CMS proposes 4.1% payment update for SNFs and revise nursing home enforcement authority in FY 2025

The Centers for Medicare & Medicaid Services March 28 issued a proposed rule for fiscal year 2025 for the skilled nursing facility prospective payment system, which would increase aggregate Medicare spending by 4.1% or $1.3 billion compared with FY 2024. This reflects a proposed 2.8% market basket update, a 1.7 percentage-point increase to counter the agency’s market basket error in FY 2023, and a 0.4 percentage-point productivity decrease. 

CMS proposes to revise regulations regarding its nursing home enforcement authority to allow the agency to impose additional financial penalties on facilities where health and safety deficiencies are identified.

While CMS does not propose to adopt or remove any quality measures from the SNF Quality Reporting Program, the agency proposes to adopt and modify certain patient assessment items related to health-related social needs; SNFs would be required to collect and report specific data elements related to living situation, food and utilities beginning with the FY 2027 SNF QRP. CMS also proposes to adopt a data validation process for the SNF QRP beginning the same year.

CMS proposes a number of operational updates to the SNF Value-based Purchasing program, including policies regarding measure removal and review and corrections. The agency also proposes an update to the case mix methodology used to calculate the Total Nurse Staffing measure.

CMS will accept public comments on the proposed rule through May 28.