May 07, 2019

Fiscal Year 2020 Proposed Rule for Skilled Nursing Facilities

BY Jodi Eyigor

On April 19, Centers for Medicare & Medicaid Services (CMS) released the proposed rule to update fiscal year (FY) 2020 payment rates and policies for skilled nursing facilities (SNFs). This rule proposes changes to aspects of three major components of Medicare payment and quality programs: SNF prospective payment system (PPS), SNF quality reporting program (QRP), and SNF value-based purchasing (VBP) program. The rule is open for public comment with a deadline for comments by 5pm on June 18, 2019.

PPS payment updates

The rule proposes an estimated $887 million increase in aggregate payments in FY 2020 for the SNF PPS based on a 3.0% market basket update minus a 0.5% reduction for multifactor productivity adjustment, yielding an overall 2.5% increase for FY 2020. On the other hand, the rule proposes an estimated $213.6 million reduction in aggregate payments in FY 2020 for the SNF VBP. Additionally, as began in FY 2018, SNFs who fail to submit quality measures data in a given fiscal year will receive a 2.0% reduction of their annual market basket percentage update under the SNF QRP for that fiscal year. The rule also provides rate adjustments and methodologies for the unadjusted federal per diems for urban and rural SNFs, the PDPM case-mix adjusted federal rates and associated indexes for urban and rural SNFs, and the wage index. All rates are applicable to SNFs and non-critical access hospital swing-bed rural hospitals.

PPS administrative presumption

Under SNF PPS, an administrative presumption exists that beneficiaries correctly assigned one of the designated case-mix classifiers on the 5-day Medicare-required assessment are automatically classified as meeting the SNF level of care up to and including the assessment reference date (ARD) for that assessment. Case-mix classifiers are designated on the SNF PPS website and this proposed rule maintains the case-mix classifiers for administrative presumption that were updated in FY 2019 in anticipation of the Patient-Driven Payment Model (PDPM).

Consolidated billing

SNFs are required to submit consolidated Medicare bills that cover most services that a patient could be expected to receive during the course of a Medicare A-covered stay. Consolidated billing excludes a number of individual high-cost, low-probability services, identified by Healthcare Common Procedure Coding System (HCPCS) codes. These services can be classified into four broad categories:

  • chemotherapy items
  • chemotherapy administration services
  • radioisotope services
  • customized prosthetic devices.

The proposed rule invites comments to identify HCPCS codes that may fit into these categories and that satisfy the criteria of high-cost, low-probability.

Group therapy definition

Effective with the implementation of PDPM on October 1, 2019, group therapy will be defined in the SNF Part A setting as “a qualified rehabilitation therapist or therapy assistant treating two to six patients at the same time who are performing the same or similar activities.” This new definition is based on that of the inpatient rehab facility (IRF) setting and differs from the prior definition that stipulated group therapy consisted of exactly four patients. As specified in the FY 2012 rule, SNFs must continue to document justification for the use of group therapy as opposed to other forms of therapy to meet the patient’s stated goals and to attain or maintain the patient’s highest practicable physical, mental and psychosocial well-being.

ICD-10 Code updates

A sub-regulatory process has been proposed for updating ICD-10 codes and mapping. Currently, updates are published by a federal interdepartmental committee each June. Given the importance of ICD-10 codes under PDPM, the proposed rule would allow for ICD-10 code mappings and lists, the GROUPER software and other products related to patient classification and billing to be updated by posts on the PDPM website. These “nonsubstantive” changes would be limited to specific changes that are necessary to maintain consistency with the most current ICD-10 code data set. Changes that go beyond the intention of maintaining consistency with the most current ICD-10 code data would be considered substantive changes and would continue to require notice and comment rulemaking.

Revisions to regulation text

With the implementation of PDPM, the patient assessment schedule drastically changes. The proposed rule aims to reflect these changes by revising language around the PPS schedule and patient assessments and updating text to reflect the new aspects of the PDPM assessment schedule such as the new optional interim payment assessment (IPA), the “initial patient assessment” that replaces the 5-day Medicare-required assessment, and a clarification of the assessment window for this assessment. Under RUG-IV, the 5-day assessment included an additional 3-day grace period within which to complete the assessment. Under PDPM, the 3-day grace period will be incorporated into the assessment window to allow for an overall 8-day assessment window.

Quality Reporting Program (QRP)

As noted above, a 2.0% reduction will be applied to the market basket percentage update for SNFs who fail to submit quality measure data for a given fiscal year. The proposed rule announces the quality measures adopted for FY 2021 to include 8 MDS-based measures and 3 claims-based measures. An additional 3 assessment-based measures and 1 claims-based measure are discussed for future consideration. These measures include:

  • functional maintenance outcomes
  • opioid use and frequency
  • exchange of electronic health information and interoperability
  • health-care associated infections in skilled nursing facility – claims-based

Two process measures have been proposed for FY 2022 to address the transfer of health information, as well as the proposed exclusion of baseline nursing facility residents from the Discharge to Community – Post-Acute Care (PAC) SNF QRP measure. Also beginning in FY 2022, SNFs would be required to collect and submit MDS data on all SNF residents regardless of payer.

QRP SPADEs

Beginning with FY 2022, SNFs will be required to report on additional standard patient assessment data elements (SPADEs) under this proposed rule. The SPADEs include cognitive functioning and mental status data; the Patient Health Questionnaire (PHQ) – 2 to 9; and special services, treatments and interventions data to include chemotherapy, radiation, oxygen therapy, suctioning, tracheostomy, non-invasive mechanical ventilator, invasive mechanical ventilator, IV medications, transfusions, dialysis, IV access, parenteral/IV feeding, feeding tube, mechanically altered diet, therapeutic diet, and high-risk drug classes: use and indication. SPADEs for a medical condition and comorbidity data (pain interference) and impairment data to include hearing and vision have also been proposed. Lastly, the rule proposes to collect data on several social determinants of health to include race, ethnicity, preferred language, interpreter services, health literacy, transportation, and social isolation. Currently submitted through the Quality Improvement and Evaluation System (QIES) Assessment and Submission Processing (ASAP) system, the rule proposes to transition submission of all QRP data to a new internet Quality Improvement and Evaluation System (iQIES) no later than October 1, 2021. Regulation text referring to data submission will be revised to reflect the standardized terminology “CMS designated data submission” and changes will be made via subregulatory processes including website postings, listserv messaging and webinars.

SNF VBP

The SNF 30-Day Potentially Preventable Readmission (SNFPPR) measure is one of two measures designed to assess SNF-patient readmissions to the hospital. The SNFPPR was adopted in the FY 2017 PPS final rule for eventual use in the SNF VBP and measures readmissions to the hospital within 30 days of discharge from the hospital. A second measure, the Potentially Preventable 30-Day Post-Discharge Readmission Measure, is used in the SNF QRP and measures hospital readmissions within 30 days of discharge from the SNF. Though the SNF VBP has not yet transitioned to using the SNPPR measure, the title will be changed to SNF Potentially Preventable Readmissions after Hospital Discharge to better distinguish this measure from the SNF QRP measure. Other updates to SNF VBP in this rule include estimated performance standard rates for FY 2022 and an increase in the payback percentage for FY 2020 to 61.51% of withheld funds from that year.

Reporting on Nursing Home Compare

Proposed additions to Nursing Home Compare include reporting on the SNF QRP measure Drug Regimen Review Conducted with Follow-Up for Identified Issues beginning calendar year (CY) 2020 and adjustments have been made to the SNF VBP reporting of performance scores relative to eligible stays. Additionally, the correction request period for SNF VBP Phase One reporting has been set to 30 days from the date of report issue, rather than the current March 31 deadline.

For additional information, please access the SNF proposed rule and fact sheet. LeadingAge will be submitting comments on this rule prior to the June 18 deadline. If you would like to submit your comments with LeadingAge, please contact Janine Finck-Boyle or Jodi Eyigor.