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SNF PPS Payment Model Research

Analysis of Medicare Part A SNF PPS Payment Model

In an effort to establish a comprehensive approach to Medicare Part A SNF payment reform, we are expanding the scope of the SNF Therapy Payment Research project.  Although we always intended to ensure that any revisions to therapy payment would consider an integrated approach with the remaining payment methodology, we now plan to examine potential improvements and refinements to the overall SNF PPS payment system. This expansion will allow for improving the ability for Medicare to pay adequately and appropriately for all services provided during a Medicare Part A SNF stay.  

Overview

Since 1998, Medicare has paid for services provided by skilled nursing facilities (SNFs) under the Medicare Part A benefit on a per diem basis through the skilled nursing facility prospective payment system (SNF PPS). Currently, therapy payments under the SNF PPS are based primarily on the amount of therapy provided to a patient, regardless of the specific patient characteristics and care needs. CMS has contracted with Acumen, LLC to identify potential alternatives to the existing methodology used to pay for services under the SNF PPS. Below, we will post information about this project as it progresses.
 

Phase One

In the first phase of the project, the contractor reviewed past research studies and policy issues related to SNF PPS therapy payment and options for improving or replacing the current system of paying for SNF therapy services. The following report summarizes the analysis and findings from this first phase of the project:

SNF Therapy Payment Models – Base Year Final Summary Report, April 2014

Phase Two

In the second phase of the project, which is now in process, the contractor is using the findings from this Base Year Final Summary Report as a guide to identify potential models suitable for further analysis.  We have considered stakeholder comments and concerns as we continue to investigate alternative therapy payment approaches and plan to solicit additional feedback on this aspect of our SNF payment research.  As noted above, we expanded the scope of this project during this phase to include ideas for revising the overall SNF PPS and plan to include additional and separate opportunities to obtain stakeholder input on non-therapy related refinement possibilities.  

As the contractor began the process of further narrowing the scope of therapy payment models in this second phase of the project, Acumen hosted a Technical Expert Panel in February 2015 to discuss questions and issues related to the therapy payment research. The slides used during this TEP, as well as a report that summarizes the discussion and recommendations of the Technical Expert Panel, may be found below:

Skilled Nursing Facility Therapy Payment Models Technical Expert Panel Presentation

Skilled Nursing Facility Therapy Payment Models Technical Expert Panel Summary

Additionally, Acumen hosted a second Technical Expert Panel in November 2015 to discuss questions and issues related to the nursing component of the SNF PPS, as well as issues around Non-Therapy Ancillaries. The slides used during this TEP, as well as a report that summarizes the discussion and recommendations of the Technical Expert Panel, may be found below:

Skilled Nursing Facility Payment Models Nursing Component Technical Expert Panel Presentation

Skilled Nursing Facility Payment Models Nursing Component Technical Expert Panel Summary

Acumen hosted a third Technical Expert Panel in June 2016 to provide an outline of basic payment structure for a revised SNF PPS, including the various new components of the revised SNF PPS and a discussion of potential pricing schedules which may be incorporated. The slides used during this TEP, as well as a report that summarizes the discussion and recommendations of the Technical Expert Panel, may be found below:

Skilled Nursing Facility Payment Models Technical Expert Panel Presentation

Skilled Nursing Facility Payment Models Nursing Component Technical Expert Panel Summary

Acumen hosted a fourth Technical Expert Panel in October 2016 to provide an outline of the recommended alternative payment model for a revised SNF PPS, including the various new components of the revised SNF PPS and a discussion of potential pricing schedules which may be incorporated. The slides used during this TEP, as well as a report that summarizes the discussion and recommendations of the Technical Expert Panel, may be found below:

Skilled Nursing Facility Payment Models Technical Expert Panel Summary Report

Skilled Nursing Facility Payment Models Technical Expert Panel Presentation

Technical Report

Based on the work conducted by Acumen during the second phase of the project, which included substantial feedback from stakeholders and four Technical Expert Panels, the contractor drafted a Technical Report, which discusses the research conducted by the contractor on developing an alternative to the existing methodology used to pay for services under the SNF PPS. The report identifies all of the relevant data and methodologies used in creating the contractor’s recommended alternative to the current case-mix classification system, RUG-IV, which they have named the Resident Classification System, Version I (RCS-I).

Provider-Specific Impact Analysis

To assist stakeholders in their review of the RCS-I model, as discussed in the SNF PPS Advance Notice of Proposed Rulemaking (ANPRM) and Technical Report provided above, we are providing a provider-specific impact analysis file, which details the estimated impact of the RCS-I model discussed in the ANPRM on Medicare Part A payments to each SNF in the country. We would note that, as discussed in the file, the provider and resident data is for fiscal year 2014 and represent estimated payments under RCS-I, assuming no changes in provider behavior or resident case-mix.

Provider Specific Impact Analysis

RCS-I Classification Logic

To assist stakeholders in their review of the RCS-I model, as discussed in the SNF PPS Advance Notice of Proposed Rulemaking (ANPRM) and Technical Report provided above, we are providing a narrative discussion of the resident classification logic used under the RCS-I model discussed in the ANPRM. This file provides a step-by-step walk-through that allows stakeholders to manually determine a resident’s RCS-I classification based on the data from an MDS assessment. This document should be used in conjunction with the discussions found in the ANPRM and accompanying Technical Report to better understand the process for resident classification under RCS-I.

RCS-I Model Calculation Worksheet for SNFs

The contractor is continuing with further refinements and considering potential improvements to the overall SNF PPS payment structure, and we welcome your comments and feedback. Comments on the SNF PPS payment methodology may be submitted anytime to:

SNFTherapyPayments@cms.hhs.gov