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CMS proposes changes to SNF reimbursement

May 2, 2014
by Lois A. Bowers, Senior Editor
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Medicare reimbursements to skilled nursing facilities (SNFs) would increase $750 million, or two percent, in FY 2015 under a proposed rule issued yesterday by the Centers for Medicare & Medicaid Services (CMS).

The estimated increase is based on a 2.4 percent rise in the cost of goods and services, CMS says, reduced by the 0.4 percentage points after adjustments required by law.

“America’s skilled nursing care centers are pleased to see a proposed two percent market basket increase to providers’ Medicare reimbursement,” says Mark Parkinson, president and CEO of the American Health Care Association. “These centers have shared in the sacrifice plenty through multiple government reductions over recent years. A stable Medicare payment system is essential in keeping skilled nursing care accessible to our seniors.

LeadingAge President and CEO Larry Minnix says that organization also is pleased with the proposed increase. “This is an important recognition of the increased costs nursing homes face and the value that not-for-profit nursing homes add to their communities,” he says.

The update finalized for SNFs for FY 2014 was 1.3 percent, CMS says.

The proposed rule also would change the way Medicare reimbursement is calculated for some providers, using newer delineations from the Office of Management and Budget (OMB) to identify a provider’s rural or urban status and which rate tables to use. During a transitional year, CMS would use a wage index that would be an even blend of current and revised OMB delineations of metropolitan statistical areas, micropolitan statistical areas and combined statistical areas.

CMS also is proposing a revision to the current Change of Therapy (COT) Other Medicare Required Assessment (OMRA) policy to respond to provider concerns. The COT OMRA is used to classify a resident into a new resource utilization group (RUG) when, based on the therapy services provided during the previous seven days, the resident no longer qualifies for the RUG into which they are currently classified for payment. Under the proposed rule, CMS would permit providers to use the COT OMRA to reclassify a resident into a therapy RUG from a non-therapy RUG, but only in certain limited circumstances.

The proposed rule also clarifies information related to civil monetary penalties imposed against SNFs by CMS under the Affordable Care Act.

“AHCA will continue to analyze the proposed rule to fully understand its potential impact on the profession,” Parkinson says.

The proposed rule is to be published in the Federal Register on May 6 but can be viewed as a PDF now here. Public comments will be accepted until June 30.