When the U.S. Centers for Medicare & Medicaid Services (CMS) announced it would delay adjustments to the Payment-Driven Payment Model (PDPM) until next year, some in the skilled nursing industry felt they were getting some breathing room.
But Marc Zimmet, president of consulting firm Zimmet Healthcare Services Group, said he believes that delaying the inevitable could result in an even larger rate recalibration in the near future.
Zimmet discussed the topic and others on Wednesday at the company’s annual conference in Mohegan Sun, Conn.
“We see PDPM rates going up as providers get better at capturing and at the end of the day, this is only going to end one way … We’re going to have a bigger recalibration next year, we have to,” Zimmet told Skilled Nursing News Thursday.
“It was not the 5%; it was the way [CMS] did it that I took exception with,” he added. “The entire logic behind it was ill conceived.”
Adjustments were expected to be made to the payment structure after CMS determined that the model increased payments to nursing homes by about 5% in fiscal 2020, for a total gain of $1.7 billion.
The new system for Medicare reimbursement, which was implemented in October 2019, was intended to be budget-neutral, meaning that CMS would not spend more money on PDPM than they had under the Resource Utilization Group (RUG) system.
Zimmet also said the foundation of SNF economics is “broken” and noted during his presentation that federal policy and legislation impacts every state differently.
“Things are so different state-by-state that when laws are being made or rules are being implemented, there has to be some consideration about how it’s going to trickle down to the local and state level,” Zimmet told SNN.
He said there needs to be consideration on how policies and regulations will impact providers at the local level “without mandating and really disadvantaging some operators.”
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