CMS sets sights on future quality, payment initiatives in 2016 SNF PPS proposed rule

In mid-April, CMS released its proposed SNF PPS rule for fiscal year (FY) 2016. Though the rulemaking document is an annual ritual, this year’s iteration, which experts who spoke with HCPro predict will pass largely unaltered, departed from its recent predecessors in one distinct aspect: its preoccupation with long-term projects.

"It was not a … rule like we’ve had in recent years," says Judy Wilhide Brandt, RN, BA, RAC-MT, C-NE, principal at Judy Wilhide MDS Consulting, Inc., in Virginia Beach, Virginia.

In lieu of remedying small-scale, immediate concerns (like FY 2015’s COT OMRA fix), the FY 2016 proposed rule lays the framework for SNF-specific value-based purchasing (VBP) and quality reporting programs (QRP)?two more distant initiatives that, through their ongoing integrations in different settings, promise to reshape long-standing paradigms, business models, and care practices across the care continuum in the coming years.

But despite the unusual foresight of the latest SNF rule, experts say its provisions hold few surprises, as the two far-off programs they detail are products of high-profile legislation passed last year:

• The Improving Medicare Post-Acute Care Transformation (IMPACT) Act of 2014 calls for the phasing in of various quality improvement and reporting initiatives throughout postacute care (PAC), including a SNF QRP. The legislation also requires the creation of standardized reporting metrics that allow for more equitable comparisons of care delivery strategies, patient outcomes, and overall performance across the various PAC settings (i.e., SNFs, home health agencies, inpatient rehabilitation facilities, and long-term care hospitals).
• The Protecting Access to Medicare Act (PAMA) of 2014 added new subsections to the Social Security Act that authorize the establishment of a SNF VBP program beginning in FY 2019, under which value-based incentive payments will be distributed to SNFs based on their performance on designated quality metrics.

Payment update

In addition to these long-term projects, experts say the one major constant of annual CMS rulemaking?the payment update?was also familiar territory this year.

CMS projects that aggregate reimbursement to SNFs will increase by 1.4% ($ 500 million) in FY 2016. The proposed bump would be the result of a 2.6% market basket increase combined with two 0.6% reductions, one stemming from the forecast error adjustment, and the other from the multi-factor productivity adjustment.

But although the anticipated increase is within normal bounds?Brandt says the industry is accustomed to an annual boost between 1% and 2%?Maureen McCarthy, RN, BS, RAC-CT, president and CEO of Celtic Consulting, LLC, in Torrington, Connecticut, had hoped that SNFs would see a higher market basket raise next fiscal year. Although McCarthy says the multi-factor productivity adjustment and the forecast error affect reimbursement rates each year, she says this year’s adjustments may also be intended to fund some of the proposal’s other initiatives that center on improving quality of care and patient satisfaction. Still, McCarthy prefers this strategy over ones that would divest providers after payment was awarded or that would only target certain SNFs.

"It’s the least punitive," she explains. "It’s money we haven’t gotten yet, so it’s easier to lose."

Payroll-based staffing reporting

The other major change addressed in the proposed rule that will actually hit providers next fiscal year is an electronic system for submitting staffing data pulled directly from payrolls, which CMS plans to debut this October for volunteer SNF testing. The so-called payroll-based journal (PBJ) is a response to the Affordable Care Act (ACA)’s call for the introduction of more accountability into the SNF staff reporting sphere by creating a method to electronically submit data on direct care staff (including agency and contract workers). The ACA requires that such a system fulfill the following criteria:

• Culls data that is verifiable and auditable, such as that from payrolls
• Specifies the job classification of each employee (e.g., RN, LPN, licensed vocational nurse, CNA, therapist, or other medical personnel) and the number of care hours each employee category provides per resident day
• Distinguishes data on agency and contract staff from that on SNF employees
• Tracks employee turnover and tenure
• Includes data on resident census and case mix
• Facilitates public reporting on a regular schedule

Although CMS has long been developing a qualifying system and periodically updating the industry about its progress, the FY 2016 proposed rule offers a more comprehensive discussion of how the agency plans to implement these ACA stipulations. Most strikingly, the rule reiterates CMS’ recent announcement that all SNFs will be required to submit data through the PBJ beginning July 1, 2016.

Although this wholesale shift in staff reporting is coming up fast, McCarthy says the details of its execution aren’t yet set in stone. She therefore urges SNFs to parse CMS’ proposals in this domain to bring to light any potential snares, including:

• How the PBJ will consider corporate nurses who aren’t on a facility’s payroll but may perform direct care.
• What documentation will be required to support the new collection system. For example, will the CMS-671 and CMS-672 forms feed the PBJ until CMS develops a more tailored alternative?
• How the PBJ will account for time worked by salaried employees. Although full-time staff are typically thought to spend 40 hours per week on the job, McCarthy says many salaried direct care staff work 50- to 60-hour weeks, meaning a facility could have higher staffing levels at any given time than the size of its workforce would suggest.

