CMS Skilled Nursing Facilities Proposed Rule FY 2022 Summary
By Timothy Mikita, Supervisor, Assurance Services
On April 8, the Centers for Medicare and Medicaid Services (CMS) issued proposed rule CMS 1746-P for fiscal year (FY) 2022 for the skilled nursing facility (SNF) prospective payment system. This proposed rule covers updates to SNF payment rates and proposals for the SNF Quality Reporting Program (QRP) and SNF Value-Based Purchasing Program (VBP), which will have an impact on rates for the period October 1, 2021, through September 30, 2022.
SNF Payment Rates Updates
Per this proposed rule, CMS estimates that there will be an increase in Medicare Part A payments to SNFs for FY 2022 in the amount of $444 million, resulting in a 1.3% percent net increase in payment rates. This is 0.9% less than the final rule issued for FY 2021. The net increase includes a 2.3% SNF market basket update, less a 0.8% forecast error adjustment, along with a 0.2% decrease for a multifactor productivity (MFP) adjustment, combined with a $1.2 million reduction due to the recently proposed blood clotting factors exclusion. The proposed rule includes the rebasing of the SNF market basket from the 2014-based SNF market base to the 2018 market base in order to improve the accuracy of payments. The new blood clotting exclusion factor is intended to decrease Medicare Part A spending but at the same time offset increased Medicare Part B spending by excluding these services from SNF consolidated billing.
SNF Quality Reporting Program Update
SNF QRP is a pay-for-reporting program. Any SNF that does not satisfy the reporting requirements in FY 2022 will be subject to a 2% reduction in its Annual Payment Update (APU). The proposed rule includes two new measures and an update to an existing measure for the QRP, which would begin in FY 2023. The first is an SNF Healthcare-Associated Infections Requiring Hospitalization measure, which is a outcomes measure based on Medicare claim data. The second is the COVID-19 Vaccination Coverage Amount Healthcare Personnel measure, which is a process measure based on data reported by an SNF through the NHSN system. CMS is proposing to update the existing Transfer of Health Information to the Patient – Post Acute Care measure by excluding from the denominator residents discharged home under the care of a home health or hospice provider.
SNF Valued-Base Purchasing Program Update
The Public Health Emergency (PHE) created by COVID-19 affected the measures and results of performance scores of SNFs relating to the VBP program. The proposed rule for FY 2022 will result in performance scores of 0 for all SNFs, ignoring how the SNF performs, based on the previous finalized scoring methodology. This rule will result in a VBP 2% reduction withheld from the Medicare Part A per diem rates, which will be redistributed in the amount of 1.2%, or 60% of the withheld amount, with the exception of the SNFs subject to the low volume adjustment policy.
Other highlights of this proposed rule include an additional category of excluded codes from SNF consolidated billing pertaining to blood clotting factors. CMS is also proposing several changes to the Patient Driven Payment Model (PDPM) ICD-10 code mappings and lists.
The proposed rule is currently open for comments until June 7, 2021. Once all comments are submitted and analyzed, CMS will issue any necessary adjustments.