Nursing facility services are the second-largest category of Medicaid spending after hospital services, totaling $56.7 billion in fiscal year 2016. In 2017, Medicaid was the primary payer for 62 percent of nursing facility residents nationally.
This presentation reviews the methods that states use to pay for nursing facilities based on MACPAC’s review of state fee-for-service payment policies, noting that most Medicaid nursing facility payments are base payments for services, which are typically paid according to a per diem—that is, daily—rate. However, the use of supplemental payments for nursing facilities is growing, particularly for government-owned facilities. The presentation concludes by discussing the implications of upcoming changes to Medicare payment policy and highlighting potential areas for future Commission work.