The official comment period for a proposed 3.7% nursing home pay hike closed Monday with just 45 comments, a historically paltry number indicating that, unlike previous pay rules, the sector is mostly satisfied with the federal proposal.
In their comments, the American Health Care Association/National Center for Assisted Living, LeadingAge, and other big-name advocacy groups encouraged the Centers for Medicare & Medicaid Services to continue increasing federal payments to skilled nursing facilities.
But they took issue with other aspects of the 2024 SNF PPS proposed rule.
AHCA’s second submission — a nearly 80-page analysis — highlights potential data gaps that could reduce resources available to beneficiaries of federal programs receiving care through skilled nursing facilities. The association referred to a Milliman qualitative review report that found certain factors might not make the proposed PPS rates enough “to adequately adjust for sudden changes (or shocks) within the long-term care community,” the association wrote in its May 26 comment.
“The fact that SNF Medicare cost data are not used for the wage index adjustment could be a significant reason why the PPS methodology has not been able to adapt to significant and sudden changes in the marketplace,” AHCA said.
While CMS punted on attaching an anticipated proposal on minimum staffing requirements to the pay rule in April, LeadingAge noted in its comments that the staffing rule will lead to higher costs.
“Not only will SNFs be responsible for the costs of recruiting additional staff in a scant workforce, but SNFs will also be expending greater financial resources to retain new and existing workers in compliance with staffing standards,” the group wrote in its June 2 submission. “Recognizing that these costs impact the entire nursing home, including SNF residents, consideration of these costs must be included in payment updates moving forward.”
On April 4, CMS announced its proposal to hike Medicare Part A nursing home payments by a net increase of 3.7%, or approximately $1.2 billion, in fiscal year 2024. As McKnight’s Long-Term Care News reported, the agency’s estimate includes a $2 billion increase resulting from a 6.1% net market basket update, which is based on a 2.7% SNF market basket increase plus a 3.6% market basket forecast error adjustment. The rate also reflects a 0.2% productivity adjustment and a cut of $745 million, or about 2.3%, which represents the second phase of a two-year decrease in rates related to recalibration of the Patient Driven Payment Model.
After the implementation of PDPM in October 2019, a CMS analysis found an unintended increase in payments of approximately 5% or $1.7 billion annually. CMS last year finalized a PDPM parity adjustment factor of 4.6% in the FY 2023 SNF PPS final rule with a two-year phase-in period, resulting in a 2.3% reduction for FY 2023 and FY 2024, McKnight’s reported.
Staffing rule cost angst
AHCA wants federal regulators to develop a SNF-specific wage index instead of continuing to use hospital inpatient wage data.
“The SNF PPS does not use the hospital area wage index’s occupational mix adjustment, as this adjustment serves specifically to define the occupational categories more clearly in a hospital setting; moreover, the collection of the occupational wage data under the inpatient prospective payment system (IPPS) also excludes any wage data related to SNFs,” AHCA wrote. “In addition, CMS proposes to continue to use longstanding methodologies to address those geographic areas in which there are no hospitals, and thus, no hospital wage index data on which to base the calculation of the FY 2022 SNF PPS wage index.”
LeadingAge struck out against the agency’s proposal to include the numbers of staff and residents who received the COVID-19 vaccine in the SNF Quality Reporting Program.
“Quality care is not measured by perpetuating the patriarchal ‘Doctor Knows Best’ attitude whereby care and treatment are dictated by the physician, care team, or employer,” the association wrote. “To claim that nursing home quality is measured by how many residents and staff make the choice that CMS wants them to make is a complete disregard of the individual’s choice[,] and CMS’ claim in the proposed rule that ‘SNFS could choose to administer the vaccine to the resident prior to discharge’ seems to indicate that vaccination is a SNF choice, not a resident’s choice.”
The association also criticized a proposal that would make SNFs responsible for sending weekly reports to contractors with 30 fields of data of resident information without an acknowledgement that residents may decline to provide information. The comment noted that facilities that fail to submit at least 75% of data files with a 90% completion rate could lose a piece of their 2% annual payment update.
“While we are concerned with the administrative burden on the SNF for submitting this data on a weekly basis, we are additional concerned with CMS’ seeming lack of regard for the resident’s right to refuse the sharing of his/her information with the contractor,” the group wrote, noting that the proposal neglects to mention resident consent despite the information including personal identifiers and protected health information.
LeadingAge President and CEO Katie Smith Sloan said in a press release issued late Monday that the group also opposes CMS’ value-based purchasing proposal, which combined with the quality reporting, is based on elements outside of providers’ control.
“The proposed payment rule does not address the reality of providers’ operating environments, and will, ultimately, limit older adults’ access to much-needed care and services,” Sloan said. “Nursing homes’ costs will most certainly rise in the coming year. Members will be required to purchase more personal protective equipment and COVID-19 testing supplies to comply with Centers for Disease Control & Prevention (CDC) recommendations; they’ll have to budget funds to ensure compliance with new or enhanced requirements, such as those related to water management programs and emergency preparedness activities.
“These increases are essentially unfunded mandates that our mission-driven, nonprofit providers have no choice but to manage — on top of anticipated cost increases from soon-to-come federal staffing requirements.”
