News, Skilled Nursing Facility

MedPAC sends recommendations for SNF pay cuts and revised PPS to Congress

In the Medicare Payment Advisory Commission’s (MedPAC) final meeting of 2016, the advisory panel considered two key questions:

  • Are Medicare payments for skilled nursing facility (SNF) care adequate?
  • How should Medicare’s payments change for fiscal year 2018?

On Thursday, January 12, the advisory panel submitted their recommended answers to Congress, which suggested the elimination of SNFs’ market basket for 2018 and 2019 and directed the Secretary to revise the industry’s prospective payment system (PPS). Further, the panel recommends a report detailing the effects of the PPS revision be provided to Congress in 2020.

The advisory panel urges PPS reform in an attempt to more closely align Medicare payments and costs. According to MedPAC, Medicare payments to SNFs are currently too high. This anticipated alignment will also, according to determinations from MedPAC’s 2016 final meeting, decrease payments for intensive therapy care and increase payments for medically complex patients.