The Medicare Patient Driven Payment Model Increased SNF Payments By 5% In Fiscal Year 2020

The Medicare Patient-Driven Payment Model (PDPM) for skilled nursing facilities (SNFs) increased SNF payments by 5% in fiscal year 2020. The higher spending totaled $1.7 billion. When the Centers for Medicare & Medicaid Services (CMS) implemented PDPM on October 1, 2019, the model was intended to be implemented in a budget-neutral manner. The transition was anticipated to make no changes to aggregate SNF spending. CMS now seeks to recalibrate the parity adjustment it used to achieve budget neutrality under PDPM.

Under PDPM, Medicare payment for short-stay SNF residents is now linked to beneficiary characteristics. Previously payment . . .