It’s easy to take what we have here for granted. But the fact remains, this is a land of unmatched freedom and opportunity. Not that it’s always crimson and clover.

For example, consider what skilled care providers are up against. They are steering their facilities through some pretty turbulent waters these days. Many might be inclined to conclude that all things considered, there’s not much to be thankful for at the moment.

Starting with staffing shortages. Yes, it can feel like searching for a needle in a haystack when it comes to finding compassionate employees. Still, isn’t it wonderful that you have the rare chance to create a workplace culture that attracts people who want to make a difference? That opportunity to help build a team that cares as much about the residents as you do seems like something to be pretty grateful for.

Nor do inadequate payment rates and more regulations make the job easier. In recent weeks alone, we’ve seen proposals emerge that would put staffing requirements and new financial disclosure requirements in place. But here’s the thing: Your commitment to providing quality care despite such challenges speaks volumes about your character. You have chosen to persevere in the face of constant adversity. That you have been able to find and demonstrate that ability is indeed something to be grateful for.

And don’t forget, not everyone is given the chance to make a difference. You get to be a real hero — ensuring that the oldest and frailest among us receive the care and attention they deserve. It’s a tough gig on the best days. But the smiles you help bring to the faces of your residents in their time of need are truly priceless.

So, as you prepare to carve the Thanksgiving turkey, remember to carve out a moment for gratitude. Despite the challenges, your role is indispensable. And your commitment is changing lives. Here’s to you, and here’s to the immeasurable impact you make.

Happy Thanksgiving!

John O’Connor is editorial director for McKnight’s.

Opinions expressed in McKnight’s Long-Term Care News columns are not necessarily those of McKnight’s.

A: Failure to meet the requirements of the Skilled Nursing Facility Quality Reporting Program will result in a 2 percentage point reduction in the Annual Payment Update (APU). This can happen when the provider does not achieve an 80% threshold on the MDS reporting requirement. 

Essentially, no less than 80% of the MDS assessments for a given data submission period must have 100% completion of the required SNF QRP standardized data elements. 

To your point, a non-compliance letter will let you know that the threshold has not been met but does not describe the specific MDS data elements that were not submitted or “dashed.”  The data elements used for reporting assessment-based Quality Measures affecting FY 2024 APU determination include Section GG discharge goal, bowel continence, certain diagnoses, height, weight, falls with major injury, pressure ulcers/injuries and drug regimen review. 

Keep an eye on your SNF QRP QM reports. These are refreshed monthly and include facility-level and resident-level information for a single reporting period. Providers also have access to the SNF QRP Review and Correct report prior to each quarterly data submission deadline and the provided data should be reviewed for accuracy. Keep in mind that “triggering” for some measures is desirable while “triggering” for others is not. Erroneous records can be corrected as long as the deadline for corrections has not passed. 

Identifying which data elements are incomplete is necessary to review processes and avoid future situations where data may not be submitted. 

Please send your payment-related questions to Eleisha Wilkes at ltcnews@mcknights.com.

A net gain of $1.4 billion for a sector comprised of over 15,000 nursing homes somewhat pales in comparison to a looming CMS staffing mandate estimated to cost nursing homes $11.3 billion a year.

The coming federal fiscal year will also be the second, and final, year of a “parity adjustment” intended to claw-back inadvertent overpayments under the Patient Driven Payment Model (PDPM) methodology.  As was explained in last year’s payment rule, CMS, mercifully, spread out the parity adjustment, “taking a more cautious approach in order to mitigate the potential negative impacts on providers, such as the potential for facility closures or disproportionate impacts on rural and small facilities.”

That this adjustment has been made is consistent with the fact that the transition to PDPM was “not intended to result in an increase or decrease in the aggregate amount of Medicare Part A payment to SNFs.” 

While I do not suggest this budget neutrality intent be ignored, the zeal with which CMS has pursued nursing home overpayments is in marked contrast to its laissez-faire attitude elsewhere.

