The Centers for Medicare and Medicaid Services (CMS) has released the new Minimum Data Set (MDS) 3.0 Quality Measures (QM) User’s Manual Version v18.0, which contains elements that skilled nursing providers need to be aware of. The update is effective from Jan. 1, 2026.

To explain the update, Alicia Cantinieri, managing director, clinical reimbursement & regulatory compliance, Zimmet Healthcare Services Group, answered some key questions.

Park Place Live (PPL): What notable changes are in the MDS 3.0 QM User’s Manual v18.0?

Cantinieri: The incorporation of claims data into the Long-Stay Percent of Residents Who Received an Antipsychotic Medication QM was first announced by CMS in QSO-25-20-NH on June 18, 2025, and reaffirmed in the revised version issued Sept. 10, 2025. Therefore, this change should not be viewed as unexpected. The initial memo communicated CMS's intent to add Medicare and Medicaid claims and encounter data to the measure calculation, while the September revision updated the implementation timeline to January 2026.

With the release of v18.0, CMS has now provided detailed specifications for how claims data will be incorporated into the numerator—clarifying which residents will be counted as having received an antipsychotic medication and therefore included in the measure. The respecified measure is expected to be publicly reported on Care Compare in January 2026, and will use the data from July 1 to Sept. 30, 2025, and will be updated quarterly.  

PPL: Two major updates are tied to the respecification of the long-stay antipsychotic measure and a risk adjustor modification to the discharge function score measure, based on the removal of occupational and physical therapy minutes from the MDS version 1.20.1. What concerns are there about this update?

Cantinieri: The update to the covariates for the Discharge Function Score Measure revises the risk adjustment factor for "No physical or occupational therapy at the time of discharge," replacing the retired MDS items O0400B/C (removed effective 10/1/2025) with the new items O0425B/C. In practice, this change aligns the covariate with its new data source. MDS item O0425 captures all physical and occupational therapy minutes provided during the Medicare Part A stay and reported at discharge. Given the consistency in intent and data elements, this update is not expected to have a significant effect on reported Discharge Function scores.

PPL: On the antipsychotic medication change, the new CMS update said Medicare and Medicaid claims and encounter data will now factor into the percent of residents who had such medication ordered or filled for them during their entire nursing facility stay. Previously, only the MDS seven-day look back was used. What is significant about this?

Cantinieri: The Long-Stay Percent of Residents Who Received an Antipsychotic Medication measure includes residents with 101 or more cumulative days in the facility. This update reinforces CMS's continued focus on oversight of antipsychotic medication use and the potential miscoding of excluded diagnoses in MDS Section I, as well as on reporting antipsychotic use in MDS Item N0415 – High-Risk Drug Classes: Use and Indication.

Under the revised specifications, residents will be included in the numerator not only when antipsychotic use is coded on the MDS during the ARD 7-day look-back period, but also when:

• Medicare Part D or Medicaid pharmacy claims/encounter data indicate an antipsychotic medication dispensed during the nursing home stay (based on the claim fill date), or

• The medication appears on a Medicaid Other Services claim or a Medicare Part B/ Outpatient physician claim for antipsychotic medications.

PPL: Anything else to know on this?

Cantinieri: Additional exclusions have been added related to Medicare enrollment status and hospice, and if the antipsychotic was used when the resident was discharged from the facility, e.g., during a hospital stay.

Although the list of diagnoses that exclude a resident from the measure has not changed, the exclusion logic will now also apply when these diagnoses are identified on the claims. A concern is that the updated methodology does not appear to account for residents who are not otherwise excluded and have a medication dispensed but not actually administered or administered only a few times as needed or discontinued quickly, which could overstate true exposure to antipsychotic medications.

Another example is for those residents with orders for these medications who are at the end of life with a terminal diagnosis but are not enrolled in a formal hospice program.

An additional concern is that the facility does not have input or control over the diagnosis of codes entered by the pharmacy on the claims, which may not match the documentation in the resident's nursing home medical records. 

How to Prepare

To get ready for the changes, the American Health Care Association (AHCA) said providers can monitor their Five-Star Preview reports when available on iQIES. “The preview report for the January refresh should be available around the 3rd week of January 2026 and will provide you with the measure calculation prior to public posting,” AHCA said.

Other steps include ensuring ICD-10-CM codes are kept up to date in the electronic medical record. “The updated antipsychotic medication measure adds claims data (including ICD-10-CM codes) to validate diagnoses,” AHCA said. 

Lastly, providers can pull and review their QM package reports in iQIES to validate accuracy of data. This information may be used to conduct chart audits and make corrections if necessary, the association said. 

Find the MDS update at https://tinyurl.com/3shk8uam.

Comments or questions? Contact Patrick Connole at pconnole@parkplacelive.com.