Prepare Now for Major Long-Term Care Reimbursement and Compliance Deadlines

Implementation deadlines for reimbursement and compliance-and-ethics programs are fast approaching for long-term care organizations—marking perhaps the biggest shift in reimbursement, compliance, and supporting operational practices for the industry in recent history.

On October 1, 2019, skilled nursing operators will face a complete overhaul of Medicare reimbursement. Meanwhile, long-term care operators have until November 28, 2019, to shore up any gaps in their compliance-and-ethics programs to avoid negative attention from state surveyors as well as future penalties.

Medicare Reimbursement

In July 2018, the Centers for Medicare and Medicaid Services (CMS) finalized a new classification system: Patient-Driven Payment Model (PDPM). Used under the Skilled Nursing Facility Prospective Payment System, it applies to patients in a covered Part-A stay.

With PDPM, skilled nursing facilities will be reimbursed a diminishing rate from Medicare the longer a Medicare patient remains in the facility.


The new classification system goes into effect on October 1, 2019. 

What It Means

To receive the appropriate reimbursement for each patient, facilities will need to capture more information upon patient admission. This will likely require operational changes to support new efforts in patient coding, acuity, and data management.

CMS has also emphasized the importance of documentation under the new payment system, which means organizations can benefit from being prepared to present accurate and sufficient documentation in case of an audit. To do so, organizations will want to examine their data-collection practices and staff training to avoid costly penalties.

Compliance-and-Ethics Program

In September 2016, CMS released changes to Title 42 of the Code of Federal Regulations (CFR), Part 483, Requirements for States and Long-Term Care Facilities, which created a new compliance requirement for long-term care facilities. There are additional requirements for entities with five or more facilities. 

State surveyors who have historically conducted routine life-safety code surveys will now have the authority to assess organizations’ compliance-and-ethics programs—and to note deficiencies for those organizations unable to demonstrate an effective program.


Beginning on November 28, 2019, all LTC organizations must have an effective compliance-and-ethics program as prescribed by the final regulation.

What It Means

A compliance-and-ethics program that focuses on patient safety and quality won’t be sufficient to meet CMS’ new requirements. According to the final ruling, programs must include all three of the following:

  • Written compliance and ethics standards
  • Policies and procedures designed to minimize the prospect of criminal, civil, and administrative violations
  • Policies and procedures to bolster quality of care

Organizations shouldn’t wait until a surveyor arrives and identifies gaps in their program. Instead, they can benefit from proactively assessing their program, making modifications, and being prepared and able to demonstrate an effective program.

We’re Here to Help

For help adopting these changes to Medicaid reimbursement and regulatory compliance, contact your Moss Adams professional.

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