LeadingAge National distributed a critical response to a recent recommendation by the Medicare Payment Advisory Commission (MedPAC) to lower pay rates for skilled nursing facilities. MedPAC criticized some of the Patient-Driven Payment Model policies supported by nursing facilities in a comment letter to the federal government issued last week. MedPAC called a proposed 2.4 percent pay raise as spelled out in the proposed market basket update “unnecessary” with SNFs earning an aggregate Medicare margin of about 11.4 percent – a “high level” that is “more than adequate to accommodate cost growth.” LeadingAge took issue with these assumptions. Nicole Fallon, LeadingAge Vice President of Health Policy and Integrated Services, said nonprofits earn just 2.3 percent on Medicare. She also noted that MedPAC’s analysis only focused on Medicare and does not consider Medicaid. In an interview with McKnight’s Long-Term Care News, Fallon said “Failing to provide sufficient reimbursement places access to these services in jeopardy and denying an increase across the board as MedPAC suggests doesn’t acknowledge the inherent differences in how SNFs operate. Our members provide services until they can’t any more, at which point they shut their doors or get sold off to large chains. MedPAC’s criteria are not optimal for ascertaining the appropriate value of services our members provide.”
