Skilled Nursing Facility Prospective Payment System Final Rule Released for FY 2022

The Centers for Medicare & Medicaid Services (CMS) released a final rule to update the Medicare fee-for-service prospective payment system for skilled nursing facilities (SNFs) for fiscal year (FY) 2022, which begins Oct. 1, 2021.

Key provisions of the rule will:

  • Increase the standard federal rate by approximately 1.3% for SNFs that comply with the quality reporting program (QRP) requirements. SNFs that fail to submit data are subject to a 2 percentage point reduction in their annual update.
  • Update the diagnosis code mappings used to classify patients into case-mix groups in the Patient Driven Payment Model system implemented in FY 2021.
  • Establish a new category of exclusions for the SNF Consolidated Billing policy that specifically creates a new category for blood-clotting factors for the treatment of patients with hemophilia and other bleeding disorders and related items and services.
  • Reduce the labor-related share of the federal rate from 71.3% to 70.4%.
  • Update the denominator for the Transfer of Health Information to the Patient – Post-Acute Care measure in the SNF QRP to exclude patients discharged home under the care of a home health or hospice provider and add two new quality measures beginning with the FY 2023 QRP:
    • The SNF Healthcare Associated Infection Requiring Hospitalization measure.    
    • The COVID-19 Vaccination Coverage among Healthcare Personnel measure.
  • Suppress the SNF 30-Day All-cause Readmission Measure for the FY 2022 SNF value-based purchasing program year due to the public health emergency, which significantly impacted the measure and resulting performance scores.

The CMS continues to review input received on the agency’s Requests for Information on Closing the Health Equity gap and the Fast Healthcare Interoperability Resources in support of Digital Quality Measurement in QRPs, aligning where possible with other quality programs.

The MHA will provide SNFs with an updated impact analysis and summary of the final rule soon. Members with questions should contact Vickie Kunz at the MHA.