Despite these lingering uncertainties, Brandt believes that CMS recognizes the gravity of the industry’s upcoming transition to a much more robust?and complex?reporting mechanism. In turn, she’s optimistic that the agency will implement the new system methodically, accounting for industry feedback and not jeopardizing honest performers.

"I trust that their goal is that it be fair and reliable, so I trust that people who are staffing to acuity are going to be just fine," she says.

Despite Brandt’s confidence in the ability of worthy providers to acclimate to the upcoming shift, Bonnie G. Foster, RN, BSN, MEd, long-term care consultant in Columbia, South Carolina, doesn’t think they should have to. Foster sees the PBJ as a symbol of the government’s misplaced distrust in an industry largely composed of scrupulous providers that are trying their best to field unforeseeable staffing challenges (e.g., last-minute callouts and heavy turnover) as they arise.

But others don’t have such a high view of the SNF provider community. In addition to fulfilling legislative mandates, the government hopes that the PBJ will quell worries expressed by industry stakeholders about the validity of today’s self-reported staffing data?worries that were stoked by an August 2014 New York Times exposé that charged some in the long-term care setting with artificially inflating reported staffing levels to fare better on Nursing Home Compare’s star ratings.

Of course, many providers have denounced these charges. Some, like Brandt, believe that they represent only a small proportion of providers?providers that may soon be exposed through the verifiable PBJ data.

"The people who have been spending their time trying to manipulate the data and … figure out ways to beef up staffing before a survey … all of those tricks are going away if these measures get implemented," Brandt says.

But Foster fears the PBJ could have the reverse effect, driving providers to enlist staff whose titles look the best on paper (or screens) rather than those who are the most qualified. For example, with increasing pressure from CMS and consumer advocates to bump up levels of RN staffing and supervision at SNFs (which will be more easily identifiable in an electronic reporting system), LPNs with years of nursing and management experience may fall by the wayside, Foster explains.

"I don’t want people to put staffing down there to satisfy the system," she says. "That part scares me a lot."

Regardless of her qualms about the forthcoming reporting system, Foster says providers have some work to do to brace for the additional staffing scrutiny ahead.

For example, while SNFs have adopted flexible intake practices to stay competitive in an evolving industry (e.g., admitting new residents late at night and on weekends), Foster says many haven’t synced their staffing schedules with these new patterns, potentially leaving a workforce that is undermanned or underqualified to cope with peak admission periods.

"If you’re going to continue to admit at those strange hours, then you better be sure that all of your staff understand everything," she says.

In addition to improving general staffing strategies, Brandt says providers should focus on understanding the specifics of the forthcoming PBJ.

"People need to read the draft manual on submitting staffing data, and it’s not too early to start preliminary talks about how they’re going to comply," she explains, encouraging providers to begin priming staffing data for the new collection process by identifying the employees who will be responsible for reporting through the system, kick-starting training initiatives, and setting away necessary budget today.

QRP

To satisfy provisions of the IMPACT Act that task CMS with collecting quality data, the agency is proposing to build a SNF QRP that considers the three quality measures outlined in the table below.

Under the QRP, SNFs would be required to submit certain data on these measures beginning in FY 2018, as well as on any other focuses CMS finalizes in future rulemaking. In addition, the IMPACT Act dictates that providers failing to comply with these reporting requirements will be penalized with a 2% reduction in their annual payment update.

These prospective QRP requirements will carry significant changes in SNFs’ approaches to quality improvement. The proposed fall and functional status measures have not yet been approved by the National Quality Forum for SNFs, and the latter measure could see in an additional MDS component: Section GG. This new section, which would prompt SNFs to evaluate the functional abilities and goals of residents at the start and end of care, would also foretell a new required assessment for facilities to complete when a beneficiary is discharged from a Medicare Part A stay but does not leave the facility?a status shift that CMS says affects 30% of SNF residents.

Brandt has encountered some providers that are wary about the prospect of an additional assessment on top of their already heavy documentation load?not to mention the associated data capture, training, and resource distribution changes it could carry. However, she thinks these fears are overstated because much of Section GG is pulled straight from the Continuity Assessment Record and Evaluation (CARE) item set, a tool that’s been in development since the 2005 enactment of the Deficit Reduction Act compelled CMS to examine the consistency of payment incentives across the various Medicare providers. CMS states that the CARE tool, which is an output of this directive, is "designed to standardize assessment of patients’ medical, functional, cognitive, and social support status across acute and post-acute settings." And Brandt says it has long been on the radars of central SNF departments.

