Minimum Data Set (MDS) submissions are about to become a lot more complicated for skilled nursing facilities (SNFs), as the Centers for Medicare & Medicaid Services (CMS) places greater emphasis on the accuracy and timeliness of quality reporting while tightening the MDS reporting window in its final payment rule.

Under the FY 2027 SNF Final Rule, CMS is shortening the MDS reporting window from roughly four and a half months to approximately 45 days after the end of each quarter.

While the change will affect the FY 2029 Quality Reporting Program (QRP) payment determination, SNFs will begin collecting data under the new timeline in January 2027. That gives providers just months to prepare their workflows, staffing and quality-control processes for a faster-paced reporting environment – and underscores CMS’ broader push to ensure that MDS data more accurately reflects the quality of care delivered to residents.

Important changes contained in the latest rule released on July 31 to the SNF QRP means SNFs should use the lead time to strengthen their processes, as missing required assessments, incomplete data elements or even excessive “dashes” missing required MDS elements can affect QRP compliance and potentially trigger a 2% reduction in the annual payment update. 

“For purposes of the QRP quality measure, they don’t want to see dashes,” Pat Newberry, a clinical reimbursement consultant, said during a webinar on the 2027 SNF final rule sponsored by Simple.

Also, providers should keep in mind that failing to complete a required Prospective Payment System (PPS) end-of-stay assessment can count against the 90% completion threshold, she said. Currently, five-day PPS assessments and applicable Interim Payment Assessments (IPAs) are required for traditional Medicare fee-for-service residents to support payment.

Another notable change is the removal of the two COVID-19 vaccination measures from the QRP: the resident COVID-19 vaccination measure and the healthcare personnel COVID-19 vaccination measure. Beginning October 1, 2026, SNFs will no longer be required to collect the resident vaccination information for QRP purposes, and the healthcare personnel measure will no longer factor into the QRP payment determination.

As for the impact to SNF payments from the latest SNF rule, Joe Price regulatory solutions strategist at Netsmart, noted that the update is relatively straightforward compared with some prior years, with no substantive changes to the PDPM ICD-10 code mappings.

The 2.4% figure represents the overall payment update, while individual facilities may experience different impacts based on factors such as location and wage-index changes, he noted. Rural SNFs are projected to see an average increase of approximately 2.7%, compared with 2.4% for urban facilities.

Importantly, the aggregate payment estimate does not account for SNF Value-Based Purchasing reductions, which CMS estimates separately at roughly $203.6 million for FY 2027, Price said.

Also, the latest rule reflects that the SNF Value-Based Purchasing (VBP) is becoming increasingly important as CMS expands the number of measures tied to facility performance.

Unlike the SNF Quality Reporting Program, which primarily penalizes facilities for failing to report required information, VBP is a pay-for-performance model whereby CMS withholds 2% of Medicare payments and redistributes funds based on how facilities perform and improve.

The program now includes multiple measures, with additional measures and revised performance standards being phased in over the coming years. Two MDS-based measures – long-stay falls with major injury and discharge function – will also move to the new approximately 45-day submission timeline beginning with FY 2029.

And so, providers should also review their VBP performance reports now and use CMS benchmarks and achievement thresholds to identify areas for improvement.

SNF Risk-Based Surveys

Aside from quality reporting changes putting MDS accuracy front and center, CMS’ new risk-based survey approach for nursing homes, which is scheduled to begin September 8, 2026, will also stress this data. The initiative is designed to recognize high-performing facilities by subjecting qualifying providers to a more focused survey process, with fewer survey activities, a smaller sample, fewer surveyors and potentially less time on site than a traditional survey. 

Importantly, to be eligible for the risk-based survey, CMS will consider other factors beyond a facility’s Five-Star rating. The federal agency will check for a range of factors, including survey history, staffing and Payroll-Based Journal (PBJ) accuracy, MDS validation audit results, health inspection performance, ownership changes and waiver status, said Tara Altenritter, Director, Solution Management at Simple, a Netsmart solution.

Approximately 12% of facilities are expected to qualify initially, and the new approach reinforces the importance of maintaining strong performance across multiple operational and clinical areas, Altenritter said.

Facilities should view risk-based surveys not simply as an opportunity for a shorter survey, but as an incentive to strengthen compliance, staffing data, MDS accuracy, and overall quality performance, she said.

That said, other experts have noted the risk-based survey approach’s limitations.

Lessons from other PAC settings

Nursing homes can also learn from other parts of the post-acute and senior living industry that have already navigated all-payer data and assessment requirements, according to Kelly Keefe, senior director/GM and executive strategist of senior living at Netsmart. Rather than waiting until the 2029 transition, facilities can begin applying those lessons to their current MDS processes.

A key lesson is to start early and build the workflow before the requirement takes effect. Facilities should identify which residents will fall under the expanded skilled-services definition and determine how responsibilities will be shared among admissions, clinical, MDS and billing teams. Expanding the pool of staff who understand the MDS process can also create necessary backups and reduce reliance on a small number of coordinators, she said.

Facilities should also be identifying submission errors, missing records, workflow gaps and instances where clinical documentation does not support MDS coding, Keefe said.