MedPAC recommends acceleration towards post-acute care PPS

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The Medicare Payment Advisory Commission (MedPAC) Thursday approved a recommendation for Congress to implement a common prospective payment system (PPS) for post-acute care providers by 2021, accelerating the current timeline by more than four years. The IMPACT Act of 2014 authorizes development but not implementation of a common PPS that would replace the separate payment systems for home health, skilled nursing facilities, inpatient rehabilitation facilities and long-term care hospitals. The recommendation reflects the commission’s concerns that the payment reforms in post-acute care settings have been too slow.

The commission’s recommendations include aggregate payment reductions of 5% rather than budget-neutral considerations; concurrent regulatory alignment with the new payment system; and periodic re-weighting and rebasing to update costs and payments.

The commission believes a short three-year transition is realistic, with a provision for providers to bypass the transition as an option. MedPAC is on schedule to include this recommendation in its June report to Congress as it continues its work on this issue in the next 12 months.