FACT SHEET

FOR IMMEDIATE RELEASE

July 29, 2016

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Final fiscal year 2017 payment and policy changes for Medicare Skilled Nursing Facilities (CMS-1645-F)

Overview

On July 29, 2016, the Centers for Medicare & Medicaid Services (CMS) issued a final rule outlining fiscal year (FY) 2017 Medicare payment policies and rates for the Skilled Nursing Facility Prospective Payment System (SNF PPS), the SNF Quality Reporting Program (SNF QRP), and the SNF Value-Based Purchasing (SNF VBP) Program. The FY 2017 final policies are summarized below.

The policies in the final rule continue to shift Medicare payments from volume to value. The Administration has set measurable goals and a timeline to move the Medicare program, and the health care system at large, toward paying providers based on the quality, rather than the quantity of care they provide to their patients. This final rule includes policies that advance that vision and support building a health care system that delivers better care, spends health care dollars more wisely, and results in healthier people.

Updates to Payment Rates under the SNF Prospective Payment System (PPS)

CMS projects that aggregate payments to SNFs will increase in FY 2017 by $920 million, or 2.4 percent, from payments in FY 2016. This estimated increase is attributable to a 2.7 percent market basket increase reduced by 0.3 percentage points, in accordance with the multifactor productivity adjustment required by law.

Changes to the SNF Quality Reporting Program (QRP)

The Improving Medicare Post-Acute Care Transformation Act of 2014 (the IMPACT Act) added Section 1899B to the Social Security Act that requires SNFs to report data on measures that satisfy measure domains specified in the Act. Section 1899B also requires that these measures be aligned with measures implemented for Long-Term Care Hospitals (LTCHs), Inpatient Rehabilitation Facilities, SNFs, and Home Health Agencies (HHAs). This final rule adopts three measures to meet the resource use and other measure domains and one measure to satisfy the domain of medication reconciliation. SNFs that fail to submit the required quality data to CMS will be subject to a 2 percentage point reduction to the annual market basket percentage update factor for fiscal years beginning with FY 2018.

Finalized Changes:

The quality measures finalized for the FY 2018 payment determination and subsequent years to meet the resource use and other measure domain are as follows:

Medicare Spending Per Beneficiary - Post-Acute Care (PAC) SNF QRP
Discharge to Community – PAC SNF QRP
Potentially Preventable 30-Day Post-Discharge Readmission – SNF QRP.

The quality measure finalized for the FY 2020 payment determination and subsequent years to meet the medication reconciliation domain is:

Drug Regimen Review Conducted with Follow-Up for Identified Issues.Policies and procedures associated with public reporting are also being finalized, including the reporting timelines, preview period, review and correction of assessment-based and claims-based quality measure data, and the provision of confidential feedback reports to SNFs. SNF Value-Based Purchasing (VBP) ProgramSection 215 of the Protecting Access to Medicare Act of 2014 (PAMA) authorizes the establishment of a SNF VBP Program beginning with FY 2019 under which value-based incentive payments are made to SNFs based on performance.Measures: In this final rule, CMS has also finalized additional policies related to the SNF VBP Program including:
Other Policies:
This final rule specifies the SNF 30-Day Potentially Preventable Readmission Measure, (SNFPPR), as the all-cause, all-condition risk-adjusted potentially preventable hospital readmission measure as required by law. The SNFPPR assesses the facility-level risk-standardized rate of unplanned, potentially preventable hospital readmissions for SNF patients within 30 days of discharge from a prior admission to a hospital paid under the Inpatient Prospective Payment System, a critical access hospital, or a psychiatric hospital.
Establishing performance standards;
Establishing baseline and performance periods;
Adopting a performance scoring methodology; and
Providing confidential feedback reports to SNFs.

For More Information

The final rule displayed on July 29, 2016, at the Federal Register’s Public Inspection Desk and will be available under “Special Filings,” at http://www.federalregister.gov/inspection.aspx.

It will publish in the August 5, 2016 Federal Register and become effective on October 1, 2016.

For further information, please see: