As anticipated, the Centers for Medicare & Medicaid Services issued its final rule for paying skilled nursing providers on Tuesday. Providers will see an $820 million raise for fiscal 2019, which begins Oct. 1.
That’s a result of the 2.4% market basket update that was spelled out in the Bipartisan Budget Act of 2018. In the previous fiscal year, skilled care saw a 1% boost, spelling $370 million in additional pay.
First proposed in April, the rule aims to shift skilled nursing away from fee-for-service care, toward a system that rewards providers for the value of treatment. Industry experts noted Tuesday that the final rule is largely the same as what officials presented a few months ago.
Also, starting on Oct. 1 2019, CMS plans to start using a new case-mix model, the Patient-Driven Payment Model (PDPM), which focuses on a resident’s condition and care needs, rather than the amount of care provided, to determine reimbursement levels.
PDPM, a switch from last spring’s originally pitched RCS-1, will replace the Resource Utilization Group system, or RUG-IV, used to categorize Part A residents into various payment groups based on their level of need.
Matching up with industry concerns, the PDPM reflects an 80% reduction in the number of payment group combinations compared to RCS-1. Federal regulators estimated that simplifying paperwork requirements for patient assessments would reduce provider costs by $2 billion over 10 years.
Under the new rule, CMS is finalizing changes to the SNF Value-based Purchasing Program. Scoring for methodology for low-volume providers will be updated, as will an extraordinary-exemption policy. In addition, in an effort to increase the veracity of results, the agency will start using two years of data (instead of one) to calculate a pair of measures on Nursing Home Compare.
Brian Ellsworth, director of payment transformation with Health Dimensions Group, told McKnight’s that one notable difference in the final rule is a switch to make the “interim payment assessment” optional for providers. But for the most part, CMS is moving forward with the original rule “as is,” with no intention of hitting the brakes.
“With the finalization of this proposed rule, CMS clearly seems to be sending a signal that we are going to implement PDPM, and if issues arise, we’ll address them and figure things out in future policymaking. This system appears to be a go and it is largely being implemented as proposed for most of the components,” he said.