Harmony Healthcare Blog

Top 6 Nuggets: SNF PPS Final Rule FY 2017

Posted by Kris Mastrangelo, OTR/L, LNHA, MBA on Thu, Aug 25, 2016

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Edited by Kris Mastrangelo


Compliance • Audits/Analysis • Reimbursement/Regulatory • Education/Efficiency

Final RuleReimbursement will dramatically change for skilled nursing homes over the next two and a half years.  The August 5th, 2017 Final Rule for the Medicare program is robust with history, a payment rate update for fiscal year 2017, as well as a detailed description of how the value based purchasing program will be implemented. 

The Department of Health and Human Services specifies Performance standards, Scoring methodologies, in addition to a Review and Correction Process for performance information to be made public.  Notable is that this Rule proposes a new measure “Potentially” Preventable Readmission Measure for the Skilled Nursing Facility Value-Based Purchasing Program (SNF VBP).  This preventable readmission measure would replace the current all-cause, all-condition Hospital Readmission measure. 

An important concept to glean from this Rule is the continued intent for Medicare to transition to a performance based reimbursement system versus a volume based system. Value based purchasing rewards for quality and not the volume or quantity of care provided. 

Harmony Healthcare International (HHI) provides you with the Top Six Nuggets that Providers and Staff need to be mindful of in order to properly prepare for these changes:

  1. Rate Increase (2.4% Increase)

    The overall economic impact of this Final Rule would be an estimated increase of $920 million in aggregate payments to SNFs during FY 2017. The resulting MFP*-adjusted SNF market basket update is equal to 2.4% (*Multifactor productivity adjustment) 
  1. Three New Measures

    To meet the mandates of the IMPACT Act, CMS adopted three new measures: 
    1. Medicare Spending Per Beneficiary: Post-Acute Care SNF QRP (FY 2018)
    2. Discharge to Community: Post-Acute Care SNF QRP (2018)
    3. Potentially Preventable 30-Day Post-Discharge Readmission Measure: SNF QRP (2018) 
  1. Value Based Purchasing Measure: Hospital Readmissions

     Proposed SNF Skilled Nursing Facility 30-Day Potentially Preventable Readmission Measure (SNFPPR). The SNFPPR measure estimates the risk-standardized rate of unplanned, potentially preventable hospital readmissions for Medicare FFS beneficiaries that occur within 30 days of discharge from the prior proximal hospitalization 
    Final Rule FY2017
  1. AIDS Add-On (128%)

    AIDS add-on established by section 511 of the MMA remains in effect! CMS estimates that there are less than 4,800 beneficiaries who qualify. Claims must contain the diagnoses code 042, ICD-10-CM B20. Claims that qualify will be subject to a 128% increase. 
  1. Presumption of Coverage

     “As set forth in the FY 2011 SNF PPS update notice (75 FR 42910), this designation reflects an administrative presumption under the 66-group RUG–IV system that beneficiaries who are correctly assigned to one of the upper 52 RUG–IV groups on the initial 5-day, Medicare-required assessment are automatically classified as meeting the SNF level of care definition up to and including the assessment reference date (ARD) on the 5-day Medicare-required assessment.”

    The law continues to state “A beneficiary assigned to any of the lower 14 RUG–IV groups is not automatically classified as either meeting or not meeting the definition, but instead receives an individual level of care determination using the existing administrative criteria.”

    Therefore, it is critical for providers to know what constitutes skilled care to make informed benefit decisions with their Medicare Part A patients. 
  1. Important Dates


We hope that you find these Nuggets helpful.  If you have questions about the Final Rule FY 2017, please contact Harmony Healthcare International by clicking here or calling our office at 1.800.530.4413.  

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Tags: Final Rule

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