SNF Prospective Payment System: FY 2022 Proposed Rule

Mary Madison, RN, RAC-CT, CDP
Clinical Consultant – Briggs Healthcare

Late on the afternoon of April 8, 2021, CMS issued a proposed rule that would update Medicare payment policies and rates for Skilled Nursing Facilities (SNFs) under the SNF Prospective Payment System (PPS) for Fiscal Year (FY) 2022. In addition, the proposed rule includes proposals for the SNF Quality Reporting Program and the SNF Value-Based Program (VBP) for FY 2022.

CMS estimates that the aggregate impact of the payment policies in this proposed rule would result in an increase of approximately $444 million in Medicare Part A payments to SNFs in FY 2022. This estimate reflects a $445 million increase from the update to the payment rates of 1.3 percent, which is based on a 2.3 percent SNF market basket update, less a 0.8 percentage point forecast error adjustment and a 0.2 percentage point multifactor productivity adjustment, and a $1.2 million decrease due to the proposed reduction to the SNF PPS rates to account for the recent blood-clotting factors exclusion. These impact figures do not incorporate the SNF VBP reductions that are estimated to be $184.25 million in FY 2022.

The Fact Sheet provides these proposed updates to the Patient Driven Payment Model as well as other proposals for the industry:

  • Methodology for recalibrating the parity adjustment.
  • Proposed changes in ICD-10 code mappings.
  • Proposal to rebase and revise the SNF market basket to improve payment accuracy under the SNF PPS by proposing to use a 2018-based SNF market basket to update the PPS payment rates, instead of the 2014-based SNF market basket.
  • Section 134 of the Consolidated Appropriations Act, 2021 – New Blood Clotting Factor Exclusion from SNF Consolidated Billing. 
  • Proposal to modify the public reporting of SNF quality measures as well as seeking comment on two Requests for Information (RFI):
  • Closing the Health Equity Gap – RFI
  • Skilled Nursing Facility (SNF) Healthcare-Associated Infections (HAI) Requiring Hospitalization Measure
  • COVID-19 Vaccination Coverage among Healthcare Personnel (HCP) Measure
  • Transfer of Health (TOH) Information to the Patient-PAC Quality Measure
  • Public Reporting of Quality Measures with Fewer than Standard Numbers of Quarters Due to COVID-19 Public Health Emergency (PHE) Exemptions
  • Fast Healthcare Interoperability Resources (FHIR) in support of Digital Quality Measurement in Quality Reporting Programs – RFI
  • Skilled Nursing Facility Value-Based Purchasing (SNF VBP) Program:
  • Proposal to suppress the SNF readmission measure in the SNF VBP Program
  • Proposal to expand the SNF VBP program and apply up to ten measures with respect to payments beginning in FY 2024, which may include measures of functional status, patient safety, care coordination, or patient experience
    • Also considering expanding measures that already require for Long-Term Care Facilities (LTCFs), which include both SNFs and nursing facilities (NFs), to collect and report under other initiatives such as Nursing Home Compare.  Approximately 94 percent of LTCFs are dually certified as both a SNF and NF, and the vast majority of LTCF residents are also Medicare beneficiaries. The expanded SNF VBP measure set would assess the quality of care that LTCFs provide to all LTCF residents, regardless of payer, as it would best represent the quality of care provided to all Medicare beneficiaries in the facility.

This proposed rule is slated for publication in the Federal Register on April 15, 2021.  The unpublished version (203 pages) is available for your review.  CMS will accept stakeholder comments until June 7, 2021.

This is definitely a proposed rule that should be reviewed by all SNF/LTC providers.  Pull your team together for this review and submit your comments to CMS before June 7th so your voice is heard.