Specifically, a June analysis by University of Southern California researchers estimated overpayments to Medicare Advantage insurers may be “$75 billion or more” in 2023 alone, which is almost three times higher than the apocalyptic figure that had been estimated ($27 billion) by the Medicare Payment Advisory Commission. Taxpayer subsidization of Medicare Advantage has started to look less like a rational payment program and more like the 1978 Lufthansa Heist.  Last February, the federal government even admitted in a rule that it was forfeiting claim to an estimated “$2 billion in improper payments” to insurers from 2011-17.

By itself, that generous gift easily exceeds the net Medicare gain nursing homes will see in the coming federal fiscal year.  The juxtaposition also makes jarring the CMS rejection in this year’s nursing home payment rule of the suggestion from “[a] few commenters . . . that the PDPM parity adjustment be delayed, reduced, cancelled or be phased in over an additional 2 years” to ease the burden upon providers besieged by costs.  

Not content to chisel only taxpayers, Medicare Advantage gluttony is also occurring at the expense of beneficiaries in nursing homes and their providers alike.  Marc Zimmet, president of Zimmet Healthcare Services Group, has created a dynamic “debt clock” calculating the losses from Medicare Advantage across the skilled nursing sector and broken out to the average facility.  This year’s aggregate loss will easily exceed the cost of the $11.3 billion staffing mandate scenario.    

Indeed, the day may come when the annual, much-anticipated Medicare payment rule – the product of so much concern and input by providers and their advocates – is largely irrelevant.  After all, it speaks to fee-for-service payments at a time when most Medicare beneficiaries will soon be in managed care. 

Even New York City tried to dump a quarter-million municipal retirees and their dependents into Medicare Advantage to save the city $600 million a year – an effort that has, to date, been blocked by a judge’s ruling.  Zimmet had estimated this single change alone could cost nursing homes $100 million annually.

As I write this, the prospective CMS staffing mandate is still abstract.  However, the pain inflicted upon the skilled nursing sector by Medicare Advantage is quantifiable, unchecked, and will only grow.

Brendan Williams is the president & CEO of the New Hampshire Health Care Association.

The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.

Have a column idea? See our submission guidelines here.

We are experiencing many challenges as our post-acute world transitions to having managed care payors covering the majority of patients. The ways this shift impacts providers are exasperating as large health plans have been changing their reimbursement methodology from PDPM to Leveled Contracts.

MA in the USA

To put the Medicare Advantage growth into perspective, there are more than 3,998 MA plans available in 2023, the largest amount offered since Kaiser the Family Foundation began keeping count in 2010. KFF reports that the average Medicare beneficiary in 2023 can choose from 43 Medicare Advantage plans.  

Twenty-one states are now at 50% or higher statewide MA penetration, with Alabama and Michigan leading the way at 57% each. Medicare Advantage penetration is projected to increase for years to come. 

The rise in MA enrollment and impact of levels-based contracts

As more post-acute care patients are covered by MA plans, insurers continue to experiment with payment models. Leveled contracts are intended to deliver the care a patient needs within carefully defined levels of treatment and costs. Care is often segmented into four levels. Each level has a per diem reimbursement rate and an accompanying list of acceptable treatments assigned to the level. The provider must get authorization before giving care that is at a higher level. 

There also may be a list of exclusions (additional charges that can be billed to the health plan) that are not covered in the contract’s care levels. The provider oftentimes must get authorization for providing care that is excluded. Minding this exclusions list is very important. 

So how does this process affect the provider, especially a skilled nursing facility? Critical steps must be put in place to operationalize the contract and prevent loss of reimbursement on each case. 

1. Contracts: Get it right from the start 

Spend time on the front end when negotiating a leveled contract. Review not only rates and level definitions, but also key terms and exclusions. If you are not familiar with leveled contracts or simply don’t have the time (those health plans can consume a significant amount of time), outsource this task to someone who does. Getting it right from the beginning is important.

2. Give access so key eyes are on a leveled contract 

Once the contract is complete, all team leaders should have easy access to it. The administrator, director of rehabilitation, director of nursing, admissions and case manager should be included. In managed care audits we’ve completed nationwide, lack of access to a leveled contract oftentimes is one of the missing pieces that undeniably has providers suffering significant financial losses. If we want to succeed with leveled contracts, that contract must be referenced daily as the team delivers care.

