CMS Keeps 2.4% Rate Hike in SNF PPS, but QRP a Concern

Late Wednesday, the Centers for Medicare and Medicaid Services (CMS) issued its Fiscal Year (FY) 2027 Skilled Nursing Facility (SNF) Prospective Payment System (PPS) Final Rule (CMS 1843-F), maintaining the 2.4 percent rate hike for SNFs from the April draft rule, but raising sector concerns by expanding the Quality Reporting Program (QRP).

In the rule, for FY 2027, CMS finalized updating SNF PPS rates by 2.4 percent based on the final SNF market basket of 3.3 percent, reduced by a 0.9 percent productivity adjustment, for an estimated increase of $882.74 million in aggregate payments to SNFs.

As for FY 2027 final updates to the SNF QRP, CMS said it is finalizing the removal of two measures from the SNF QRP, beginning with the FY 2028 SNF QRP: (1) the COVID-19 Vaccination Coverage Among Healthcare Personnel measure, and (2) the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date measure.

CMS said it is finalizing the revised data submission timeframe from 4.5 months to approximately 45 days, beginning with the FY 2029 SNF QRP. This shortened time frame, it said, will reduce the lag between data submission and public reporting by up to three months, resulting in timelier data for consumers and their families. SNFs will also have earlier access to data to support their quality initiatives.

Here Is the Kicker

On MDS Data Submission, CMS said to obtain the most accurate SNF quality of care information and to remain relevant to the SNF community and consumers, CMS is finalizing a requirement for all SNFs to submit MDS data for all SNF residents receiving covered skilled care, regardless of payer.

“This will align the SNF QRP with other Post-Acute Care settings and CMS programs that already collect data on all patients regardless of payer,” CMS said.

Clif Porter, president and CEO, American Health Care Association/National Center for Assisted Living, said the sector appreciates CMS for recognizing the importance of maintaining stable Medicare reimbursement for SNFs.

But there is an issue, he said.

“Reimbursement policy that reflects the increasing needs of our patients and the increasing costs to deliver that care is essential to supporting seniors and their caregivers. At the same time, we are concerned that expanding the SNF Quality Reporting Program to all residents regardless of payer source will drastically increase administrative burden without directly improving clinical care for patients,” Porter said. “We remain committed to working with CMS on policies that further invest in strengthening access to high-quality post-acute care while streamlining reporting in order to put patients before paperwork.”

Other Sections

In addition, CMS said it received comments on one potential measure topic that might be adopted in future years for the SNF QRP: advanced care planning (ACP). 

ACP is a continuous process of conversation and documentation to align a patient’s care and interventions with their beliefs, values, and preferences if they become unable to make those decisions. CMS provides a summary of comments received in the FY 2027 SNF PPS final rule, the agency said.

Also, for the SNF Value-Based Purchasing (VBP) Program, CMS finalized performance standards for the FY 2029 and FY 2030 program years to comply with the program’s statutory notice deadline.

CMS said it will update the “snapshot date” codified at 42 CFR § 413.338(f)(1)(v) for two measures calculated using MDS assessment data to maintain alignment with the newly finalized SNF QRP submission deadlines for MDS assessment data, beginning with FY 2027 data. The SNF VBP adjustments for certain SNFs subject to the net reduction in payments under the SNF VBP and which are not incorporated into the impact estimates for the payment rate are an estimated $203.60 million reduction in FY 2027.

RFI on PDPM

In the final rule, CMS said “this RFI focused on potential updates to the Patient Driven Payment Model [PDPM] payment system as part of a broader effort to ensure that payment policy reflects current care practices and changes in the SNF resident population. The RFI also focused on how CMS could address observed case-mix upcoding. CMS will take the comments received under advisement in any potential proposed adjustments in future rulemaking.”

The SNF Prospective Payment System Final Rule can be viewed on the Federal Register at: https://www.federalregister.gov/public-inspection/current

April v. July

In the April rule, CMS proposed updating SNF PPS rates by 2.4 percent based on the proposed SNF market basket of 3.2 percent, and a negative 0.8 percent productivity adjustment.

Of note, for FY 2024: the productivity adjustment was a 0.2 percentage point reduction, for FY 2025: a 0.5 percentage point reduction, and for FY 2026: a 0.7 percentage point reduction.

“Note that these impact figures do not incorporate the SNF VBP [Value-Based Purchasing] reductions for certain SNFs subject to the net reduction in payments under the SNF VBP. The SNF VBP adjustments are estimated to total $208.4 million in FY 2026,” CMS said in the April draft rule.

Questions or comments, contact Patrick Connole at pconnole@parkplacelive.com.