CMS Clarifies Updates for Skilled Nursing Facilities in FY 2025 Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) held an open door forum Tuesday, which addressed updates outlined in the proposed Skilled Nursing Facility Prospective Payment System rule (SNF PPS) for fiscal year 2025.

Officials discussed payment provisions and market basket updates, along with changes to the Quality Reporting Program (QRP) and the new Social Determinants of Health (SDOH) items. They also discussed the rationale behind the expanded Civil Monetary Penalty (CMP) guidelines.

Payment Provisions and Market Basket updates

CMS Representative John Kane said the proposed rule estimates an aggregate impact of increasing payment rates by approximately 4.1%, or $1.3 billion.


He said the increase is based on factors such as a 2.8% proposed SNF market basket increase, forecast error correction, and productivity adjustments.

Notably, CMS is proposing to update the SNF market basket base year from 2018 to 2022, aiming to enhance payment rate accuracy and appropriateness.

Quality Reporting Program and Social Determinants of Health (SDOH) updates

SNF QRP program coordinator, Heidi Magladry, discussed proposed modifications to the SNF Quality Reporting Program (QRP). The proposed changes include requiring SNFs to collect and submit new SDOH items through the Minimum Data Set (MDS), focusing on living situations, food, and utilities. Additionally, CMS is adopting a validation process for MDS data, aligning with its goal of improving care quality and addressing residents’ social needs.


“We’re proposing SNFs will begin collecting these items on admission beginning October 1, 2025, for the fiscal year 2027,” she said.

Value-Based Purchasing program (VBP) revisions

Regarding SNF Value-Based Purchasing Program (VBP), CMS’ Health Insurance Specialist Christopher Palmer said CMS is proposing operational updates, such as adopting a measure retention and removal policy to ensure program focus on quality metrics. The federal agency is also updating the case-mix methodology for the Total Nurse Staffing measure.

Currently, the program includes eight quality measures derived from various data sources and is a pay-for-performance program. Palmer said there are also minor updates to the SNF VBP program, including measure specifications and numerical value updates using sub-regulatory processes. Additionally, he introduced a new measure removal policy to ensure the program remains focused on the best metrics for assessing SNF quality.

Palmer said the changes align with CMS’ efforts to incentivize quality care in SNFs.

“These technical measure changes include updates to the case mix or risk adjustment methodology, changes in exclusion criteria, and updates required to accommodate changes in the content and availability of assessment data,” he said. “We would still use rulemaking for substantive measure changes, including changes in which the modifications to a measure are so significant that the measure is no longer the same metric.”

Civil Monetary Penalty changes

CMS officials also discussed revisions to CMS’ nursing home enforcement regulations, aiming to enhance accountability and oversight. The proposed changes include allowing more flexible imposition of civil monetary penalties (CMPs) for noncompliance.

The proposal aims to allow both per instance and per day CMPs. Currently, these penalties cannot be imposed for the same survey. Officials said the aim of this change is to give CMS more flexibility in addressing non-compliance that poses risks to resident health and safety.

Another component of the proposal is to allow multiple instance CMPs for the same type of non-compliance within a survey. Presently, CMS can impose only one instance CMP or F-tag deficiency per survey. This change seeks to provide more flexibility in addressing repeated instances of non-compliance and encourage facilities to resolve deficiencies permanently.

“These proposed revisions are not intended to expand the types of deficiencies that [operators] are subject to per diem,” a CMS official said in the call. “CMS would continue to follow the existing criteria for imposing CMPs, including per day or per instance CMPs for noncompliance that occurred prior to the start of the survey.”

The proposed revisions would allow for more consistency in the penalties imposed across the nation and expand the current enforcement to allow for additional CMPs that more closely align with the noncompliance that occurred.

When asked if CMS would consider making some more drastic changes in phases, particularly concerning the Non-Therapy Ancillary (NTA) component of PDPM, Kane said they are still awaiting comments to finalize implementation.

“We are just an information seeking mode, providing some information for folks to react to and get comments about. So we are not at the point of talking about implementation,” he said.

Companies featured in this article: