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From Health Law Daily, April 16, 2015

SNFs enter world of quality reporting, value-based payment

By Michelle L. Oxman, J.D., LL.M.

CMS announced on April 15, 2015 that the net update for payments under the skilled nursing facility (SNF) prospective payment system (PPS) rates for fiscal year (FY) 2016 will be 1.4 percent. (See Advance Release of Proposed Rule, April 15, 2015). The update is derived from a 2.6 percent increase in the SNF market basket, decreased by a 0.6 percent adjustment for a previous forecasting error and by another 0.6 percent for the multifactor productivity adjustment required by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). The proposed rule also would impose quality reporting requirements and begin the transition of SNF payments to value-based purchasing (VBP). It will appear in the Federal Register on April 20, 2015.

PAMA. With the proposed rule, CMS is beginning implementation of two major pieces of legislation enacted in 2014. The Protecting Access to Medicare Act (PAMA) (P.L. 113-93) requires the Secretary to establish an all-cause, all-condition measure for hospital readmissions by October 1, 2015. SNFs will receive confidential feedback on their performance with this measure each quarter beginning October 1, 2016 and will have an opportunity to review the material and submit corrections. The law requires the Secretary to make information about SNFs’ performance on this measure available on the Nursing Home Compare site no later than October 1, 2017.

PAMA also requires that the Secretary begin to apply a VBP method beginning October 1, 2018. The methodology will require the agency to rank SNFs by performance considering both achievement and degree of improvement. The agency must subtract percentage points from the payment update to SNFs in the bottom 40 percent, using a sliding scale so that the worst-performing SNFs get the biggest cuts.

IMPACT. In accordance with the Improving Medicare Post-Acute Care Transformation (IMPACT) Act, P.L. 113-185), the agency will also require quality reporting. The first three measures proposed include skin integrity, falls, and incorporation of functional assessments in care plans. Specifically, the skin integrity measure counts the percentage of residents who have new or worsening pressure sores during their stay. The falls measure counts the percentage of residents who experience a fall resulting in a major injury. The third measure addresses whether each resident is assessed for both general and cognitive functioning on admission and at discharge and whether the plan of care addresses functioning based on the assessment.

Other requirements. The proposed rule would implement section 6106 of the ACA by requiring SNFs to report in detail on their staffing levels, including both employees and contract staff who perform direct patient care. Work would be categorized by type and the qualifications of the person(s) performing the task. SNFs also would be required to submit information about the resident census and staff turnover.

MainStory: TopStory ReimbursementNews SNFNews QualityNews CoPNews

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