Kimberly Marselas

You’ve surely already heard that your organization should brace for the impact of an adjustment that brings the Patient Driven Payment Model back to budget-neutral status.

Well, it may be time to go ahead and buckle up.

The feds said last month that the shift to the new payment system in October 2019 inadvertently triggered 5%, or $1.7 billion, more spending than was intended, and that the Centers for Medicare and Medicaid Services would have to dial that back one way or another. 

So, dear provider, keep treating all those COVID-19 patients, pay millions more than usual to cover wages and PPE, and, by all means, open the doors for those clinically complex Medicare patients who might help you make up for your state’s Medicaid underpayments. Just remember that sometime in the near future, when you send that invoice in, CMS will be shaving a little off the top.

And lest you think it might be a good long while until you feel the pain, think again.

If you work with managed care (and who doesn’t anymore), chances are pretty good you’re already on a collision course set in motion by the federal government broadcasting future cuts.

“CMS hasn’t kept that quiet, and guess who else has heard that information? That would be all the managed care organizations,” Susie Mix, CEO and President of Mix Solutions Inc., warned last week. “Just when we thought managed care would give us some type of break for just a quick second, they seem to always add some type of insult to injury.”

In this case, they’re already pivoting away from contracts they forged at the advent of PDPM, when they largely agreed to pay skilled nursing providers rates comparable to those in the new model. Now, health plans are taking the CMS “overpayment” indictment and running with it, pushing providers into levels-based contracts that drive reimbursement down to 90% of PDPM rates — in the best cases.

During an April 27 webinar hosted by PrimeCareTech, 42% of attendees said they’d already had to convert at least some contracts from PDPM to levels. Mix said many more providers will experience that kind of pressure in the next six months. She urged providers to make plans, understand the specifics of their contracts and figure out how to maximize them before beginning to admit patients whose coverage could cost unprepared facilities big time.

“Please don’t start on this in three months,” she urged. “This is something you guys need to do now. … They (the plans) are very aggressive in not only cutting our rates 30% to 40%, but they’re also very aggressive in starting this right now.”

Mix, who has been negotiating nursing home contracts with insurers for nearly two decades, said she has never seen “so many health plans on the same page at the same time with a movement.”

So even if CMS honors its word and takes providers’ input into consideration — rolling back its PDPM reimbursement rates over several years, or capping the overall cut with further consideration of COVID-19’s effects — don’t you dare expect managed care to take its sweet time.

Otherwise, Mix warned, you might be holding more of the bill than even CMS could imagine. 

Kimberly Marselas is senior editor of McKnight’s Long-Term Care News.