On July 27, 2012, CMS released its Medicare skilled nursing facility (SNF) prospective payment system (PPS) update for fiscal year (FY) 2013, which begins October 1, 2012. The notice provides a 1.8% rate update, which reflects a 2.5% market basket increase that is reduced under the Affordable Care Act by 0.7 percentage point multifactor productivity adjustment. CMS estimates that the update will increase overall payments to SNFs in FY 2013 by $670 million compared to FY 2012 levels. The notice also provides an update on CMS activities to monitor the impact on the SNF PPS of certain FY 2012 policy changes involving recalibration of the SNF parity adjustment, reallocation of group therapy time, and changes to the Minimum Data Set (MDS) 3.0 patient assessment instrument. The notice is scheduled to be published in the Federal Register on August 2, 2012.