We know that CMS released the final rule for FY 2014 on the Medicare Program Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities for FY 2014 and we know that the major provisions include the following:

1. An increase in aggregate payments to SNFs of $470 million, or 1.3 percent, for FY 2014 relative to payments in FY 2013
2. Addition of an item to the Minimum Data Set (MDS) to record the number of distinct calendar days of therapy provided by all the rehabilitation disciplines to a beneficiary over the seven-day look-back period to ensure accuracy in case-mix assignment and payment
3. New requirements to report co-treatment minutes in section O on the MDS

However, there is still much uncertainty as to what SNF providers may experience in the times ahead.  On August 2^nd, the Ways and Means Committee released draft legislation of the President’s proposals to strengthen Medicare. This followed the release of the post-acute care stakeholder letter that the Senate Finance Committee, working jointly with the House Ways and Means Committee released in June addressed to post-acute care PAC) stakeholders that asks for reform ideas to be submitted to their committees.  This letter states the committees’ goal is to “ensure that Medicare beneficiaries receive the right post acute care, in the right setting at the right time with the highest level of quality and that taxpayers and beneficiaries are paying the right amount for the care that is delivered.”  The committees are looking for information and ideas on the types of long-term PAC reforms that will help advance the goal of improving patient quality of care and improving care transitions, while rationalizing payment systems and improving program efficiency.  The letter gives some specific ideas to react to as well as asking for comments on general reforms that have been proposed in the President’s budget, and from other sources such as the Bipartisan Policy Center.

The draft legislative text released on August 2 by the Ways and Means Committee can be found at www.waysandmeans.house.gov/entitlementreform. These latest legislative proposals mirror proposals on post-acute care (PAC) that were put forth by President Obama in his FY2014 Budget as well as discussions by Simpson-Bowles and the Bipartisan Policy Commission. The draft specifically addresses the following changes to PAC:

1. Reducing market basket updates for home health agencies (HHAs), skilled nursing facilities (SNFs), inpatient rehabilitation facilities (IRFs) and long-term care hospitals (LTCHs)
2. Creating site neutral payments between IRFs and SNFs for certain procedures
3. Modifying the criteria required for IRF status (the so-called “75 percent rule”)
4. Establishing a SNF readmissions program
5. Creating PAC bundled payments

Most likely, House and Senate committees will consider proposals in the early fall, perhaps hold hearings, and then include reform in either a bill that fixes the SGR or have separate PAC reform legislation.  Either way, there is a risk that reform to our sector is included with cuts to our sector.  Additionally, therapy cap legislation could be wrapped up into the SGR fix or maybe be placed in another vehicle.  We face the risk of cuts each year.

So, while this October may seem mild when compared with the changes we faced in past Medicare fiscal year payment rules, as leaders in the PAC sector, we cannot lose sight of the ever-changing environment of rules, regulations and payment initiatives we work within.  I challenge everybody to stay alert and take all opportunity to work with your provider organizations and legislators to voice your concerns and ideas for reform!