The Centers for Medicare & Medicaid (CMS) recently unveiled its final rule for the fiscal year (FY) 2024, bringing substantial changes and updates to payment rates for skilled nursing facilities (SNFs).
Payment Updates
Centers for Medicare & Medicaid is mandated to establish a market basket index reflecting changes in the prices of goods and services covered by skilled nursing facilities services. If you’re interested in the specifics, forecasting adjustments led to a 3% SNF market basket update. Additional adjustments, including a 3.6% forecast error increase, a 0.2% productivity adjustment decrease, and a 2.3% decrease for the Patient Driven Payment Model parity adjustment, resulted in a net increase of 4%. This amounts to approximately $1.4 billion increase in Medicare Part A payments for the fiscal year 2024.
Value-Based Purchasing Updates
The final rule also introduces an expansion of the SNF Value-Based Purchasing Program. CMS is set to adopt four new quality measures, replace one existing measure, and implement various policy changes. Noteworthy additions include the Nursing Staff Turnover and Discharge Function Score measures, aiming to enhance the evaluation of SNF performance.
Health Equity Adjustment
To recognize and reward skilled nursing facilities providing excellent care to underserved populations, CMS has introduced a Health Equity Adjustment. This adjustment will benefit SNFs with a resident population of at least 20% with dual eligibility status. The payback percentage policy under the program is also increased from 60% to 66% for 2027, facilitating bonuses for high-performing SNFs without adversely affecting others.
Quality Reporting Program Updates
The SNF Quality Reporting Program has seen adjustments as well. Centers for Medicare & Medicaid is increasing the threshold for data completion for the Minimum Data Set items, requiring SNFs to report 100% of the required quality measure data on at least 90% of the assessments submitted. Failure to meet this requirement may result in a 2% reduction in the annual payment update starting from fiscal year 2026.
Notable changes in quality measures include the adoption of the Discharge Function Score measure and the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up-To-Date measure. Three measures have been removed, and one measure has been modified, reflecting CMS’s commitment to refining the evaluation of SNF performance.
Civil Money Penalties
In an effort to streamline administrative procedures, Centers for Medicare & Medicaid has introduced a constructive waiver process. Facilities will be considered to have waived their hearing if CMS does not receive a request within the specified timeframe. While the current 35% penalty reduction remains unchanged, CMS will continue to review this policy and penalty reduction in the future.
The fiscal year 2024 final rule from Centers for Medicare & Medicaid brings significant changes, including payment increases, value-based purchasing updates, quality reporting program modifications, and a streamlined civil money penalties process. Skilled nursing facilities should stay informed about these updates to ensure compliance and make the most of the opportunities presented by these changes.
Reach out to us at Paths Law to help you navigate the changes for Medicare and Medicaid and skilled nursing facilities.