"The CARE tool has been around for a long time now, and if you read through [Section GG], it’s what therapy has been doing, maybe in different formats, every time they do an evaluation in the discharge summary," she says, explaining that, consequently, many rehab providers already have the tool in their software and have been collecting data through it for some time.

"The MDS community needs to realize that adding a section to the MDS doesn’t mean that it’s going to add more to the job of the MDS coordinator," she says.

Beyond the new quality considerations CMS has posed, the agency also seeks to redefine the current bounds of the industry’s skin integrity measure. Although SNFs are presently required to submit data on changes in their residents’ skin integrity, this measurement is restricted to the development of stage 1?4 pressure ulcers that occur or worsen during facility stays. CMS is proposing to broaden this reporting criteria for SNFs (and other PAC providers) to include:

• Unstageable pressure ulcers
• Suspected deep tissue injuries
• Stage 1 or 2 pressure ulcers that become unstageable due to slough or eschar (indicating progression to a stage 3 or 4 pressure ulcer) after admission

CMS points out that since SNFs are already required to complete items related to unstageable pressure ulcers in the MDS, the revision would require a change in the way the agency calculates the measure but would not increase the data collection burden for SNFs.

In addition, by capturing more incidences of decline, CMS says these proposed updates?which are backed by a number of experts and the agency’s own data analyses?could potentially reveal a wider range of SNF performance, improving "the ability of the quality measure to discriminate between poor- and high-performing facilities."

Brandt thinks this attempt to better discern the success of pressure ulcer prevention throughout the provider community demonstrates CMS’ overarching proposal strategy: to elevate hard workers and undercut bad actors.

"Facilities that have been sincerely and tirelessly working on achieving the highest quality of care are going to rise to the surface," she says. "There are nursing facilities all over this country that have been … doing what they can to prevent injuries from falls, preventing pressure ulcers, and I think they’re going to shine."

In addition to putting the necessary frameworks in place to highlight today’s top-performing facilities, ­McCarthy says the QRP proposals can serve as a road map for providers on shakier ground to launch targeted quality improvement initiatives.

"I think providers should take a look at what’s going to be reported for 2018 … and then look at those quality metrics within their own organizations," she says, adding that facilities should pay particular attention to the proposed methods of collecting and scoring quality data.

"They have the opportunity to correct some issues before [there’s] mandatory reporting if CMS will allow it," she continues, explaining that the agency is soliciting public comments through the proposed rule on whether to give providers this head start.

However, Brandt cautions facilities to avoid putting too much stock in the formulas for calculating these quality measures until they are finalized.

VBP

In addition to putting the finishing touches on the QRP’s initial aims, CMS is considering another quality-related focus intended to shape future payments dispensed through the setting’s forthcoming VBP program: the SNF 30-day all-cause readmission measure (SNFRM), which CMS specifies would assess the rate of unplanned readmissions among SNF residents that occur within 30 days of discharge from an inpatient hospital. However, McCarthy says CMS has failed to disclose whether the measure would also penalize providers for hospital readmissions that occur within 30 days after discharge from the SNF itself.

To gather preliminary data for the potential introduction of this metric?whose development was first kindled by PAMA?in October 2016, CMS plans to require facilities to report certain rehospitalization rates starting this October.

Beyond the prospect of an imminent reporting start date tied to its contents, Brandt thinks the SNFRM is significant for another reason: It would be calculated using data from claims rather than MDS documentation, an unprecedented move in the SNF quality domain and one that wouldn’t require any additional data collection or submission by providers.

"It’s kind of historic that we’ve finally got our first measure that is not MDS-based," says Brandt, who believes that the financial tie-ins carried by both the VBP and QRP will further undermine bad actors by stripping them of their primary motivation: monetary reward.

"I think the people who are in long-term care for the goal of providing the service of quality care and who are interested in quality outcomes are going to rise to the surface," she says. "I think people who are in long-term care for any other reason are going to be leaving."

Foster is more ambivalent about the financial incentives (and disincentives) that will soon underlie key performance metrics in the sector. She says that although the forthcoming measures?and their monetary drivers?target long-standing industry shortcomings, she thinks they paint with too broad a brush.

"It’s your entire building is doing a good job, or your entire building is not doing a good job," she says.

Foster worries that this stance could penalize facilities that take on the most compromised residents or reward those whose emphasis on producing favorable bodily outcomes jeopardizes the psychosocial health of the individuals they serve.

Today’s strategies for future success

Despite the far-off focuses of CMS’ latest SNF rulemaking, experts warn providers against lapsing into complacency in the absence of more urgent proposals. They stress that the changes, although distant, are likely to become finalized without major revision. Further, the sweeping scope of QRP and VBP demands preparation from providers today to facilitate compliance and operational stability down the road.