3. Find a rock star case manager 

Case managers (or care managers) are the one point of contact for managed care patients. These folks are responsible for understanding the leveled contracts and referencing them daily based on the patient’s needs. If there is a change of condition and the patient requires a higher level of care, the case manager would obtain an authorization and prevent lost revenue. 

This role is critical. It is likened to the role the MDS nurse plays in traditional Medicare patient reimbursement. Unlike MDS assessments, a managed care patient’s care level needs to be reviewed DAILY. It’s imperative if we want to be paid accurately for the services we provide.

This role is time-consuming, and that’s challenging when staffing is already a pain point. The good news: There is managed care software out there that can capture changes in levels and identify exclusions, easing the burden off the case manager and making it easier for them to help secure reimbursement.

4. Communication: Bringing it all together

The key to success with leveled managed care contracts is ensuring they are operationalized within your facility. Developing best practices, being efficient with time and resources, and having a clear workflow are paramount. All of the above requires exceptional communication. 

There are several departments and roles that touch the managed care patient experience. Daily communication is required. Whether it be through daily meetings or noted in a managed care software platform, the communication needs to be there. 

We are an industry of consistent change and movement. Some big, some small. We have adapted, bent, moved and stretched in many directions. The shift to leveled contracts is a significant change that affects our reimbursements as well as our daily management of a patient. As with any change, education, preparation and agility are keys to success.

Susie Mix, BS, MBA, NHA, is the founder and CEO of Mix Solutions, Inc. She has more than 20 years of experience in the post-acute care industry. She has firsthand experience running facilities and holds the long-term care mission close to heart. Her experience working in the field, coupled with her time spent at a health plan, provides a unique blend of knowledge that helps her provide solutions for each client. Mix has been a managed-care consultant for facilities since 2009.

The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.

Have a column idea? See our submission guidelines here.

The Medicare Payment Advisory Commission has been studying potential designs of a uniform prospective payment system for post-acute care providers (PAC PPS) since required to do so by the IMPACT Act in 2014.

It would align payment methodologies among skilled nursing facilities, home health agencies, inpatient rehabilitation facilities, and long-term care hospitals. MedPAC has issued previous reports updating Congress on its efforts and potential design elements. This year, MedPAC reviewed a separate approach to a unified payment system that was created by the Department of Health and Human Services and the Centers for Medicare & Medicaid Services.

“The Secretary took a somewhat different approach than MedPAC did but still came to the conclusion that a unified PAC PPS could be developed with existing data,” MedPAC Executive Director James Matthews, PhD, said during a press briefing. “This is something that is analytically within reach, although there are substantial policy elements that would need to be implemented in conjunction with the PAC PPS that make it somewhat more difficult than simply designing a new system.”

Regulatory alignment, Matthews said, would present a “tremendous administrative challenge” for Medicare. In its executive summary, MedPAC said developing such companion policies “could take many years; implementing them would be complex and possibly controversial.”

Among the required adjustment would be changes to Medicare’s benefit and coverage rules; alignment of cost-sharing requirements across settings so that beneficiaries do not make treatment decisions based on financial considerations; changes to requirements of participation to equalize providers’ costs; and establishment of a new PAC value incentive program “to help counter the incentives inherent in any PPS for providers to stint on needed care or generate unnecessary volume.

The commission did not make recommendations on either proposed system in the report. Instead, members voted to pass full information on to Congress and policymakers so that they can consider it for possible next steps.

Caution against underpaying nursing homes

The impacts of a unified system wouldn’t be clear until a design was chosen, but some redistribution of payment would be likely, MedPAC wrote.

“For example, if payments were set at the average predicted cost across all settings and stays, as in the Commission’s PAC PPS design, payments would shift from high-cost to low-cost settings and providers,” the report said.

And because home health agencies have considerably lower costs than institutional settings like nursing homes, an adjuster for home health stays “would be needed to guard against overpayments for HHA stays and underpayments for institutional PAC stays.”

