On July 31, 2014, the Centers for Medicare and Medicaid Services (CMS) issued a final rule outlining the payment rates and policy changes for Skilled Nursing Facilities (SNFs) under the Prospective Payment System (PPS). This final rule will be effective on October 1, 2014.
Market Basket Update
CMS estimates that aggregate payments to SNFs will increase by $750 million, or 2.0 percent, from payments in FY2014.
CMS finalized the wage index as proposed to continue to use the updated hospital inpatient wage data, exclusive of the occupational mix adjustment, to develop the SNF PPS wage index. In addition, CMS will adopt the most recent Office of Management and Budget (OMB) statistical area designations to identify a facility's urban or rural status for determining which set of rate tables would apply. There will be a one year blended system, in which reimbursements will be based on a 50/50 split of a SNF's former and new designation. This will mitigate the negative payment impact on some SNFs due to the new OMB new delineations.
Change of Therapy OMRA
CMS finalized the proposed revisions to policies related to the Change of Therapy (COT) Other Medicare Required Assessment (OMRA). The changes would permit providers to complete a COT OMRA for a patient that is not currently classified into a RUG-IV therapy group. This would apply in rare cases where the patient had:
* Qualified for a RUG-IV Therapy category on a prior assessment during current MedicarePart A stay
* And, there was no discontinuation of therapy services between Day 1 of the COT observation period for the COT OMRA that classified the patient into the current Non-Therapy RUG category and the ARD of the COT OMRA that would reclassify the patient into a Therapy RUG category.
Additional details of this revised policy will be available in a forthcoming MDS RAI manual revision, which would be effective October 1, 2014.
SNF Therapy Research Project
This project is related to the SNF therapy payment research currently contracted with Acumen, LLC and the Brookings Institution to identify potential alternatives to the existing methodology used to pay for therapy services received under SNF PPS. The first phase of the project has been completed including a literature review, stakeholder outreach, supplementary analysis and a comprehensive review of options for a viable alternative to the current therapy payment model. CMS indicated that they appreciate the broad support for this initiative and will continue to solicit feedback through
more formal avenues. No completion date has been set.
Therapy Utilization Trends
The proposed rule also discussed recent observed trends related to therapy service provision under the SNF Part A benefit.
* It was observed that the percentage of billed days of service for the RU groups increased from 44.8% in FY2011 to 48.6% in FY2012 while all the other RUG categories remained stable or declined. The data was updated to demonstrate that the percentage of RU RUG groups has increased in FY2013 to over 50%.
* The second identified trend highlighted in the Proposed Rule indicates that the amount of therapy reported on the MDs is just over the required therapy minute threshold for a given RUG category CMS has posted a memo, "Observations on Therapy Utilization Trends," on the SNF PPS website and invited the discussion of observed trends.