Mark Parkinson

Skilled nursing operators stand to reap their biggest Medicare raise in recent memory under a 3.0% market basket update proposed by the Centers for Medicare & Medicaid Services late Friday afternoon.

With a 0.5 percentage point adjustment for administrative purposes, the net 2.5% raise could elevate the gross haul near $890 million industry wide.

Mark Parkinson, the president and CEO of the American Health Care Association, praised the proposal in a statement.

“The 2.5 percent market basket increase is critical for multiple reasons,” he explained. “We are transitioning to a new payment system, and the sector is on the financial brink. MedPAC just reported that our all-in margin is only 0.5 percent, and many skilled nursing providers are facing devastating closures, particularly in rural areas.

“This increase doesn’t solve these problems, but it gets us headed in the right direction,” he added, thanking CMS Administrator Seema Verma and the administration directly.

Parkinson had expressed confidence that a healthy market basket update could be coming two weeks ago. But he estimated only a 2.2% or 2.3% adjustment when he was a keynote speaker at the annual AANAC/AADNS convention in Orlando.

The market basket update is set by the CMS Office of the Actuary and is considered an inflationary pay adjustment that helps providers keep up with the rising prices for delivering care.

CMS will be accepting comments on the proposed payment rule until June 18. The full proposal can be downloaded from the Federal Register.

Also on Friday, CMS proposed changes to the industry’s value-based purchasing program, and nursing homes’ quality reporting program, casing an eye toward improving the assessment of health information sharing up and down stream.