MedPAC said its analysis, however, found no need for a payment adjustment based on a rural location, beneficiaries who had a preceding hospital stay or those with low incomes. While the commission said a PAC PPS would likely need to measure functional status as a risk adjuster, it also acknowledges that providers “have an incentive to record functional status information in ways that raise payments rather than capture patients’ actual clinical care needs.” It said CMS would need to make regular adjustments to payments to address the effects of upcoding, as the agency already does for hospital and MA payments.

But a complete overhaul of all systems might not be as necessary as it once was, MedPAC noted in its report. The evaluation of a unified payment system began before CMS adopted new, similar payment models for skilled nursing and home health providers.

“The changes that CMS has implemented to the SNF, HHA, and LTCH PPSs in recent years have helped to reduce the incentives these providers had to furnish low-value care (including unnecessary rehabilitation therapy and paying LTCH rates to cases that do not require that level of service),” MedPAC wrote. “Given the considerable resources that would be required to develop and implement a PAC PPS, policymakers may wish to look for opportunities to adopt smaller scale site-neutral policies that could address some of the overlap of similar patients in different settings.”

The state’s Department of Medicaid Services designated the funds, meant to help nursing homes cope with inflationary pressures, as a “forecast error” to provide the funds quickly.

“The initial response from our membership has been positive,” Betsy Johnson, president of the Kentucky Association of Health Care Facilities, told McKnight’s Long-Term Care News Friday. “Our members need dollars in the door right now to deal with increased costs.” 

Kentucky’s Medicaid rate has not been rebased since 2008. The association and providers have been actively lobbying lawmakers and the executive branch for rebasing and funding increases in a desperate attempt to prevent facilities from shuttering. A letter-writing campaign proved particularly effective. 

Across the US this spring, nursing homes have secured sometimes historic Medicaid increases. It’s a trend Johnson hopes her members will be able to take advantage of.

But as negotiations continue, especially in states whose legislatures develop two-year budgets, worries are already arising about how willing state lawmakers will be to sustain increases. Some fear a one-and-done approach, or pay structures that give a big boost that will still leave facilities with daily losses — only to be followed with minimal percentage increases next session.

That was the case in Pennsylvania, where providers won a significant, 17% increase in 2022 after a 10-year dry spell. They faced the possibility of a flat line budget this year until state associations were eventually able to secure a small increase for nursing homes.

In Colorado, where nursing home spending was cut by 2% during the pandemic, a 2024 budget proposal offered a 10% increase, followed by 3% in 2025 and 1.5% in 2026. 

Such fall-offs in Medicaid increases were a topic of concern at the American Health Care’s Association meeting in Washington, DC, last week.

“Continual investment in our Medicaid provider nursing homes is critical to ensuring that facilities can sustain and reward their staffs and that the resources will always be present to care for the most vulnerable among us,” Rick Abrams, president and CEO of the Wisconsin Health Care Association told McKnight’s. “Our nursing homes will always be a critically important long-term care option for our seniors and for people living with disabilities.”

In Wisconsin, Abrams is “encouraged” that historic Medicaid increases in the 2021-23 budget will be maintained because they were added to the state’s rate-setting methodology.

The uptick brought the state’s direct nursing care component of the rate to a “very respectable” level of 125% of median cost; Abrams hopes to secure a similar increase for the state’s support services component for the next two-year budget, which will kick in July 1. That could mean a much-needed Medicaid funding infusion of $55 to $70 per patient day.

In Kentucky, the current, average daily Medicaid rate for providers is $221.20, which includes a $29 per day add-on that has been in place since Jan. 1, 2020. Rural providers can expect an increase of approximately 8% while urban facilities will get an additional 7.9% due to the emergency bridge funding. Johnson said they asked for an increase that would have amounted to approximately $28.80 per patient per day. 

