The Issue
Hospital
readmissions not only have the potential for negative physical,
emotional, and psychological impacts on individuals in skilled nursing
care, but also cost the Medicare program billions of dollars.
Preventing
these events whenever possible is beneficial to patients and has been
identified as an opportunity to reduce overall health care system costs
by improving quality. The issue has become a top priority for the
Centers for Medicare & Medicaid Services (CMS) and managed care
programs.
The Program
The Protecting Access to Medicare Act of 2014 (PAMA) required CMS to implement the
Skilled Nursing Facility (SNF) Value-Based Purchasing (VBP) Program, an effort that links Medicare Part A payments to a SNF’s rehospitalization rate.
Starting
October 1, 2018, all SNFs will receive a payment adjustment to
their SNF Medicare Part A claims ranging from a 2 percent cut to
potentially a 1.5 percent increase based on rehospitalization rates in
prior years. CMS will recalculate the payment adjustment annually every
fiscal year (FY) thereafter for the next ten years.
The program works by:
- Calculating
the SNFs rehospitalization rate in the prior year and also the amount
of improvement from two years before using Medicare Claims for only
Medicare Beneficiaries in Fee-For-Service program (e.g. Managed care are
excluded).
- SNFs earning a score based on their rehospitalization rate and amount of improvement.
- CMS
ranking all SNFs based on their score. Top-ranked SNFs may receive an
increase in Medicare payments while the lowest ranked SNFs will receive a
2 percent cut.
NOTE:
While the exact formula that translates VBP scores into a payment
percentage adjustment cannot be finalized until CMS determines the
distribution of scores across the nation, AHCA can obtain a reasonable
estimate of the financial impact for centers through its
LTC Trend Tracker SNF VBP Prediction Tool available to members today.
For more information about the program, visit the CMS
website.