SNF Proposed Rule – 2024

‘Tis the season for CMS to release updated payment and program rules for providers under Medicare. In the past week or so, we’ve seen releases for Hospice and Inpatient Rehab Facilities. A couple of days ago, CMS released the proposed 2024 rules/updates for SNFs (skilled nursing). The fact sheet for the release is available here:

Like all of these proposed rules, there are two categories of information within: what will happen and what CMS is signaling for the future. I find the forward commentary, the future stuff, far more interesting. It has in prior rules, given us insights into programmatic staples such as VBP (value-based purchasing), PDPM replacing RUGs, etc. In this rule, we see commentary on CMS studying a move toward minimum staffing requirements. CMS/Biden administration has targeted a move toward minimum staffing requirements (direct care) concurrent with COVID. I am leery of moves like this especially since a future mandate will likely come without additional major funding increases and within a labor market that simply won’t accommodate additional direct care staff. Facilities that I know are groveling, begging for more staff and simply, cannot find them. And yes, turnover in the industry is high but much of that is tied to structural problems within the industry and corollary staffing problems (staff turning over because there is not enough staff – a circular argument).  In a post from earlier this week, I touched on the current staffing dynamics:

What CMS is proposing which, is likely to happen in the final rule and move forward on October 1 of this year, is as follows.

  • A 3.7% increase in rates.  This number comes about via a rather convoluted process and formula.  Essentially, the market basket (inflation costs) update is 6.1%.  This amount is the aggregation of a 2.7% market basket increase plus a 3.6% market basket forecast error, plus a .2% productivity factor adjustment = 6.1% (rounded). To get to the 3.7%, CMS reduces the gross calculation by 2.3% which, is attributable to the parity adjustment under PDPM.  Recall, CMS missed the spend mark with PDPM (high side) so the budget neutrality required when the payment systems changed, is being factored in via rate offsets going forward (2023 and 2024).  I know, this makes little sense to anyone trying to rationalize these rate mechanics logically.
  • Additional changes to the ICD 10 code mappings under PDPM.  The goal here is to improve consistency between coding and diagnostic maps under PDPM. 
  • A bunch of proposed refinements and additions to the SNF QRP (quality reporting program) are within this proposed rule.
    • Addition of a discharge function score which, assesses the number of residents that meet or exceed an expected score, using self-care and mobility items from the MDS.  This score is proposed to replace the discharge assessment measure (Application of Functional Assessment/Care Plan).
    • Adoption of the Short Stay Discharge Measure known as CORE Q, beginning in FY 2026 (October 1, 2025).  This measure assesses the percentage of residents post-discharge within 100 days that are happy with their care and stay in the SNF.
    • A COVID 19 measure for FY 2026 assessing what percentage of SNF residents are up to date with the recommended COVID 19 vaccination schedule.
    • A COVID 19 measure for FY 2025 assessing what percentage of SNF staff are up to date with the recommended COVID 19 vaccination schedule.
    • Remove for FY 2025, the Application of Percent of Long-Term Care Hospital (LTCH) Patients with an Admission and Discharge Functional Assessment and a Care Plan That Addresses Function (Application of Functional Assessment/Care Plan) measure.
    • Remove for FY 2025, theApplication of the IRF Functional Outcome Measures: Change in Self-Care Score for Medical Rehabilitation Patients (Change in Self-Care Score) measure; and the Change in Mobility Score for Medical Rehabilitation Patients (Change in Mobility Score) measure.
    • By FY 2026, CMS will require SNFs to submit QRP data on 100% of collected QRP data on 90% of MDS assessments submitted.  SNFs that fail to meet this standard will face a 2% reduction in the annual payment update for the fiscal year.
    • Public reporting of the transfer of health information requirement to the patient and to the subsequent provider post-discharge, will be implemented in FY 2025.  The information required is a reconciled medication list.
  • Under the VBP for SNFs, CMS is proposing a number of instrumental changes, effectively reducing the weight of readmissions via complete elimination of the 30 day all cause readmission measure.  The proposed program changes are,
    • Add a nursing staff turnover measure where data is compiled in FY2024 and factored into performance in FY 2026.
    • Addition of a discharge function score that assesses the number of residents via a functional score, that met or exceeded anticipated functional levels on discharge.  Data will be gathered in FY 2025 with performance factored in for FY 2027.
    • Addition of a long-stay hospital measure per 100 residents with data gathered in FY 2025 and performance factored in for FY 2027. The measure assesses the hospitalization frequency of long-stay residents.
    • A measure addition for falls with major injury for long-stay residents.  The data collection begins in FY 2025 and performance is factored in for FY 2027. the measure assesses the rate of falls with major injury among long-stay residents.
    • Adding a new readmission measure to assess the potential for avoidable (hospital) readmission within the SNF stay for residents (SNF WS PPR) with data collected in FY 2025 and performance factored in for FY 2028.
    • CMS is expecting to increase the bonus payment (payback)levels for high-performing facilities from 60% to 66% of the dollars withheld.
  • Finally, CMS is proposing to make a technical change to the process for CMP reductions.  Right now, if a facility waives its right to an appeal hearing, the CMP is reduced by 35%.  As 90% plus of all facilities receiving a CMP take the reduction via the waiver, CMS will change the process to one where the waiver is imputed UNLESS the facility requests a hearing within the required timeframe.

My best wishes to all for a blessed Easter and Passover holiday season!