David McKenzie, the owner of The Jordan Center, a 110-bed facility in Lawrence County, one of the poorest counties in the state, sent a letter to Eric Friedlander, secretary for the Cabinet for Health and Family Services, saying the facility “will not make it” unless it sees a Medicaid increase by July 1. Fully 90% of the facility’s revenue comes from Medicaid, McKenzie wrote. 

“We did everything the government asked of us,” McKenzie’s letter said. “We spent the money as we were asked, we were good stewards of the funds. … We have no one else to turn to for help.”

In an interview with McKnight’s Friday, McKenzie, who sits on the KAHCare board, said he was forced to close a wing during the pandemic due to staffing shortages, which also resulted in denying admissions. The facility regularly operated at 97% capacity prior to COVID-19. 

“I recalculate and recalculate my break-even every month,” McKenzie said. “Although [the bridge funding] is not enough to put me in the black, it’s certainly better than nothing. I’m grateful. And the [funding] — it’s close, which means hopefully that I can hang on a little longer.”

The Jordan Center has operated in Louisa, KY, as a family-owned business since 1974. McKenzie’s letter indicated that the facility did not have to lay off any employees during the pandemic, despite being in a “valley of death” as the one-two punches of COVID-19, inflation, and staffing problems continue pummeling the facility. He said on Friday that a single catastrophic event such as a broken sprinkler system or roof repairs could doom the nursing home. 

“I don’t know,” he said, when asked if the bridge funding would be enough to keep the facility afloat. “It’s touch and go. I’m in a high-risk situation and holding on by my fingertips. It’s a scary place to be.” 

Such a program could bring more stability to a struggling subset of nursing homes, much as it has for about two-thirds of the nation’s rural hospitals.

Certified critical access hospitals are paid based on their costs, rather than on patient lengths of stay or services. This creates a reliable funding source to help sustain providers with potentially low patient volumes. The special designation originated in the 1990s after a string of rural hospital closures in the previous decade.

A similar program has never been created for nursing homes, but some providers believe now could be an ideal time. Many skilled nursing operators, especially those in some rural states, were squeezed hard by stagnant Medicaid rates even before the pandemic. Now, they are inching ever closer to closure amid continuing COVID-19 precautions and staffing shortages.

“Policymakers need to understand ‘rural’ doesn’t mean low-cost. We are unique and the unique needs for providing care in rural communities need to be addressed,” said Mark McKenzie, CEO of Focused Post-Acute Partners, which operates 29 skilled nursing communities in Texas. Twenty of those are in rural areas, some in towns with as few as 3,000 residents. “Years ago, it wasn’t a detriment to be a rural SNF provider, but COVID process mandates had a real and lingering negative impact on staffing and overall costs.”

Solution for mounting costs?

While McKenzie said he has seen the idea of a SNF critical access program creep into more conversations since raising the issue with McKnight’s Long-Term Care News last fall, he said it’s not driving enough significant political discourse yet. Many providers and state advocacy groups remain focused on other priorities: immediate increases in Medicaid funding and an expected to staffing ratio, to name a few.

Bloomberg Law reported on the concept Wednesday morning, noting that nursing home groups are “calling” for such a designation.

A LeadingAge spokeswoman told McKnight’s there was significant interest in a critical access program among that organization’s members. 

“Increasingly, for too many older adults and families — particularly those who live in less populated areas — access to and availability of the much-needed 24/7 care that nursing homes provide is no longer an option,” said Katie Smith Sloan, president and CEO. “Multiple issues, from insufficient reimbursement that does not cover the cost of care, and continued staffing challenges plus rising operating costs — for recruitment, wages, as well as inflation-fueled price increases for food and other commodities — are simply too much for some providers. They cannot keep their doors open.”

A critical access nursing home program “could help to level the playing field” for operators in rural areas where it can be even more challenging and expensive to hire required workers, and where closures are already sending displaced residents far from home for needed care.

Without the kind of stability a critical access payment reform could bring to rural providers, McKenzie said, “skilled nursing facilities will close and that will create an enormous gap in local access. If that happens, families may be 45 to 90 miles from the next long-term care setting.  That is really shortchanging rural communities.”

