Update on Possible Medicaid Changes (SNF/AL)

As Congress and the Trump administration work to identify significant savings in the federal budget, two proposals – one from the Centers for Medicare and Medicaid Services (CMS) and one from the U.S. House of Representatives – would significantly impact the funding Michigan’s skilled nursing facility residents receive through Medicaid.

Proposed changes include: 

◼️Freezing the provider tax and changing non-uniform provider tax programs.

The reconciliation bill includes a requirement that any Medicaid provider tax program be “generally redistributive.” The bill appears to seek greater uniformity in Medicaid provider tax rates. It’s likely that this will invalidate Michigan’s current provider tax tier system because Michigan’s tier system leads to variable rates among providers. Michigan’s tier system allows for a lower tax amount for facilities with fewer than 40 beds – the majority of which are located in underserved and often rural communities. This conflicts with the newly proposed provider tax requirements. The reconciliation bill and the CMS proposed rule both allow for a transition period for provider tax programs that are out of compliance. Work is already underway to ensure that we get a strong, workable transition period so facilities can adjust to a new system, if needed. 

◼️Changing Medicaid retroactive eligibility from 90 to 30 days.

For Medicaid eligibility, current law requires states to provide Medicaid coverage for qualified medical expenses incurred for up to 90 days prior to the date of application for coverage. The House reconciliation bill reduces this retroactive eligibility to 30 days. This change could put nursing facilities at risk of absorbing costs beyond 30 days if the often-complex Medicaid application process is delayed due to a patient’s inability to produce certain documents, data or meet other requirements. 

◼️10-year delay of the staffing mandate.

On a positive note, the House reconciliation bill includes a provision that would delay the skilled nursing staffing federal mandate for 10 years.

The U.S. Senate is currently considering the reconciliation bill. They will look at potential changes to language and policy. HCAM will continue to advocate for specific policy changes that benefit the sector. 

CMS Updates SNF Billing Guidance for Part D Drug Coverage (SNF)

The Centers for Medicare and Medicaid Services (CMS) recently updated the SNF Billing Reference educational tool to help billers identify where to submit claims when prescription drugs are furnished during a SNF short- or long-stay.  

During a SNF Part A stay, drugs prescribed for a Part D-enrolled patient aren’t covered by Part D if Part A or B can pay for them; SNFs should avoid submitting claims to Part D plans in these situations. CMS is updating the guidance in response to a recent Office of Inspector General report that found that Medicare Part D improperly paid for drugs during Part A SNF stays. 

It’s important for SNFs to know when to bill a patient’s prescription drugs to Part A, instead of their Part D drug plan, to prevent improper payments: 

• Drugs prescribed for a Part D-enrolled patient aren’t covered by Part D if Part A or B can pay for them. 
• Part A covers drugs and biologicals ordinarily provided by SNFs for the patient’s care and treatment. 
• Part A covers a limited supply of drugs to use outside a SNF if it’s medically necessary to help a patient leave the facility and is required until they can get a continuing supply. 

Medicare drug plan (Part D) coverage may be available to a Part D patient who’s exhausted their Part A inpatient stay benefit but remains in that inpatient setting, if the drug would otherwise be covered under Part D. Medicare Prescription Drug Benefit Manual, Chapter 6​, section 20.2.1 has more information.