Skilled Nursing Facility PPS

At A Glance

At Issue

On July 29, the Centers for Medicare & Medicaid Services (CMS) issued the fiscal year (FY) 2022 final rule for the skilled nursing facility (SNF) prospective payment system (PPS). Most provisions in the final rule, including the annual payment update, will take effect on Oct. 1. Highlights of the rule are listed under Key Takeaways; a deeper discussion follows this page.

Our Take

We appreciate the relatively streamlined rule, which allows the field to continue to focus on its COVID-19 response, especially in communities currently experiencing surges. We also recognize CMS’ efforts to address the impact of the pandemic through several of its proposals. In particular, we thank CMS for its decision to hold until FY 2023’s rulemaking cycle to propose a budget neutrality recalibration for the FY 2020 implementation of the redesigned SNF PPS case-mix system — the patient-driven payment model (PDPM). Hospital-based SNFs report that the new PDPM framework helped support their fight against COVID-19, which was invaluable in supporting their host hospitals’ pandemic responses. Regarding the two new items adopted for the SNF Quality Reporting Program, AHA agrees that the topics these measures address are important, but the measures themselves are not appropriate for adoption.

Key Resources


Related Resources

Key Takeaways

The final rule:

  • Increases SNF payments by 1.2% ($410 million) in FY 2022.
  • Makes no material changes to the design of the PDPM case-mix system implemented in FY 2020.
  • Updates the ICD-10 mapping used to classify patients under the PDPM framework.
  • Holds on recalibrating the PDPM “parity adjustment” that is designed to ensure budget neutrality under the new model to assist SNFs in meeting the demands of the COVID-19 pandemic until FY 2023.
  • Implements Part A billing exemption for blood clotting factors and related services and items.
  • Adopts two quality measures: 1) COVID-19 vaccination among health care personnel and 2) healthcare-acquired infections.
  • Suppresses performance for the SNF Value-based Purchasing program and assign uniform payment adjustments to all SNFs.

CMS, OIG, and Other Agency Resources

  Adverse Events in Skilled Nursing Facilities: National Incidence Among Medicare Beneficiaries, Office of the Inspector General (March 3, 2014) A recent OIG report examined potentially avoidable adverse events at SNFs as part of a series of studies about hospital adverse eve...

Scanning the Headlines: Skilled Nursing Facility (SNF) PPS

Updated on August 15, 2017 Links to full-text articles are provided where available. For information on obtaining print copies of articles, please call the AHA Resource Center at (312) 422-2050. Cheney, C. (2017, July 24). Post-acute SNF care a source of wasteful healthcare spending,...

Related Resources

Special Bulletin
The Centers for Medicare & Medicaid Services (CMS) April 11 issued its fiscal year (FY) 2023 proposed rule for the skilled nursing facility (SNF)…
Case Studies
Southwestern Vermont Health Care. Bennington, Vermont (SVHC) partners with Dartmouth-Hitchcock Health and is an integrated non-profit health system that…
This Regulatory Advisory summarizes the Centers for Medicare…
AHA raises “substantial concerns” with the prototype payment model that the Centers for Medicare…
Special Bulletin
The Centers for Medicare…
AHA's comments on the CMS’ fiscal year 2022 proposed rule on the SNF prospective payment system.