The SNF VBP Program is a Centers for Medicare & Medicaid Services (CMS) program that awards skilled nursing facilities (SNFs) with incentive payments based on the quality of care they provide to Medicare beneficiaries, as measured by performance on a measure of hospital readmissions.
In the FY 2023 SNF PPS final rule (pages 47564–47580), CMS adopted two additional measures for use beginning in the FY 2026 SNF VBP Program year: 1) Skilled Nursing Facility Healthcare-Associated Infections (SNF HAI) Requiring Hospitalization measure; and 2) Total Nurse Staffing Hours per Resident Day (Total Nurse Staffing) (including Registered Nurse [RN], Licensed Practical Nurse [LPN], and Nurse Aide hours) measure. CMS also adopted one additional measure for use beginning in the FY 2027 SNF VBP Program year: Discharge to Community (DTC)—Post-Acute Care Measure for SNFs (National Quality Forum [NQF] #3481).
SNF VBP Program Funding
As required by statute, CMS withholds 2% of SNFs’ Medicare fee-for-service (FFS) Part A payments to fund the program. This 2% is referred to as the “withhold”. CMS is then required to redistribute between 50% and 70% of this withhold to SNFs as incentive payments.
CMS redistributes 60% of the withhold to SNFs as incentive payments, and the remaining 40% of the withhold is retained in the Medicare Trust Fund, as finalized in the FY 2018 SNF PPS final rule (pages 36619–36621).