Report to Congress: Unified Payment for Medicare-Covered Post-Acute Care

Unified PAC Report to Congress (PDF) | Unified PAC Report to Congress Appendices (ZIP)

Section 2(b)(2)(A) of the Improving Post-Acute Care Transformation (IMPACT) Act of 2014 requires a report to Congress on unified payment for Medicare post-acute care (PAC). Medicare PAC services are provided to beneficiaries by PAC providers defined as skilled nursing facilities (SNFs), inpatient rehabilitation facilities (IRFs), long-term care hospitals (LTCHs), and home health agencies (HHAs). Each PAC provider setting has a separate Medicare fee-for-service (FFS) prospective payment system (PPS). A goal of unified PAC payment is to base the payment on patient characteristics instead of the PAC setting.

The Centers for Medicare and Medicaid Services (CMS) and the Office of the Assistant Secretary for Planning and Evaluation (ASPE) contracted with Research Triangle Institute (RTI) to provide analysis for this study and report. RTI convened external technical expert panel meetings to obtain input on the study and report. In the report, the framework applies a uniform approach to case-mix adjustment across Medicare beneficiaries receiving PAC services for different types of PAC providers while accounting for factors independent of patient need that are important drivers of cost across PAC providers. The unified approach to case-mix adjustment includes standardized patient assessment data collected by the four PAC providers. The report does not include legislative recommendations, as additional analyses would need to be done prior to testing or universal implementation of a unified PAC payment system.

The RTI Reports from Phase I and Phase 2 are posted in the Downloads Section below.

On September 27, 2004, CMS awarded a contract to Research Triangle Institute (RTI) to evaluate and determine the feasibility of implementing recommendations made by the Medicare Payment Advisory Commission (MedPAC) in June 2004 for the establishment of facility and patient criteria for long-term care hospitals (LTCHs) and for an expanded role for Quality Improvement Organizations (QIOs) in monitoring compliance with the newly-established hospital and patient criteria.

RTI completed this project in two phases. In Phase I, RTI prepared a background report summarizing existing information regarding LTCHs' current role in the Medicare system: their history as Medicare participating providers, the types of patients they treat, the criteria QIOs currently use to review appropriateness of care in these settings, and the types of regulations they face as Medicare participating providers. This work reviewed prior analyses of these issues and included discussions with MedPAC, other researchers, CMS, the QIOs, and the hospital associations.

In Phase II, RTI collected additional information on tools currently used by the QIOs and the industry to assess patient appropriateness for admission; analyzed claims to understand differences between populations with outlier stays in non-LTCHs and those treated in LTCHs; and visited different types of hospitals to hear first-hand how LTCH patients differ from those in other settings and how this pattern varies in different parts of the country. RTI worked with different associations, including the National Association of Long Term Hospitals, (NALTH), and the Acute Long Term Hospital Association (ALTHA), the American Hospital Association (AHA), and the American Medical Peer Review Organization (AMPRA) as well as several of the larger LTCH chains. The final report submitted by RTI summarizes these efforts and makes its recommendations to CMS regarding LTCHs.

The reports are posted as received from the contractors and do not represent CMS's position or policy. CMS has included further discussion of RTI's work on this project in the rate year (RY) 2008 LTCH prospective payment system (PPS) final  rule (72 FR 26947).  Further discussion of RTI's research is published in the RY 2009 LTCH PPS proposed rule published in the January 29, 2008 Federal Register.

Questions concerning the RTI reports should be addressed to Dr. Barbara Gage, RTI, International, 1440 Main Street, Waltham, MA 02451-1623 or

Page Last Modified:
09/06/2023 04:51 PM