Lawmakers Unveil Draft Legislation To Reform Post-Acute Care Payments

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By Nathaniel Weixel  

March 18 --Leaders of both the Senate Finance and House Ways and Means committees March 18 unveiled draft legislation designed to strengthen Medicare's post-acute care (PAC) services.

According to the lawmakers, the draft legislation would establish a standardized post-acute assessment tool across PAC provider settings.

The legislation was issued in response to feedback from post-acute care stakeholders.

It also would require hospitals to report patient assessment data gathered prior to discharge, providing important information for the comparison of patient status before and throughout the PAC episode. According to a summary of the bill, the lack of comparable information across PAC settings undermines the ability of policymakers and providers to determine appropriate care settings for patients.

The draft, titled the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act of 2014), was released by Ways and Means Committee Chairman Dave Camp (R-Mich.) and ranking member Sander M. Levin (D-Mich.), along with Finance Committee Chairman Ron Wyden (D-Ore.) and ranking member Orrin G. Hatch (R-Utah).

According to the summary, collecting standardized data will enable Medicare to:

• compare quality across PAC settings;

• improve hospital and PAC discharge planning; and

• use the information to reform PAC payments (via site-neutral or bundled payments or some other reform), while ensuring continued beneficiary access to the most appropriate setting of care.


The lawmakers in a statement said they will work with their colleagues and “experts within the health care community to further improve the legislative draft, with the goal of formally introducing consensus legislation in the future.”

Stakeholder Comments

According to a bill summary, the substantial variation in spending, quality and margins within the post-acute sector provides strong motivation for seeking modernization in this sector.

The groups were responding to a 2013 letter to “key stakeholders“ from former Senate Finance Committee Chairman Max Baucus (D-Mont.) and Camp, asking for ideas on how to strengthen post-acute care services .

According to the lawmakers, “the resounding theme across the more than 70 letters received was the need for standardized post-acute assessment data across Medicare PAC provider settings.”

The lawmakers asked stakeholders to provide information and ideas on the types of reforms that would “help to advance the goal of improving patient quality of care and care transitions, while rationalizing payment systems and improving program efficiency.”

Post-acute care includes recovery in long-term care hospitals (LTCHs), inpatient rehabilitation facilities (IRFs), skilled nursing facilities (SNFs) and home health agencies (HHAs).

Implementation Timeline

The bill would require, beginning in 2016, use of quality data to inform discharge planning while continuing to take into account patient preferences. The bill would also provide for collection of comparable information across PAC settings, so that any future PAC payment reforms would have the data needed to identify and ensure continued patient access to appropriate settings of care.

The collection of standardized data for PAC and other providers would begin by 2019, according to the draft. Collection would begin by Oct. 1, 2018, for SNFs, IRFs and LTCHs and Jan. 1, 2019, for HHAs.

The bill would also require the Medicare Payment Advisory Committee and the Centers for Medicare & Medicaid Services to report to Congress on ideas for a new payment system. Both reports would be due by 2022, according to the draft summary.


To contact the reporter on this story: Nathaniel Weixel in Washington at

To contact the editor responsible for this story: Brian Broderick at

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