Other priorities first

While American Health Care Association President Mark Parkinson was quoted extensively in the Bloomberg article, a spokeswoman for the nation’s largest provider group told McKnight’s it doesn’t have a formal proposal on the concept.

AHCA has been busy advocating for state-rate increases and potential staffing solutions, which it says are the main influences on closures nationwide.

Bloomberg characterized Parkinson as saying a critical access program for SNFs could be a “life line,” even if it paid just 1% on top of operating, which is how participating hospitals are funded.

McKenzie said he would “absolutely” participate in a plan with those conditions.

“It enhances our ability to ensure access to these populations, as well as enhances our ability to recruit — which I could do with that 1%. However, exploration of a different methodology should be considered as well. If providers are in an environment with an adequate Medicaid rate, a Critical Access designation could include targeted funding just [for] administrative costs and labor, as an example,” he said. 

He acknowledged that the effort to drive policy forward on this could be stymied by a perception that a rural program would take federal dollars away from other providers.

But some see value in protecting access in urban areas too. A report last month from LeadingAge LTSS Center urged lawmakers to pursue financing and other solutions that support challenged urban operators.

Also, a report commissioned by AHCA early last year found that facilities most likely to close during the pandemic tended to be smaller, with fewer than 100 beds, and in urban settings where residents rely on Medicaid.

For any new payment designation, providers would be beholden to Congress. CMS has no authority to create classes of providers outside of its current payment rules.

“Before there is movement in this direction — if it gains momentum — we need a practical definition of a Critical Access SNF and a clear understanding how any reimbursement adjustment would be managed,” McKenzie said.

One wisecrack editorial managers sometimes share about their junior colleagues goes something like this:

Q: What’s the difference between a journalist and a puppy?

A: Puppies grow up.

Anyone who has spent time around scribes will agree there’s a very large kernel of truth in that comparison. Truth be told, many journalists can more than hold their own when it comes to kvetching, or behaving like children in need of a nap.

But those same annoying characteristics help journalists to do their jobs. Moreover, their whinings are often, well, valid.

A similar joke about the skilled care sector might go as follows:

Q: What’s the difference between a nursing home operator’s predictions and the boy who cried wolf?

A: In the parable, something terrible actually happens.

Let’s face it, providers do tend to moan a lot. Disappointing payment increases are often mischaracterized as cuts. Regulations of any sort are fought hammer and tongs. At industry events, it’s easy to conclude the whole enterprise is veering toward an abyss.

Still, there are times when actual survival is at stake. As it happens, one of those times happens to be right now.

Yet outside the field, there doesn’t seem to be too much hand-wringing about the very real challenges you face. In fact, the general public sentiment toward nursing home operators might be summed up as follows: There they go again.

But it’s not just whining right now. There is a real staffing crisis going on. Costs are rising as never before. Occupancy remains low. More than a few operators are reducing the number of markets they serve. Others are leaving the field completely.

This time, the proverbial ravenous wolf truly is among us. And that reality is hardly something to joke about.

John O’Connor is editorial director for McKnight’s.

Opinions expressed in McKnight’s Long-Term Care News columns are not necessarily those of McKnight’s.

The recommendations came on the second day of the advisory group’s December meeting, with staff citing the overall financial health of the sector and the size of the Medicare margin between Medicare payments and operator’s costs.

MedPAC members, while largely backing the recommendations, also expressed concerns about the sector’s sustainability given factors outside of Medicare.

“I want to double down on a comment I make every year,” said David Grabowski, PhD, a Harvard Medical School professor. “This way of paying and supporting nursing home care in this country is completely broken. From a Medicare perspective it’s healthy, but from an industry perspective this is a flawed model, overpaying with one public payer and underpaying with the other and hoping for the best. In certain facilities it might work but many are really struggling, they do very little Medicare and a lot of Medicaid.

That’s not a MedPAC problem per se, but it’s an industry problem and the issue is going to be magnified at the end of the PHE. I do worry that even though we’re not up against it this year, in the coming cycles there’s going to be some real challenges in this sector.”

