Proposed FY2023 rule for skilled nursing facilities would reduce payments to compensate for new payment model

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The Centers for Medicare & Medicaid Services yesterday released a proposed fiscal year 2023 rule for the Skilled Nursing Facilities Prospective Payment System, which would reduce overall Medicare spending by $320 million from the fiscal year. 2022.

CMS is proposing a consumption basket of 2.8%, a 1.5 percentage point increase to counter the agency’s consumption basket error in fiscal year 2021 and a productivity drop of 0.4 percentage point, for a net update of 3.9%. In addition, CMS is proposing to offset an increase in overall Medicare payments for fiscal year 2020 under the new SNF PPS, known as the Patient-Oriented Payment Model, by reducing payment rates by 4.6 % ($1.7 billion) in fiscal year 2023.

CMS is also proposing to adopt a new quality measure for the SNF quality reporting program that assesses the rate of influenza vaccination coverage among healthcare workers; and requiring SNFs to begin reporting next October 1 on certain metrics and patient data that have been delayed due to the COVID-19 public health emergency.

In addition, SNF’s value-based purchase program would adopt two new measures of quality starting with the FY 2026 program year and one with the FY 2027 program year; update the scoring methodology used to determine payout adjustments; and continue the policy of removing last year’s measures. CMS is also asking for input on several potential future quality measures and strategies to address health equity.

To help the agency prepare to release a separate proposed rule on minimum staffing levels for nursing homes within a year, CMS is seeking input on the staffing levels needed to increase its research on the optimum level and type of nursing home staffing needs.

CMS will accept public comments on the proposed rule until June 10.