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CHAPTER 6: MEDICARE SKILLED NURSING …

CMS s RAI Version Manual CH 6: MEDICARE SNF PPS Revised November 2005, December 2002 Page 6-1 CHAPTER 6: MEDICARE SKILLED NURSING FACILITY PROSPECTIVE PAYMENT SYSTEM (SNF PPS) Background The Balanced Budget Act of 1997 included the implementation of a MEDICARE Prospective Payment System (PPS) for SKILLED NURSING facilities, consolidated billing, and a number of related changes. The PPS system replaced the retrospective cost-based system for SKILLED NURSING facilities under Part A of the program.

CMS’s RAI Version 2.0 Manual CH 6: Medicare SNF PPS Revised—November 2005, December 2002 Page 6-2 The MDS assessment data is used to calculate the RUG-III Classification necessary for payment.

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