Skilled Nursing Facilities

CMS has made numerous technical and typographical corrections to its October 4, 2016 final rule revising the requirements that long-term care facilities must meet to participate in the Medicare and Medicaid programs. CMS notes that the corrections are consistent with the policy discussion in the final rule and do not result in substantive policy changes.  

In a clear turnabout from its previous position, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule on June 5, 2017 that would lift the agency’s ban on pre-dispute arbitration agreements in the long term care (LTC) setting. By contrast, less than nine months earlier, CMS prohibited LTC facilities from entering into pre-dispute arbitration agreements with residents, conditioning admission to a facility on the execution of such agreements, or making a resident’s continuing right to remain at a facility contingent upon a post-dispute arbitration agreement.

The industry’s response to the ban was swift and resolute—on October 17, 2016, the American Health Care Association and a group of nursing homes filed a lawsuit in federal court seeking a preliminary and permanent injunction to prevent CMS from enforcing the ban on pre-dispute arbitration agreements. The U.S. District Court for the District of Mississippi granted the request for preliminary injunction on November 7, 2016, stalling enforcement of the final rule’s arbitration provisions.
Continue Reading CMS Reverses Course in Pre-Dispute Arbitration Agreement Ban

CMS is extending the comment period on its May 4, 2017 advance notice of proposed rulemaking (ANPRM) discussing plans to revise the basis for the Medicare skilled nursing facility (SNF) prospective payment system (PPS).  As previously reported, the ANPRM set forth the outline of CMS’s plan to replace the current RUG-IV case-mix classification methodology

CMS has issued its proposed rule to update Medicare skilled nursing facility (SNF) prospective payment system (PPS) rates and policies for FY 2018, while at the same time soliciting comments regarding a forthcoming and potentially ground-breaking proposed rule to replace the SNF PPS RUG-IV case-mix classification methodology, which forms the basis for SNF payment, with the Resident Classification System, Version I (RCS-I), as early as FY 2019.

For nearly ten years, CMS, the Office of Inspector General, and the Medicare Payment Advisory Commission have raised concerns that the current SNF payment system encourages providers to deliver therapy to residents based on financial goals and not patient need.  The RCS-I case-mix model, which was developed during the SNF Payment Models Research initiative, attempts to address those concerns by removing service-based metrics from the SNF PPS and deriving payment, almost exclusively, from objective resident characteristics.  Most notably, the proposed RCS-I case-mix model would:
Continue Reading CMS Simultaneously Releases Proposed Rule to Update SNF PPS for FY 2018 & Advance Notice of Proposed Rulemaking (ANPRM) to Replace RUG-IV Case-Mix Methodology as Early as FY 2019

Using unusually blunt language, the Medicare Payment Advisory Commission (MedPAC) recently noted that it “is increasingly frustrated with the lack of statutory or regulatory action” to lower Medicare skilled nursing facility (SNF) payments and revise the payment system to link payments to patients’ characteristics and costs of care.  It appears, however, that the Centers for

The Medicare Payment Advisory Commission (MedPAC) has released recommendations to Congress regarding how Medicare fee-for-service payment system rates should be adjusted in 2018. One of the focus areas for MedPAC is post-acute care (PAC), which includes skilled nursing facility (SNF), home health agency (HHA), inpatient rehabilitation facility (IRF), and long-term care hospital (LTCH) services.  According to MedPAC, the “unnecessarily high level of spending and the inequity of payments across different types of patients” necessitate changes to both payment levels and overall system design.  MedPAC therefore reiterates its previous recommendation for a uniform Medicare PAC prospective payment system (PPS) that bases payments on patient characteristics; MedPAC believes that transition to the PAC PPS could begin as early as 2021. In the meantime, MedPAC recommends that Congress:
Continue Reading Post-Acute Care Providers Targeted for Cuts in MedPAC’s Latest Report to Congress

 The Government Accountability Office (GAO) has reviewed the Medicare Five-Star Quality Rating System for nursing homes and identified several factors that may prevent consumers from using the website “as an easy way to understand nursing home quality and identify high- and low- performing homes.”  In particular, GAO concluded:

