HHS has released some details about the previously announced $2 billion incentive payment program for skilled nursing facilities and nursing homes.  For a facility to be eligible for payment, they must pass two gateway qualifications on both their rates of infections and rate of mortality.

• The non-admission COVID infection rate must be below the rate of infection in their county of residence.
• The nursing home’s rate of COVID deaths among residents who acquired the virus within the nursing home must be below a “nationally established performance threshold for mortality among nursing home residents infected with COVID.” (It is not clear how this national rate will be determined and/or if it will change each month or remain static once established) Failure to pass this gateway disqualifies a nursing home from receiving any incentive payment for that month.

All nursing homes who make it past both gateways will be eligible to receive an incentive payment based upon their performance on the following two measures:

1. Infection Measure (80% of incentive payment dollars): The infection measure will be calculate by taking the total number of non-admission COVID infections divided by their total number of resident-weeks reported in NHSN(used to “scale up” for the nursing home’s patient volume). This rate will be compared to the county infection rate.
2. Mortality Measure (20% of incentive payment dollars): This measure will be assessed for those nursing homes who have at least one non-admission COVID infection and will be risk-adjusted with “relevant health and demographic data (e.g. number of co-morbidities). It will also use NHSN data including:
   1. Total number of COVID deaths resulting from in-facility infections
   2. Total number of non-admission infections. This will include infected residents from the performance period as well as several weeks prior to the performance period. HHS will reach out to nursing homes with at least one COVID death during the performance period and whose residents represent a mix of infection sources (e.g. nursing home acquired and admitted with COVID) to ascertain how many of the residents who died acquired COVID while in the nursing home.

Through this program, up to $400 million in incentive payments will be distributed each month (October 2020 – January 2021). HHS has indicated that total payments issued may “actually be lower, depending on the number of facilities that qualify and the overall level of performance.” An additional $400 million will be distributed at the end of the program based upon an “aggregate performance period” reflecting a nursing home’s performance for all four months of the program. This final incentive payment could help providers who have a single “bad” month. While it is not clear in the information provided by HHS, based upon our conversations with HHS, we believe their intent is to provide larger incentive payments to those who have better performance than their eligible peers similar to other program like the SNF Value Based Payment Program. In other words, if a county’s infection rate is 20% but Nursing Home A has kept their rate to 10% and Nursing Home B has a rate of 15%, then Nursing Home A would receive a greater share of the incentive payment pool.

An additional $400 million will be available for distribution based upon a nursing homes’ performance on these measures over the entire 4-month aggregate performance period. Monthly performance periods will run September – December 2020. HHS has not specified whether the performance period will reflect a calendar month or another four-week period. Tentatively, incentive payments will be issued in the month following the performance period with a final aggregate incentive payment to be issued in February 2021. Also, the data will be audited one month after payments are issued.

For more details, please visit the Provider Relief Fund website and scroll down to the Allocation for Skilled Nursing Facilities and Nursing Home section and click on the How is the $2 billion incentive payment to skilled nursing facilities and nursing homes being determined.

Questions?

Contact: 

David Carter | Director, Health Care Finance & Policy

C 360.888.5702