Other MedPAC members acknowledged the effects the proposed cut could have, especially if the public health emergency ends sometime in 2023.

The Centers for Medicare & Medicaid Services’ Skilled Nursing Facility Prospective Payment System proposed rule for fiscal year 2023 cut 4.6%, or $1.7 billion to offset overpayments during the transition to the Patient Driven Payment Model. The result was a takeaway of about $320 million in Medicare Part A payments to SNFs.

A recalibration of PDPM’s parity adjustment factor of 4.6% includes a two-year phase in period in a win for providers — decreasing SNF spending by 2.3% in fiscal 2023 and 2.3% in fiscal 2024. 

But MedPAC chairman Michael Chernew, PhD, a professor at Harvard Medical School, reminded the group of its mission.

“Our mission is to pay for the amount necessary to provide efficient care to Medicare beneficiaries for the services that Medicare is providing,” he said.

“There’s this tension between the mission of what we’re actually doing, which turns out to not be fixing a broken payment system for SNFs. We have a much more narrow job across this recommendation. We are not signaling that the sector is healthy long-term. We are doing a much more proscribed exercise.”

Staff reported the aggregate Medicare margin for freestanding SNF was 17.2%. They also cited a higher all-payer margin in 2021 at 3.4%, up from 3.1%, investor interest in the sector and the relative stability of government funding. 

Also, the Medicare median margin for “relatively efficient” SNFs was 22%. Compared to other SNFs, MedPAC staff said relatively efficient SNFs had better discharge to community rates, lower hospitalization rates and standardized costs, and higher Medicare payments per day.

Another member supported the recommendations with the same caveats.

“Given the lack of adequate Medicaid payments and the low likelihood that many state programs will address them, such a steep cut has the potential to further destabilize a sector that is still reeling from the PHE’s effects on volumes, costs and staffing issues,” said Scott Sarran, M.D, chief medical officer at MoreCare. “I’m more comfortable with a more modest reduction.”

MedPAC physician fee recommendations

On Thursday, MedPAC made recommendations that Congress update 2024 Medicare payments for physicians and other health professional services by 50% of the Medicare Economic Index increase, and enact a non-budget-neutral add-on payment under the physician fee schedule to services provided to low-income Medicare beneficiaries. The idea is to incentivize primary care physicians to continue working, with data showing a steady decline of providers since 2016.

The targeted rate hike could affect providers who serve low-income skilled nursing populations. One expert told McKnight’s Long-Term Care News the possible add-on was “unheard of.”

The commission will vote on the recommendations in January before sending them to Congress.

A: As you may have heard, the Centers for Medicare & Medicaid Services released the draft Minimum Data Set Nursing Home Comprehensive Item set version 1.18.11 on Sept. 1. Among many other changes, Section G was notably absent.

You may recall substantive changes were originally planned for 2020 but were pushed back due to the public health emergency and stakeholder concerns. Now, CMS is preparing to move forward with implementation starting Oct. 1, 2023.

On one hand, the removal of Section G is welcomed as coding of the section has been confusing since its inception. On the other hand, what does this mean for other processes that rely on Section G data?

Medicaid payment — Several states rely on an ADL score calculated from Section G that is used, in part, to establish RUG scores that inform reimbursement. These states will need to hasten planning for a new approach, whether that is a PDPM-version for reimbursement or a requirement for completion of the Optional State Assessment.

Quality Measures — Some Section G items are used as part of QM calculations directly or via covariates or exclusions. A major overhaul will be needed.

Care Area Assessments — As part of the care planning process, Section V of the MDS houses the CAAs, some of which are informed by coding responses in Section G. This, too, will need to be revised as to what “triggers” applicable CAAs.

While there is a year before implementation, you should start preparing now. Review the draft item set for all changes — there are many besides Section G — and keep watch for the release of new information, including the revised RAI and QM manuals. As this is a draft, additional changes could still be made.

Eleisha Wiles, RN, RAC-CTA, RAC-CT, DNS-CT, is a clinical consultant at Proactive Medical Review. Send her your payment-related questions at ltcnews@mcknights.com.