Medicare Skilled Nursing Facility (SNF) Payments (CRS Report for Congress)
Premium Purchase PDF for $24.95 (14 pages)
add to cart or
subscribe for unlimited access
Pro Premium subscribers have free access to our full library of CRS reports.
Subscribe today, or
request a demo to learn more.
| Release Date |
Revised July 20, 2016 |
| Report Number |
R42401 |
| Report Type |
Report |
| Authors |
Scott R. Talaga Analyst in Health Care Financing |
| Source Agency |
Congressional Research Service |
| Older Revisions |
-
Premium Revised Nov. 12, 2014 (22 pages, $24.95)
add
-
Premium Aug. 8, 2012 (19 pages, $24.95)
add
|
Summary:
A Medicare skilled nursing facility (SNF) is an institution, or distinct part of an institution (e.g., building, floor, wing), that provides post-acute skilled nursing care and/or skilled rehabilitation services, has in effect a written agreement to transfer patients between one or more hospitals and the SNF, and is certified by Medicare. In general, "skilled" nursing and rehabilitative care are services ordered by a physician that require the skills of professional personnel (i.e., registered nurse, physical therapist) and are provided under the supervision of such personnel. Over 95% of SNFs are within long-term care facilities (or nursing homes).
A Medicare beneficiary is entitled to 100 days of SNF care for each Medicare-covered SNF stay. To be eligible for SNF coverage, a Medicare beneficiary must have been an inpatient of a hospital
for at least 3 consecutive calendar days and transferred to a participating SNF usually within 30 days after discharge from the hospital. Beneficiaries must also receive treatment at the SNF for a condition they were receiving treatment for during their qualifying hospital stay (or for an additional condition that arose while in the SNF). For beneficiaries who meet these requirements, Medicare Part A may provide up to 100 days of coverage for the SNF stay.
Under Medicare Part A, SNFs are reimbursed under a prospective payment system (PPS), which began on July 1, 1998. The SNF PPS provides payment for bed and board, nursing care, therapy services, drugs, durable medical equipment, and certain ancillary services under a bundled per diem "per day" reimbursement amount, rather than Medicare paying for each item or service individually. For the first 20 days of SNF coverage, Medicare beneficiaries have no copayment. Medicare beneficiaries have a daily SNF copayment for the 21st through the 100th day indexed annually at one-eighth (12.5%) of the current Part A deductible. For 2015, the daily copayment is $157.50.
The Medicare SNF benefit has drawn attention due to the rapid increase in SNF expenditures. Medicare fee-for-service (FFS) spending on SNFs totaled $27.6 billion, or roughly 8.0% of total Medicare FFS spending in 2012, and grew at an average annual rate of 8.3% between 2000 and 2012. SNF payment reductions have been recommended by various deficit reduction advocacy groups. Some of the recommendations have included reducing the SNF reimbursement rate and reducing or eliminating Medicare's reimbursement of bad debt from SNF care.
This report describes in further detail the Medicare SNF benefit and its resident population, SNF services, and the SNF PPS. In addition, this report describes recent developments in Medicare SNF payments, such as the Skilled Nursing Facility Value-Based Purchasing Programâa quality-based payment policy change included in the Protecting Access to Medicare Patients Act (PAMA, P.L. 113-93)âas well as congressional and other issues designed to slow the growth of Medicare SNF expenditures.