To address the spirit of these changes?the facilitation of effective and efficient care?Foster urges SNFs to implement new restorative nursing programs (or modernize existing ones) with an eye to addressing CMS’ focuses, such as functional status and rehospitalization. Foster says this latter quality indicator, in particular, has been an historic pain point in the industry.

"We’re just worried about the people that keep going back and forth to the hospital as [if through] a revolving door," she explains. To combat this issue, Foster says restorative programs should target services that have traditionally landed residents back in the hospital even though SNFs are equipped to render them, such as providing extra hydration through IVs.

Currently, Foster?who has extensive experience helping facilities implement restorative strategies?says many providers are failing to capitalize on the benefits of a formal restorative program, instead opting for one-off interventions (e.g., designating nursing staff to take residents for a walk once or twice a week) and dedicating the bulk of their resources to enriching therapy offerings. Although some experts say that therapy has been gaining priority throughout the industry as an adaptation to today’s influx of patients seeking short-term intensive SNF rehab services, Foster argues that restorative nursing is a more sustainable practice in some respects. For example, she says that Medicare-covered SNF therapy services have federal cost caps, while restorative programs oftentimes have no mandated expiration date.

Thus, Foster urges providers to shift some of their focus to modeling restorative programs after their often more robust therapy counterparts (e.g., by framing the program with concrete, measurable goals). Not only does Foster believe a restorative mindset will align a facility’s practices with large-scale regulatory shifts, but she says it can breed better connectivity between therapy and nursing departments, thereby fostering a unified vision of care.

In order to build a restorative program that can achieve these manifold benefits in time for the implementation of QRP and VBP measures, Foster says providers need to get started soon.

"It’s going to take you a year to get it right," she explains, citing chronic industry shortfalls as barriers to speedy implementation.

In particular, Foster says providers need to strengthen communication with physicians and the families of residents. She believes many rehospitalizations can be attributed to insistence by families that a SNF readmit a resident to the hospital for any change in condition?even one a facility is capable of remedying.

"When nurses call the families to let them know … "Something’s changed in your loved one," families are notorious for saying, ‘We’ll just send them to the hospital,’ and that’s what [SNFs] do," she says.

To combat families’ reflexive panic and facilities’ equally knee-jerk acquiescence, Foster urges SNFs to sit down with partnering physicians to write a concrete strategy for addressing condition changes. The document should list the specific events a facility can handle on its own and detail the procedures it will use to do so. This will arm SNFs and physicians with an official document to assure families that the SNF is well-equipped to stabilize their loved one’s condition after certain adverse events.

But SNFs’ current communication shortfalls aren’t restricted to external stakeholders, according to Foster, who also charges the industry with insufficient education, particularly among frontline staff. In turn, these lapses can trigger subpar care, inaccurate documentation, and high turnover among mismanaged and frustrated employees. For example, Foster says that documentation among a facility’s CNAs can be erratic and inconsistent, especially regarding a given resident’s functional status, which must be captured multiple times each day and can be evaluated very differently by varying frontline staff members.

To begin clearing up disparate clinical understandings, Foster recommends focusing training efforts around the component of the MDS that corresponds to functional status. "If nothing else, just teach Section G," she says?a directive that seems particularly fitting, given the potential implementation of Section GG, which would build on the functional data already captured today.

Beyond ramping up education, Foster proposes an unconventional solution for warding off critical quality lapses: establishing a mentor program that assigns a qualified staff member to remain by each newly admitted resident’s side for the first two days of his or her stay, a period during which Foster believes the lion’s share of adverse incidents occurs.

"Everything bad happens within the first 48 hours of admission," she says, explaining that she’s seen mentor programs targeted to this time frame reduce fall rates.

But before getting too caught up in planning any full-fledged program refurbishments, McCarthy urges providers to take advantage of the public reporting period on the proposed rule?in effect through June 15?to point out to CMS any perceived issues, discrepancies, or oversights (e.g., surrounding the PBJ and SNFRM) that could jeopardize the future success of their facility.

"Providers really should use that opportunity to voice their concerns to CMS on what issues they think may negatively impact them," she explains. "Because once they become public, they become public, and there’s no opportunity to correct the information that’s out there."

In many respects, the proposed rule provides a first glimpse into CMS’ big-picture plans for the industry in the years ahead. Although it glazes over some key nuances of the agency’s potential execution strategy, Brandt is optimistic the proposal will ultimately introduce new, more reliable methods of upholding virtuous SNFs that have been overshadowed in recent years by the industry’s small, yet potent faction of abusers.

"I think that all the good, decent, honest nursing home operators have ever asked for was a fair chance and to be measured realistically on a level playing field, and I think this is a great step in that direction," she says. "I’m excited to see what’s going to happen in our industry in the coming years."

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