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Medicare’s new reimbursement system for skilled nursing facilities (SNFs), called Patient-Driven Payment Model (PDPM),[1] changed reimbursement rules and the financial incentives for SNFs, effective October 1, 2019. Just one month since implementation, some of the problems that were predicted as a result of PDPM[2] are already being seen.

The former reimbursement system, Resource Utilization Groups (RUGs), largely paid facilities higher rates, the more therapy they billed for. PDPM, on the other hand, pays more if SNFs provide no therapy at all. Public reports on October 1 indicated, and therapy associations report, that thousands of therapists lost their jobs, or had their hours reduced, across the country.

Due to new payment incentives, it is also now clear that SNFs are changing their admissions practices. Facilities that previously denied admissions to people who use ventilators are now actively recruiting ventilator-dependent residents. Unfortunately, the Center has heard two recent stories that indicate that the facilities recruiting people with ventilators are among the poorest quality facilities in the country. A one-star facility that is on the “candidate” list for the Special Focus Facility program announced, through a press release, that it was now providing ventilator care. In another state, a local ombudsman reported that residents at a poor quality SNF told her they were being moved to another floor to make room for ventilators.

A rush of poor quality SNFs to admit people with ventilators is especially troubling. The New York Times reported in September that drug-resistant infections are prevalent, and deadly, for residents in nursing facilities who use ventilators because of insufficient nursing staff and poor infection control practices.[3] The Centers for Medicare & Medicaid Services reports that, each year, infections in nursing facilities are responsible for 150,000 hospitalizations, 388,000 resident deaths, and health care costs between $673 million and $2 billion.[4]

The Center for Medicare Advocacy wants to hear from anyone with information about ventilator patients and care in nursing homes.

Nov. 7, 2019 – T. Edelman

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[1] 83 Fed. Reg. 39162 39183-39265 (Aug. 8, 2018).
[2] See “Potential Impacts of New Medicare Payment Models On Skilled Nursing Facility and Home Health Care” (CMA Alert, Oct. 31, 2019), https://www.medicareadvocacy.org/potential-impacts-of-new-medicare-payment-models-on-skilled-nursing-facility-and-home-health-care/.
[3] “Matt Richtel, Andrew Jacobs, “Nursing Homes Are a Breeding Ground for a Fatal Fungus,” (Sep. 11, 2019), https://www.nytimes.com/2019/09/11/health/nursing-homes-fungus.html?searchResultPosition=1.
[4] 81 Fed. Reg. 68688, 68808 (Oct. 4, 2016) (Final rule), 84 Fed. Reg. 34737, 34746 (Jul. 18, 2019) (Proposed rule) (omitting hospitalization data).

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