Skilled Nursing Payment Changes Recommended.
CMS is recommending nursing payment changes. The Medicare Payment Advisory Commission (MedPac) is recommending changes to the federal fiscal year prospective payment system (PPS) for skilled nursing facilities (SNF’s).
MedPac members during its December meeting recommended the suspension of PPS updates for 2018 and 2019, as well as recommending a revision in the existing PPS. The members requested that the Department of Health and Human Services secretary revise the prospective payment system for skilled nursing facilities so that the new system would more closely align itself with real costs associated with providing necessary care.
In addition the members acknowledged that there was an increase in skilled nursing facility admissions in 2013, reflecting a 3.2 percent increase . They also noted that the average length of stay (LOS) declined by for percent (4%) between 2013 and 2015. MedPac staff suggested that the Accountable Care Organizations, bundling, and Medicare Advantage plans (MA) as possible contributing factors in the reduction of lengths of stay (LOS).
The existing PPS methodology continues to be biased towards therapy delivered. not patient characteristics. in addition the methodology does not adequately take into account monotherapy ancillary services (such as MA, medications, and high cost equipment).
In 2015 the reported profit margin was reported to be 12.6 percent for Medicare and above 10 percent for the 16th straight year. MedPac noted that nonprofit margins are lower a 4.4 percent, while for profit facilities maintain a 15 percent margin. MedPac attributed the higher use of therapy and fewer medically complex days as the rationale for higher margins under PPS.
MedPac develops this report annually for Congress. Neither Congress nor the Centers for Medicare or Medicaid is required to act upon any MedPac recommendations.