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CMS Proposed the Nursing Facility PPS & Hospice Rules for 2021

No healthcare professional including the members of medical billing services can be deemed secondary. The efficient cycle of the well-being of society and financial survival continues running with the support of all stakeholders.  

Skilled nurses being an integral part of the healthcare community cannot be overlooked. Therefore, CMS (The Centers for Medicare and Medicaid Services) has recently proposed skilled nursing facility (SNF) and hospice payment rules for the year 2021.

Rules for Skilled Nursing Facility (SNF) Prospective Payment System (PPS)

CMS has proposed to increase payment rate for SNF by $784 million (taken together) and decrease payment under the Value-Based Payment Program by $199.5 million.

It also projects the market basket by 2.3%, which is got by the market basket increment factor (2.7-0.4)

Rules for Patient-Driven Payment Model (PDPM)

CMS is still rooting for the Patient-Driven Payment Model (PDPM) while keenly monitoring its implementation. It also encourages people to share their views on its execution over the physicians and healthcare patient plan.

They have also provided a list of information that reflects the PDPM and case-mix adjusted federal rates for urban and rural, underprivileged medical facilities. Medical billing outsourcing companies have to consider every new aspect for maximum benefits for SNF. Moreover, as the payment rate is going to increase for QPP, the eligible participants of MIPS have to adjust their reporting measures accordingly.

See more details here – https://www.federalregister.gov/documents/2020/04/15/2020-07875/medicare-program-prospective-payment-system-and-consolidated-billing-for-skilled-nursing-facilities#p-100

Changes in the Wage Index

The hospital inpatient wage data was used in developing a wage index applied to SNFs, and CMS still uses it for the same purpose. 

CMS proposed to revise the federal Office of Management & Budget (OMB) delineations for wage index in the fiscal year 2021. These rules state that around 42% of the SNFs will experience lower wage index value. However, a little over 2% of clinicians will also face a decline in value. After the implementation of these changes, up to 54% of the SNFs would earn higher wage index value, provided they submit appropriate data. This goal can be achieved via consulting medical billing services to save time and effort to optimize performance.

  • CMS also suggests a 1-year transition policy to facilitate implications of these revisions i.e. transition from urban to rural and vice versa
  • The budget neutrality factor will also be applied up to 0.9982
  • The changes are all applicable to non-critical access hospital swing-bed rural hospitals.
  • CMS proposes no changes to the SNF Quality Reporting Program (QRP)
  • CMS plans to utilize the previous data suppression policy for low-volume SNFs and phase one review and correction deadline policy for Nursing Home Compare

SNF Value-Based Purchasing Program

There are no changes in this program. The performance and baseline period will continue to roll to the next year from the previous year. 

The Proposed Rules for Hospice

The new market basket is 2.6%, which comes from 3% -0.4 (required multi-factor productivity adjustment).

Hospice Payment Rates for the labor portion are:

  • Routine Home Care (RHC) — 68.71%
  • Continuous Home Care (CHC) — 68.71%
  • General Inpatient Care (GIP) — 64.01%
  • Inpatient Respite Care (IRC) — 54.13%

Hospice Payment Rates for non-labor portion are:

  • RHC — 31.29%
  • CHC — 31.29%
  • GIP — 35.99%
  • IRC — 45.87%

The Rules for Wage Index

This year, OMB (United States Office of Management and Budget) delineations are still being revised. Consequently, hospices will experience fluctuations in the payment rate therefore, CMS proposes a 5% cap on every wage index value decline. 

  • The appropriate wage index value will be applied based on the geographical region where the beneficiary lives. 
  • The wage index standardization factor is also applied. 
  • The previously settled policies on election statements and addendums will take effect from October 1, 2020.
  • There are no changes in the Hospice Quality Reporting Program (QRP).


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