CMS rule dump: Post-acute care providers get a pay bump, plus a new value-based payment arrangement

Post-acute care providers could see a boost to Medicare payments starting next year, and even a new value-based payment model, as part of a set of new federal proposals.

In a late-Friday rule dump, the Centers for Medicare & Medicaid Services (CMS) proposed both statutory payment bumps as well as some policy changes that are likely to make providers very happy. 

For fiscal 2019, the agency is proposing a $340 million, or 1.8% Medicare reimbursement boost to hospice providers, up from a 1% boost from the previous year. 

Skilled nursing facilities will also see an $850 million increase in Medicare payments thanks to a mandated increase by the 2018 Bipartisan Budget Act. 

Additionally, inpatient psychiatric facilities and rehabilitation facilities are likely to see similar payment increases from the previous year, with a $50 million and $75 million, or a 0.98% and 0.9% respective increases for fiscal year 2019.

Similar to its hospital payment rule, CMS issued a request for information regarding possible revisions to Conditions of Participation to include electronic data sharing requirements. 

RELATED: CMS floats proposal tying medical records sharing to Medicare participation

Other policy changes proposed by CMS include allowing rehabilitation physicians to conduct meetings remotely and loosening of prescriptive documentation requirements. The agency also proposed reducing quality measure reporting for rehab and psychiatric facilities. 

CMS takes another leap into value

In yet another move to reduce provider burden and lower costs, the agency is also planning a new value-based payment arrangement for skilled nursing facilities. The agency proposed a Patient Driven Payment Model, a type of value-based payment arrangement that would tie reimbursements to patient outcomes while also reduce reporting burdens.

Providers and insurers have been asking the agency to make a bigger commitment to value-based arrangements. Lately, private insurers have been launched their own programs as a way to lower costs. 

Under the new CMS model, patients will have a greater opportunity to select facilities with services tailored to their needs, giving patients more choice, a major goal of the Trump-era department. The model, slated for October 2019, is intended to replace the Resident Classification System, a case-mix model, which has had a rocky reputation (PDF) with both providers (PDF) and policy advisers (PDF).

RELATED: Future CMS innovation center initiatives could include outcomes-based drug pricing

"As people face rising healthcare costs in other clinical settings, we need to leverage advances in technology that help to modernize our programs in a way that benefits patients," CMS administrator Seema Verma said in an accompanying statement. 

CMS said the model would reduce administrative spending for nursing facilities by $2 billion over 10 years and would go into effect Oct. 19 if the rule is finalized.

According to the American Hospital Association (PDF), providers spend $39 billion on administrative costs related to regulatory compliance. 

The agency said that when taken together with the recent proposed overhaul of the Meaningful Measures initiative, the proposed policy changes should save providers about four million hours in 2019 and 2020. 

The comment period for the proposals ends June 26 and a final decision on the rules is expected by July.