MedPAC discusses draft 2018 payment recommendations for post-acute care

The Medicare Payment Advisory Commission this week discussed draft recommendations that would forgo increases in or reduce Medicare payment rates in 2018 for home health agencies, skilled nursing facilities, inpatient rehabilitation facilities and long-term care hospitals, with a final vote slated for January. Citing a 15.6% Medicare fee-for-service margin for HH in 2015, the recommendations would subject HH payments to a 5.0% cut in 2018 and another round of rebasing in 2019 and 2020, in addition to the rebasing authorized by the Affordable Care Act. The recommendations would provide no increase for SNF payments in fiscal years 2018 and 2019. In 2020, the Health and Human Services Secretary would report on the impact of reforms to the SNF payment system and make any further adjustments to more closely align payments and costs. The commissioners also will consider in January whether to include with their final SNF recommendation an estimate of forgone savings from prior recommendations that were not implemented by Congress or the Centers for Medicare & Medicaid Services. For IRFs, the recommendation would reduce FY 2018 payments by 5% due to large fee-for-service margins, which the commission project will increase from 13.9% to 14.3% between 2015 and 2017. The draft LTCH recommendation calls for no update in FY 2018, but no further interventions, in recognition of both lower fee-for-service margins and the transformation already underway due to LTCH site-neutral payment.