CMS Issues FY27 SNF Final Payment Rule

The Centers for Medicare and Medicaid Services (CMS) recently issued the final rule for the skilled nursing facility (SNF) prospective payment system (PPS) for fiscal year (FY) 2027. The final rule is virtually the same as the proposed rule issued earlier this year. The rule finalizes a modest 2.4% increase to Medicare Part A rates in FY 2027, which we were expecting and are pleased to see.

AHCA staff are currently reviewing the final rule, but for now, highlights include:

• Payment Rates: The final rule will increase SNF PPS rates by 2.4% – or approximately $883 million – beginning October 1, 2026. This is based on the SNF market basket increase of 3.3%, minus a 0.9% productivity adjustment. This net update will vary geographically.
• SNF Quality Reporting Program (QRP) Updates:
  • The rule finalizes removal of two measures starting in FY 2028: 1) The COVID-19 Vaccination Coverage among Healthcare Personnel measure, and 2) The COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date measure.
  • CMS also finalized a revision to the timeframe for data submission from 4.5 months to approximately 45 days, beginning with the FY 2029 SNF QRP.
  • CMS also finalized a significant expansion of the SNF QRP with additional reporting requirements starting in October 2029. SNFs will need to submit MDS quality information for all residents receiving covered skilled care, regardless of payer, aligning with other post-acute care quality programs. While still a few years away, we’re disappointed to see this provision finalized and will continue to advocate for CMS to get back to the original intent of the QRP.
• SNF Value-Based Purchasing (VBP) Updates:
  • CMS provided estimated performance standards for the FY 2029 and FY 2030 program years to comply with the Program’s statutory notice deadline.
  • The agency finalized an update to the “snapshot dates” for two MDS-based measures (1. DC Function and 2. Major Injury [Long-Stay]) to maintain alignment with the finalized revisions to SNF QRP submission deadlines for MDS assessment data, beginning with FY 2027 data.
• Request for Information on the Patient Driven Payment Model (PDPM): CMS did not provide responses to comments submitted on this RFI. We will continue to work with CMS on understanding the impact of any future payment reforms.

Learn more from the CMS fact sheet and view the final rule in the Federal Register.

Thank you for your continued support.

Please contact John Kane with any questions.