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The Medicare Payment Advisory Commission (MedPAC) held a public meeting on September 6, 2018. Commissioners listened as staff presented on “Aligning Medicare’s statutory and regulatory requirements under a unified payment system for post-acute care.”[1] Specifically, the presentation discussed the need to make level-of-care requirements consistent across post-acute care (PAC) settings under a unified PAC prospective payment system (PPS). The objective of the unified PAC PPS is to “set payments based on patient characteristics, not site of care.”[2] MedPAC envisions that a “common set of requirements . . . [would] apply to all providers.”[3]

In discussing what policies might ensure appropriate PAC use under the unified PAC PPS, MedPAC staff suggested “requiring a three-day stay for PAC to ensure appropriate use.”[4] The presentation highlighted that the three-day hospital stay requirement may be mitigated by allowing observation days to count towards the requirement and allowing accountable care organizations or entities at financial risk to waive the requirement.[5] Even with limited exceptions, MedPAC’s proposal would create a substantial barrier to care for countless Medicare beneficiaries who need post-acute care would not meet an arbitrary three-day hospital stay requirement.

In order to qualify for skilled nursing facility coverage, beneficiaries must have a qualifying three-day inpatient hospital stay. There is currently no similar three-day hospital stay requirement for care at inpatient rehabilitation facilities, long-term care hospitals, or for home health. In fact, Congress specifically removed a prior Part A hospital stay requirement for home health in 1980.[6] Adding a hospital stay requirement now for home health or any other post-hospital care setting is a step back for the Medicare program and beneficiaries.  It is also contrary to health policy goals of avoiding and reducing hospitalization, the most expensive setting for care.

September 13, 2018 – D. Lipschutz


[1] Evan Christman, Aligning Medicare’s statutory and regulatory requirements under a unified payment system for post-acute care, MedPAC (Sept. 6, 2018),
[2] Id.

[3] Id.
[4] Id.
[5] Id.
[6] The Omnibus Reconciliation Act of 1980, Pub. L. No. 96-499. See also Medicare Home Health Coverage is Not a Short-Term, Acute Care Benefit ─ Congress Acted in 1980 to Provide for Longer-Term Coverage, Center for Medicare Advocacy, (last visited Sept. 11, 2018).



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