United States

Senior Living Health Care Connection: Proposed final rule for SNFs


The Centers for Medicare and Medicaid Services (CMS) published the proposed final rule for fiscal year 2018 for skilled nursing facilities (SNFs). SNFs will see an increase of 1 percent or approximately $390 million to the SNF prospective payment system (PPS) federal payment rates. This increase is based on the market basket calculations after the application of certain productivity adjustments.

The proposed rule states that beginning in fiscal 2018 (starting Oct. 1, 2017) SNFs that fail to submit data on the SNF quality reporting measures will see a 2 percentage point reduction to the SNF market basket percentage change for that fiscal year. As stated in the proposed final rule, SNFs will receive a 2 percent reduction to their market basket update in the SNF prospective payment system (PPS) for fiscal 2018 and subsequent years if 80 percent of all Minimum Data Set (MDS) assessments submitted do not contain 100 percent of all the data items necessary to calculate the SNF quality reporting program (QRP) quality measures. For fiscal 2018, that would mean a market basket change of less than zero resulting in lower payments for fiscal 2018 than for fiscal 2017. SNF quality reporting measures currently adopted include:

  • Application of percent of residents experiencing one or more falls with major injury
  • Application of percent of long-term care hospital patients with an admission and discharge functional assessment and a care plan that addresses function-related to Section GG on the MDS
  • Percent of residents or patients with pressure ulcers that are new or worsened

Facilities have been cautioned that these items should be completed. In addition, facilities are reminded that the use of dashes when completing the MDS should be avoided.

Reporting deadline extended

The original reporting deadline of May 15, 2017 to meet the requirements for the SNF QRP fiscal 2018 has been extended to June 1, 2017. CMS distributed the following notice:

Due to extenuating circumstances, CMS is extending the submission deadline for the SNF quality reporting program from May 15, 2017 to June 1, 2017. All data must be submitted no later than 11:59 p.m. Pacific Standard Time on June 1, 2017.

The direction of CMS that focuses on quality care versus quantity can be seen with the implementation of the SNF value-based purchasing program (VBP) which may cut Part A payment rates up to 2 percent based on the national ranking on the SNF’s rehospitalization score. CMS will calculate an “achievement” score and an “improvement” score to determine the SNF payment. The achievement score will be based on calendar year 2017. CMS proposes to publish this performance data on Nursing Home Compare in October 2017. Additionally the proposed rule contains modifications to the SNF QRP measures and additional measures will be included that will affect SNFs in 2019 and 2020.

Administrative presumption will remain for residents who qualify into the top 52 resource utilization group (RUG) categories and those residents will be automatically classified as meeting the SNF level of care requirements. This presumption covers those days up to and including the assessment reference date on the five-day assessment. The proposed SNF final rule will change the wording of this presumption to more accurately reflect the coverage language. The 128 percent add on for AIDS will also remain in effect.

More changes

Providers should be aware of an advance notice of a CMS proposal to consider change to the current PPS payment methodology. CMS is considering changing from the resource utilization groups, version 4 to a new resident classification system, Version I. We will review this change in an upcoming issue of Senior Living Health Care Connection. 

For more information, contact Joan McCarthy at +1 312 634 3479.

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