Last week brought good reimbursement news for SNFs after what seemed like years of Medicare bummers: The federal government raises Medicare payments by 1.8 percent in fiscal year 2013.
Even AHCA praised CMS for the news:
“After years of reimbursement volatility, today’s update to Medicare payments is welcome news to skilled nursing providers. AHCA appreciates CMS’ balanced approach to this year’s Medicare payment system after recognizing the many rounds of government reductions the profession has already endured. Stable Medicare funding will help ensure America’s seniors continue to have access to high quality, post-acute care.”
Rejoice! The tides have turned! After the dreaded Oct. 1, 2011, cuts of 11.1% (sorta), and declining state revenues and reimbursement uncertainty, SNFs finally get some good news. Right?
And then the buzz kill.
This analysis from Avalere Health says brace for $65 billion in cumulative Medicare cuts over the next 10 years. There are two main reasons: New rules that reduce the amount Medicare reimburses for bad debt (such as unpaid deductibles and copays), and the "sequestration" cuts (fixed cuts that were part of the congressional budget compromise), which include a 2 percent Medicare reduction.
But wait again, hope returns! The White House has 30 days to submit it's plan for the sequestration cuts to Congress, which opens some hope for a plan that might minimize the effect of cuts on skilled nursing facilities.
The lesson from this churning cycle of hope and despair? SNFs must keep focusing on the basics, despite the highs and lows of Medicare reimbursements. Focus on building quality census. Increase your Medicare census (no matter what, higher Medicare census still means more revenue). Maximize margins to invest in your mission of quality patient care and life experience.
Medicare cuts don't mean the sky is falling. Far from it, in fact; many providers are thriving. Instead of being paralyzed with panic over the things they can't control (moving reimbursement targets), SNFs must continue to take charge of the things that they do control (working faster and smarter to build and maintain quality census).
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