  • The Centers for Medicare & Medicaid Services’

The Government Accountability Office (GAO) recently issued a report highlighting concerns with the public accessibility and reliability of skilled nursing facility (SNF) expenditure data collected by CMS. While CMS has posted raw SNF cost report data in accordance with a statutory mandate, the GAO believes the data’s format, volume, and organization makes it difficult for

The HHS Office of Inspector General (OIG) has issued its FY 2017 Work Plan, which lays out the OIG’s current audit, evaluation, and other legal and investigative priorities. The largest number of new initiatives by far target Medicare Parts A and B, including reviews focusing on the following:
Continue Reading New OIG Investigations to Look at Wide Range of Medicare, Medicaid Services in FY 2017

On September 28, 2016, the Centers for Medicare & Medicaid Services (CMS) released a highly-anticipated final rule to strengthen requirements that long-term care (LTC) facilities must meet to participate in the Medicare and Medicaid programs.  The sweeping rule – more than 700 pages – is intended to improve the safety, quality, and effectiveness of care delivered to facility residents.  According to CMS, the final rule reflects nearly 10,000 public comments on the July 16, 2015 proposed rule.  CMS adopted numerous changes from the proposed rule, including various revisions to staffing and training requirements, care planning rules, infection prevention, and control program provisions.
Continue Reading CMS Finalizes Major Changes to Medicare/Medicaid Requirements for Long-Term Care Facilities

The Centers for Medicare & Medicaid Services (CMS) has released a long-awaited final rule establishing emergency preparedness requirements for Medicare- and Medicaid-participating providers and suppliers to ensure that they can meet the needs of patients and residents during emergency situations, both natural and man-made. According to CMS, the final requirements “establish a comprehensive, consistent, flexible, and dynamic regulatory approach to emergency preparedness and response that incorporates the lessons learned from the past, combined with the proven best practices of the present.”  CMS projects that compliance with the rule will cost $373 million in the first year, with subsequent annual costs of approximately $25 million.

The new requirements apply to 17 provider types (with certain variations): hospitals; critical access hospitals (CAHs); long-term care (LTC) facilities; psychiatric residential treatment facilities; intermediate care facilities for individuals with intellectual disabilities; religious nonmedical health care institutions; transplant centers; hospices; ambulatory surgical centers; Program for the All-inclusive Care for the Elderly (PACE) organizations; home health agencies; comprehensive outpatient rehabilitation facilities; community mental health centers; organ procurement organizations; clinics, rehabilitation, and therapy providers; rural health clinics/federally qualified health clinics; and end-stage renal disease providers.

The sweeping final rule (the advance version spans 651 pages) covers four aspects of emergency preparedness:
Continue Reading CMS Finalizes Emergency Preparedness Requirements for Medicare/Medicaid Providers

The Department of Health and Human Services (HHS) is increasing maximum civil monetary penalty (CMP) amounts applicable to HHS agencies and programs, in compliance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (which was part of the Bipartisan Budget Act of 2015).  The magnitude of the individual CMP increases varies depending on when the specific type of penalty was last adjusted and consequently how large a “catch-up” adjustment is applied.  Increases range from 1% to 150%.  For instance:
Continue Reading HHS Inflation Adjustment Rule Hikes CMPs Across Department Programs

CMS has published its final rule to update Medicare skilled nursing facility (SNF) PPS rates and policies for FY 2017. CMS projects that the final rule will increase overall payments to SNFs by $920 million, or 2.4%, compared to FY 2016 levels (and compared to the $800 million/2.1% increase forecast in the proposed rule). The final update is based on a 2.7% market basket increase that is reduced by a 0.3 percentage point multifactor productivity adjustment.
Continue Reading CMS Adopts Final SNF PPS Rates and Policies for FY 2017

The U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) has issued new guidance to help long-term care facilities comply with anti-discrimination obligations when they administer the Minimum Data Set (MDS) patient assessment tool so that the facilities’ residents receive care in the most integrated setting appropriate to their needs.

