SNF FY2019 Final Payment Rule

SNF FY2019 Final Payment Rule: CMS has released its finalized FY 2019 skilled nursing facility payment rule, to be effective 10/1/19.  As anticipated, this will include the new Patient-Driven Payment Model (PDPM) replacing the Resource Utilization Group, Version IV (RUG-IV).  The new rule is intended to simplify and reduce reporting costs and to result in a net increase of $820M in funding for SNFs.  Therapy payments will be based on the complexity of patients’ clinical needs, and not the volume of hours provided.  PDPM adjusts Medicare payments based on each aspect of a resident’s care, such as Non-Therapy Ancillaries (NTAs), items and services not related to the provision of therapy, including drugs and medical supplies, thereby more accurately addressing costs associated with medically complex patients.  PDPM will include a 25% cap on group and concurrent therapy services, incentivizing care that meets individualized needs.  Information on training and education resources and opportunities associated with implementing the PDPM will be available on the CMS website at  In addition to PDPM, the final rule make certain modifications to the SNF Value-Based Purchasing Program (VBP) and the SNF Quality Reporting Program (QRP).  The final rule can be downloaded from the Federal Register at:

NY Rollover Audits: It has come to our attention that NY OMIG has been recouping from skilled nursing facilities on rollover audits based on audits that pre-date 3/9/16, the effective date of the Universal Settlement. Such recoupments may be barred by the Universal Settlement. We are challenging OMIG’s right to such recoupments. If you believe you may be affected by any such rollover audits, please contact us.

NY SNF Bed Need: At the July 19th meeting of the New York State Public Health and Health Planning Council's Establishment and Project Review Committee meeting, Charlie Abel stated that the Department will soon be promulgating revised bed need methodology.  He indicated that taking beds out of the system as has been practice with certain applications in recent years may not make as much sense going forward as we come toward a “trough” of demand across the State, as he put it.  Mr. Abel indicated that at a facility it viewed as performing well, a 90% utilization rate would not be viewed as under-utilized.  We read this to mean that this is an opportune time to consider the Department’s view as a softening on bed capacity in the State, and therefore you should consider how your facility might be affected.  Please contact us to discuss this further.

CMS SNF Star Rating Reductions: Several nursing homes have been downgraded on their CMS star-rating since the July 2018 implementation of new measures regarding staffing. CMS had previously warned that “Nursing homes reporting 7 or more days in a quarter with no RN hours will receive a one-star rating in the staffing domain, which will drop their overall (composite) star rating by one star for a quarter,” Facilities need to make sure that not only are they properly staffed but they are properly entering their data in the payroll-based system,

Proposed Changes for the 2019 Physician Fee Schedule and Telehealth: In July, CMS proposed its changes for the 2019 Physician Fee Schedule.  Included are efforts to simplify and reduce documentation and reporting requirements on physicians, reduce supervision of radiologist assistants for diagnostic tests, reduce out of pocket costs for medicines received in a doctor's office covered by Part B, and expansion of eligible reimbursement for telehealth services.  The latter change specifically includes:

  • Paying clinicians for virtual check-ins – brief, non-face-to-face appointments via communications technology;
  • Paying clinicians for evaluation of patient-submitted photos; and
  • Expanding Medicare-covered telehealth services to include prolonged preventive services.

The federal government currently only covers more expansive telemedicine services in rural skilled nursing facilities but expansion to non-rural settings seems simply a matter of time.  However, the proposed rule would cover “virtual check-ins” — which would include phone conversations, e-mail, or texts sent through a patient portal — with nursing home medical directors, primary care physicians, and other doctors or nurse practitioners.