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Overview of the Post Acute Care Payment Reform Demonstration/Medicare Payment Reform Demonstration
The Deficit Reduction Act (DRA) of 2005 directed the Centers for Medicare & Medicaid Services (CMS) to develop a Medicare Payment Reform Demonstration (PRD) that uses standardized patient information to examine the consistency of payment incentives for Medicare populations treated in various settings. The demonstration includes Acute Care Hospitals and four Post Acute Care settings: Long Term Care Hospitals (LTCHs), Inpatient Rehabilitation Facilities (IRFs), Skilled Nursing Facilities (SNFs), and Home Health Agencies (HHAs).
The demonstration will provide standardized information on patient health and functional status, independent of site of care, and will examine resources and outcomes associated with treatment in each type of setting. This will allow CMS to determine the extent to which similar patients are treated in different settings. Similarly, good information on resource use within each setting is needed to understand differences in patient treatment, outcomes, and current costs of care in order to create appropriate payment reform recommendations.
The PRD was expanded under the Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA) to allow additional providers to participate, particularly those treating medically complex populations, and to authorize CMS to also examine the adequacy of the acute hospital payments for these populations. Recruitment for this second phase of the demonstration is now actively underway.
CMS has contracted with RTI, International to carry out this demonstration. This is the official website for this project.
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