FY 2023 proposed rule for skilled nursing facilities would cut payments to offset new payment model

The Centers for Medicare & Medicaid Services yesterday issued a proposed rule for fiscal year 2023 for the skilled nursing facility prospective payment system, which would decrease aggregate Medicare spending by $320 million compared with FY 2022. 

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

CMS also proposes to adopt one new quality measure for the SNF Quality Reporting Program that assesses the rate of influenza vaccination coverage among health care personnel; and require SNFs to begin reporting next Oct. 1 on certain measures and patient data that were delayed due to the COVID-19 public health emergency. 

In addition, the SNF Value-based Purchasing program would adopt two new quality measures starting with the FY 2026 program year and one with the FY 2027 program year; update the scoring methodology used to determine payment adjustments; and continue last year’s measure suppression policy. CMS also requests feedback 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 one year, CMS solicits input on necessary staffing levels to augment its research on the optimal level and type of nursing home staffing needs. 

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