Skilled nursing facilities would see a 5% cut in base pay in 2023, while physicians and physical therapists who support them would see their rates continue to be frozen, if Congress were to adopt draft recommendations proposed by the Medicare Payment Advisory Commission Thursday.
SNF spending would decline $2 billion next fiscal year, for a total of $10 billion in federal savings over the next five years.
In making the expected recommendation for a 5% SNF cut, MedPac noted that Medicare margins had increased for 2022 to 16.5% without accounting for added federal coronavirus relief. With the relief incorporated, margins hit 19.2%. Panel s]taff said the median margin for SNFs operating “relatively” efficiently was 22.8%.
In their presentation, MedPAC staff acknowledged that the “unique circumstances” of the public health emergency confounded their ability to measure and assess quality.
Operators have argued for years that positive Medicare margins are necessary to balance out Medicaid payment rates that in many states don’t cover the cost of patient care.
“There was discussion prior to this vote about the terrible effects of the pandemic on long-term care right now,” noted Cynthia Morton, executive vice president for NASL in remarks to McKnight’s Long-Term Care News Thursday. “MedPAC voted anyway to reduce base pay by 5%. We have a shortage of clinicians in our facilities right now. It’s not the time for Congress to remove resources that our sector can use to recruit and retain. If Congress were to act on this, it would really debilitate the sector.”
MedPAC used similar arguments for their proposals to trim SNF base pay and freezing physician pay rates:They said Medicare payments to clinicians declined by $9 billion in 2020, but clinicians received tens of billions of dollars in relief funds; Medicare payments per beneficiary decreased during 2020, then rebounded; and the number of clinicians was stable.
“This is hardly the case for the post-acute care sector,” Morton said. “For example, therapy companies that provide therapists to nursing facilities were not eligible for provider relief funds. Workforce is everything right now and we don’t have enough therapists to cover all the services needed by those in facilities.”