Those obligations arise under Section 504 of the Rehabilitation Act (29 U.S.C. § 701 et seq.) (Section 504) and the Americans with Disabilities Act (42 U.S.C. § 12101 et seq.) (ADA), which prohibit long-term care facilities receiving federal financial assistance from discriminating against individuals based on disability.  The unnecessary placement of residents in an inpatient setting when they could live in a more integrated setting may constitute discrimination under Section 504 and the ADA, as interpreted by the U.S. Supreme Court in Olmstead v. L.C., 527 U.S. 581 (1999).

OCR’s guidance, issued May 20, 2016, includes recommendations concerning MDS administration. OCR issued the guidance after finding that long-term care facilities have misinterpreted certain required questions when administering the MDS to their residents, namely – MDS Section Q, questions Q0400, Q0500 and Q0600.  Those questions, as well as others in Section Q of the MDS, are intended to ensure that long-term care facilities provide all residents with the opportunity to learn about home and community-based services.  The guidance sets forth detailed instructions concerning how operators should answer each of the three questions.  According to OCR, proper administration of these questions is critical to assisting residents to receive services in the most integrated setting.
Continue Reading HHS Office of Civil Rights Releases Guidance for Long-Term Care Facilities Using the Minimum Data Set to Facilitate Opportunities to Live in the Most Integrated Setting

The CMS Survey and Certification Group has released its 2016/2017 Nursing Home Action Plan, which details the agency’s strategy for continuing to improve nursing home quality. The plan focuses on five strategies for quality improvement: (1) enhancing consumer awareness and assistance; (2) strengthening survey processes, standards, and training; (3) improving enforcement activities; (4) promoting

CMS has published its proposed rule to update Medicare skilled nursing facility (SNF) PPS rates and policies for FY 2017. CMS projects that the proposed rule would increase overall payments to SNFs by $800 million, or 2.1%, compared to FY 2016 levels. This projected update is based on a proposed 2.6% market basket increase that would be reduced by a 0.5 percentage multifactor productivity adjustment. CMS does not propose making a forecast error correction for FY 2017, since the difference between its FY 2015 estimated market basket index increase (2.5 percentage points) and the actual change in the market basket (2.3 percentage points) did not exceed the 0.5 percentage point threshold to trigger an adjustment.
Continue Reading CMS Releases Proposed Rule to Update SNF PPS Rates and Policies for FY 2017

On May 4, 2016, CMS is publishing a final rule amending fire safety standards applicable to the following types of Medicare- and Medicaid-participating health care facilities: hospitals, critical access hospitals, long-term care facilities, intermediate care facilities for individuals with intellectual disabilities (ICF-IIDs), ambulatory surgery centers (ASCs), hospices that provide inpatient services, religious nonmedical health care institutions, and programs of all-inclusive care for the elderly facilities.  As part of this significant update to the current standards, CMS is adopting the National Fire Protection Association’s (NFPA) 2012 edition of the Life Safety Code (LSC) and provisions of the 2012 edition of the NFPA Health Care Facilities Code.  In addition to promoting patient safety and health, CMS contends that “adopting the 2012 LSC would simplify and modernize the construction and renovation process for affected health care providers and suppliers, reduce compliance-related burdens, and allow for more resources to be used for patient care.”  Nevertheless, CMS estimates that the rule will cost $95 million over 12 years, with $18 million in costs during the first year of implementation, $12 million annually for years 2 and 3 of implementation, and $6 million annually for years 4-12.  The greatest costs are associated with a requirement that high-rise buildings containing health care occupancies to be protected by automatic sprinkler systems; facilities that are not already required to do so will have 12 years from publication to comply with this requirement.

The rule addresses numerous other fire/health safety requirements, including the following:Continue Reading CMS Finalizes Updated Fire Safety Standards for Health Care Facilities

The Department of Justice has created 10 regional Elder Justice Task Forces “to coordinate and enhance efforts to pursue nursing homes that provide grossly substandard care to their residents.”  The Task Forces are comprised of representatives from the U.S. Attorneys’ Offices, state Medicaid Fraud Control Units, state and local prosecutors’ offices, and various agencies that