A recalibration of the Patient Driven Payment Model’s parity adjustment has several long-term care operators worried about potential steep cuts to skilled nursing reimbursements. But executives with The Ensign Group believe such a move could be beneficial to the company on the acquisition front. 

The company touted another quarter of “record results” during a first-quarter earnings call Friday. Officials reported that adjusted net income for the quarter was $49.6 million, an increase of 15.5% over the prior year.

The Centers for Medicare & Medicaid Services is currently taking comments on possible PDPM recalibrations after an in-house analysis found aggregate SNF spending under the new model unintentionally increased payments by $1.7 billion, or 5%. The agency is specifically seeking feedback from providers on whether it should delay or phase in an adjustment once an appropriate methodology for recalibrating the PDPM parity adjustment is determined.

Ensign CEO Barry Port explained during the call that, “If it all happened at once, it would be bad for everyone in the very short term, but most importantly, for the poorly capitalized companies that just are hanging on by a thread right now.” 

“For us, it would most undoubtedly create a pretty large buying opportunity, which wouldn’t be a horrible thing for us to see,” he added. 

He noted that “most [operators] would prefer that it’s spread out over time. That there’s a long enough runway to have before that would go into effect.” 

Port said Ensign submitted its thoughts on the matter to CMS late last week. He said the company’s biggest concern currently is what data the agency will use to determine the recalibration.

“First and foremost, we feel that there’s some deficiencies in the analysis that was done as it relates to budget neutrality just given the nature of the pandemic, the complexity of the patients. We lined out those details in our response,” Port said. 

“Second, [there’s also] the question of timing. We’re not as concerned about that, ultimately, as we are of making sure that the analysis is done right,” he added.