United States

Senior Living Health Care Connection: Value-based purchasing update


The skilled nursing facility value-based purchasing (SNF VBP) program started fiscal year 2018 (Oct. 1, 2017). Since October 2016, SNFs have been receiving quarterly reports regarding their performance on the readmission measures (RMs) specified in the SNF VBP program through the quality improvement and evaluation system. Two measures are used to calculate possible payment rate changes:

  1. SNF 30-day all-cause RM estimates risk standardized rate of all causes and unplanned hospital readmissions of Medicare fee-for-service (FFS) SNF beneficiaries within 30 days of their proximal hospital discharge with some specific exclusions. Patients must have an SNF admission within one day of discharge from the hospital and the event had to occur within the 12-month target period. The readmission may end the SNF stay, or it may occur after the patient is discharged from the SNF.

  2. SNF 30-day potentially preventable RM assesses the risk-standardized rate of unplanned, potentially preventable readmissions for Medicare FFS SNF patients within 30 days of discharge from a prior proximal hospitalization. The readmission may end the SNF stay, or it may occur after the patient is discharged from the SNF. This measure will replace the SNF RM as soon as practicable.

Program payment dates and periods include the following:

Program fiscal year 2019 (Oct. 1, 2018)

  • Performance period calendar year 2017 (Jan. 1, 2017–Dec. 31, 2017)

  • Baseline period calendar year 2015 (Jan. 1, 2015–Dec. 31, 2015) 

Program fiscal year 2020 (0ct. 1, 2019)

  • Performance period fiscal year 2018 (Oct.1, 2017–Sept. 30, 2018)

  • Baseline period fiscal year 2016 (Oct. 1, 2015–Sept. 30, 2016)

  • Oct. 1 fiscal year 2020 – Performance period begins (Oct. 1, 2019)

  • Dec. 31 fiscal year 2019 – Performance period ends (Dec. 31, 2019)

  • March 31, 2018 – Phase one review and corrections period ends

  • Aug. 1–Aug. 31, 2018 – Phase two review and corrections period ends

  • Oct. 1, 2018 – Incentive payments begin; SNF opportunity to receive incentive payments based on performance

Points for each SNF are awarded using two scores:

  1. Achievement score points awarded by comparing facility’s rate during calendar year (CY) 2017 with all facilities during baseline period of CY 2015

  2. Improvement score points awarded by comparing facility’s rate during performance period CY 2017 with its previous performance during baseline period CY 2015

SNF payments will be reduced by two percentage points starting Oct. 1, 2018. Paybacks to the highest performing SNFs will be 60 percent of the amount withheld from the SNFs.

Questions? Contact Joan McCarthy at +1 312 634 3479.

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