PDPM Could Create New Challenges for Skilled Nursing, AHCA Says

A newly proposed payment system overhaul for the skilled nursing industry could create new challenges for the sector, according to public comments by trade groups and other stakeholders submitted on the Federal Register.

Namely, the American Health Care Association (AHCA) believes the payment system, as proposed by the Centers for Medicare & Medicaid Services (CMS) in April, will be a major disruption to an industry already reeling with other headwinds.

The comment submission period for the proposed Patient Driven Payment Model ended on Tuesday.


“We understand the challenges CMS is attempting to solve with PDPM,” AHCA President and CEO Mark Parkinson wrote in the comment letter. “However, we believe PDPM could create new challenges without additional simulation and notable refinements. Regarding our concerns, we believe PDPM still would not mitigate access barriers for patients with high non-therapy ancillary service costs.”

The letter listed several comments in order of priority: Moving toward a SNF wage index, consolidated billing, patient-driven payment mode, the SNF Quality Reporting Program (QRP), the SNF Value-Based Purchasing Program (VBP) and a request for information on interoperability.

Complexity, access remain issues


One of the problems with PDPM is that it remains complex, and more could be done to reduce provider burden, AHCA argued. It specifically called out the Interim Payment Assessment proposal as “unnecessarily complicated,” and noted other issues related to diagnostic codes for resident classification and reporting therapy minutes on the discharge Minimum Data Set (MDS).

There are also concerns with system stability and beneficiary access, as CMS appears to have created new beneficiary challenges, at least according to AHCA.

“CMS has proposed PDPM as budget neutral; however AHCA analysis indicates a number of concerns with leakage from the payment system, which could result in underfunding or overpayment,” the comment letter said. “Which could result in unanticipated expenditure growth.”

Other points of concern

The proposed payment framework also omits alignment with crucial policy initiatives like the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act), the Protecting Access to Medicare Act of 2014 SNF Re-hospitalization Value-Based Purchasing Program (SNF-VBP), and the Requirements for Participation (RfP), which Parkinson described as “very troubling.”

AHCA called for CMS to set up a stakeholder work group to engage with the agency on the various issues raised, specifically recommending that CMS imitate the stakeholder engagement process used to transition from cost-based payment to the current Resident Utilization Group-based prospective payment system.

“The Association offers these comments, while direct and assertive, collegially and in the spirit of collaboration,” Parkinson wrote in the letter. “Our tone and the level of detail are intended to convey the Association’s commitment to improving Medicare payment accuracy, beneficiary access and adequacy of payment to ensure high quality care.”

Written by Maggie Flynn

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