Guidance on Nursing Facility State Plan Payment and Upper Payment Limit Approaches in Medicaid Relying on the Medicare Patient-Driven Payment Model


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Today, the Centers for Medicare & Medicaid Services (CMS) released a state Medicaid director letter (SMDL) that provides states with guidance on nursing facility state plan payment and upper payment limit (UPL) approaches in Medicaid that rely on the Medicare Patient-Driven Payment Model (PDPM). 

This SMDL discusses the differences between Medicare and Medicaid skilled nursing facility benefits, PDPM as a payment system, using PDPM as the UPL demonstration methodology in Medicaid, and other considerations.  This guidance is especially important since CMS will no longer support the Medicare RUGs systems after October 1, 2023.  CMS is available to assist states as Medicare RUGs transition to PDPM.

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