CMS Proposes FY 2020 Medicare Payment Updates For Post-Acute Care

CMS Proposes FY 2020 Medicare Payment UpdatesRecently proposed rules would boost FY 2020 Medicare payment rates for several post-acute providers, including skilled nursing facilities and hospices.

April showers bring May flowers. But, this year, they are also bringing a slew of new Medicare payment rate proposals, including reimbursement and quality reporting updates for several types of post-acute care providers.

CMS recently proposed three new rules that would update the Medicare payment rates and quality reporting programs for hospices, skilled nursing facilities (SNFs), and inpatient psychiatric facilities.

The proposed rules include the payment rate updates for fiscal year (FY) 2020 and quality reporting modifications, as well as ways new ways to strengthen payment accuracy and the Medicare program.

FY 2020 Hospice Payment Rate Proposed Rule

CMS proposes to increase Medicare payments to hospices by 2.7 percent, or $540 million, in FY 2020.

The payment rate update is based on the proposed FY 2020 hospital market basket increase of 3.2 percent less the multifactor productivity adjustment of 0.5 percentage points.

The Medicare payment boost would also impact the statutory aggregate cap for Medicare hospices, the proposed rule continues. In FY 2020, CMS is considering limiting overall payments per patient made to a hospice annually to $23,993.99.

In addition to payment rate updates, the proposed rule also aims to improve payment accuracy by rebasing the continuous home care (CHC), general inpatient care (GIP), and the inpatient respite care (IRC) per diem payment rates in a budget-neutral manner. The rebasing would more closely align Medicare payments with the costs of providing care, CMS explains.

The proposed rule also contains modifications to election statement requirements that would require hospices to include additional information, as well as a solicitation for comments on the interaction of the hospice benefit and alternative care delivery models.

In terms of the Hospice Quality Reporting Program, CMS is proposing to continue data collection on the measure “Hospice Visits over the Last 7 Days.” However, the agency will not publicly report the measure in FY 2020 to allow for more testing on how the agency will include the information on Hospice Compare.

CMS also proposes to change an exemption from the Consumer Assessment of Healthcare Providers and Systems (CAHPS) Hospice Survey participation requirements.

FY 2020 Skilled Nursing Facilities Prospective Payment System Proposed Rule

Skilled nursing facilities may see a 2.5 percent, or $887 million, increase in FY 2020 compared to the previous year’s Medicare payment rate, the proposed rule for the FY 2020 SNF Prospective Payment System (PPS) states.

The projected increase in payments is based on a 3.0 percent market basket increase factor with a 0.5 percentage point decrease for multifactor productivity adjustment.

On top of higher payments, SNFs will also be subject to a new payment model under the SNF PPS starting October 1, 2019. The Patient Driven Payment Model (PDPM) aims to shift SNFs to value-based reimbursement using ICD-10 codes to classify SNF patients into certain payment groups.

The proposed rule would ensure SNFs have updated ICD-10 code information by developing a sub-regulatory process for making non-substantive changes to the list of ICD-10 codes used to classify patients.

CMS notes that the sub-regulatory process would like policies already in the SNF PPS that make non-substantive updates to the list of Healthcare Common Procedure Coding System (HCPCS) codes that are subject to consolidated billing.

CMS also proposes to align the SNF PPS group therapy definition with other post-acute settings in FY 2020. Specifically, the rule would adopt the definition of group therapy used in the inpatient rehabilitation facilities PPS, which states group therapy consists of two to six patients doing the same or similar activities.

Aligning therapy definitions would improve payment policy consistency across the post-acute care space and create opportunities for site-neutral payments, CMS explains.

For the SNF Value-Based Purchasing Program in FY 2020, CMS proposes to rename a measure to “Skilled Nursing Facility Potentially Preventable Readmissions after Hospital Discharge” measure, update public reporting requirements for SNFs with less than 25 eligible stays during the baseline or performance period, and institute a 30-day deadline for Phase One Review and Correction requests.

The proposed rule would also add two new quality measures to the SNF Quality Reporting Program in FY 2020 to support health information sharing. The rule would also adopt standardized patient assessment data elements.

FY 2020 Inpatient Psychiatric Facilities Payment Rate Proposed Rule

In a recently proposed rule, CMS estimates that Medicare payments to inpatient psychiatric facilities will increase by 1.7 percent, or $75 million, in FY 2020.

The payment boost under the inpatient psychiatric facilities PPS includes a 3.1 percent market basket increase less a 0.5 percentage point productivity adjustment and a 0.75 percentage point regulatory adjustment. CMS would also reduce estimated payments by 0.15 percentage point for the threshold amount update for outlier payments.

If finalized, the rule would also rebase and modify the market basket used to calculate inpatient psychiatric facility payments. The rule would use 2016 instead of 2012 as a base year.

Additionally, CMS proposes to add a new claims-based measure to the Inpatient Psychiatric Facility Quality Reporting Program starting in FY 2020. The measure is “Medication Continuation Following Inpatient Psychiatric Discharge (National Quality Forum #3205).”

CMS opened comment periods for each proposed rule, and stakeholders have until mid-June to submit their thoughts on the payment and quality reporting updates for each provider type.

The agency also recently released the proposed rule for the FY 2020 inpatient rehabilitation facilities payment system, which would boost payments 2.3 percent and start to align the payment system with those of other post-acute care providers.

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