the full step in 2021.”

Some raised concerns that the blending process could make skilled nursing providers accustomed to a pay rate that would drop when the full system is implemented, complicating the transition process. Carter disagreed, explaining that the process could get providers thinking about cutting back on the amount of therapy that's not tied to patient characteristics.

“This puts their toe in that water, because it is a baby step towards doing that,” Carter said. “I think the kinds of changes that a provider is going to need to take on … would be the incentives here.”

MedPAC members acknowledged that while the Centers for Medicare & Medicaid Services doesn't have to act on their recommendation, the incremental transition would be “desirable.” The group's next meeting, scheduled for early December, will include further discussion on blending the current and unified payment weights.