HHS Aims to Improve Safety and Quality in Nursing Homes

According to an April 11 press release, the Centers for Medicare & Medicaid Services (CMS) issued its fiscal year (FY) 2023 Skilled Nursing Facilities Prospective Payment System (SNF PPS) proposed rule. The rule includes a request for public feedback on how staffing in nursing homes and health equity improvements could lead to improved health outcomes.

The release states that “The proposed rule builds upon the Biden-Harris Administration’s commitment to advance health equity, drive high-quality person-centered care, and promote sustainability of its programs. The rule is an important step in fulfilling its goal to protect Medicare skilled nursing facility (SNF) residents and staff by improving the safety and quality of care of the nation’s SNFs (commonly referred to as nursing homes). The SNF PPS provides Medicare payments to over 15,000 nursing homes, serving more than 1.5 million people. Medicare spending to nursing homes is projected to be approximately $35 billion in FY 2022. Through the SNF PPS proposed rule, CMS is continuing its work to transform the SNF payment system to a more patient-centered model by making payments based on the needs of the whole patient, rather than focusing on the volume of certain services the patient receives.”

In the SNF PPS proposed rule, CMS is asking for input to help establish minimum staffing requirements and the feedback provided will be used in a new research study from CMS to determine the ideal level and type of nursing home staffing needs. The agency expects to issue proposed rules on minimum staffing requirements for nursing homes in the next year.

Additionally, CMS is asking for stakeholder input on a measure that would look at staff turnover levels in nursing homes. The input will possibly be included in CMS’ SNF Value-Based Purchasing (VBP) Program that rewards facilities with incentive payments based on the quality of care provided to individuals with Medicare.

That said, “The proposed rule also proposes the adoption of 3 new measures into the SNF VBP Program:

• The Skilled Nursing Facility Healthcare Associated Infections Requiring Hospitalization (SNF HAI) is an outcome measure that assesses SNF performance on infection prevention and management.
• The Total Nursing Hours per Resident Day is a structural measure that uses auditable electronic data to calculate total nursing hours per resident each day.
• The Adoption of the Discharge to Community – Post Acute Care Measure for SNFs (DTC) is an outcome measure that assesses the rate of successful discharges to community from a SNF setting.”

Moreover, CMS is requesting stakeholder feedback on the role health equity plays in improving health outcomes and the quality of care in nursing homes. Particularly, the agency is looking for comments on how to organize or categorize measures in nursing home quality reporting programs regarding indicators of social risk.

“CMS is proposing a 3.9 percent, or $1.4 billion, update to the payment rates for nursing homes, which is based on a 2.8 percent SNF market basket update plus a 1.5 percentage point market basket forecast error adjustment and less a 0.4 percentage point productivity adjustment,” the release continues. “The proposed rule also contains a proposed adjustment to payment rates as the result of the transition to the SNF payment case-mix classification model—the Patient Driven Payment Model (PDPM) that went into effect on October 1, 2019. When finalizing the PDPM, CMS also stated that the transition to PDPM would not result in an increase or decrease in aggregate SNF spending. Since PDPM implementation, CMS’ data analysis has shown an unintended increase in payments. Therefore, CMS is proposing to adjust SNF payment rates downward by 4.6 percent, or $1.7 billion, in FY 2023 to achieve budget neutrality with the previous payment system. As a result, the estimated aggregate impact of the payment policies in this proposed rule would be a decrease of approximately $320 million in Medicare Part A payments to SNFs in FY 2023 compared to FY 2022.”