Published May 18, 2020

A New CMS Waiver Helps Hospitals “Swing” Over Patient Discharge Woes

Due to COVID-19, there have been outcries from hospitals and state government officials for the Centers for Medicare & Medicaid Services (CMS) to reimburse hospitals that are caring for post-acute patients that do not meet acute care criteria. Enter enhanced opportunities to use swing beds. On May 11, 2020, CMS published additional blanket waivers to allow all Medicare-enrolled hospitals, except psychiatric and long-term care hospitals, to provide swing bed services and bill under the skilled nursing facility (SNF) prospective payment system (PPS).

What’s a swing bed?

Since the 1960s, the swing bed program has been an opportunity afforded only to small, rural hospitals. Swing beds allow a hospital to “swing” a bed from acute to post-acute care services similar to those furnished in a SNF. This type of care arrangement was initially created to financially bolster rural hospitals with less than 100 beds and better serve patients when SNF services were not available.

There is a mutual benefit to both patient and hospital for providing swing bed services. High-acuity patients receive high-quality post-acute care, such as respiratory support and wound care. Patients are also integrated with the referring hospital, allowing seamless transition of care and a heightened focus on a successful discharge to home.

For hospitals, patient discharge from acute care to a swing bed is seamless—the patient may even remain in the same room. This contributes to improved outcomes and patient satisfaction, as well as a reduction in readmissions.

There is also financial benefit to having a swing bed program. In addition to being able to bill for these services, hospitals can avoid reimbursement penalties of the Medicare post-acute care transfer (PACT) policy. The PACT policy “dings” hospital diagnosis-related group (DRG) reimbursement if a patient’s hospital length-of-stay is shorter than the national average, and the patient is discharged to a qualifying post-acute setting, such as a SNF or home health agency. However, swing beds are not included in the qualifying post-acute setting definition; so, through a swing bed transfer, hospitals have the opportunity to keep the full DRG payment.

New CMS Waiver

This waiver comes at a paramount time as SNFs are not required to admit COVID-19 positive patients, which creates a challenge in securing a SNF transfer. Furthermore, SNFs have become overwhelmed with virus outbreaks in their population, as well as having to evacuate those patients to costly emergency departments.

To be eligible for swing beds, hospitals must comply with all other hospital conditions of participation and the special requirements for hospital providers of swing bed services at 42 CFR § 482.58, which include resident assessments, specialized rehabilitative services, patient rights, and social services. Swing bed usage also must be consistent with the state’s emergency preparedness or pandemic plan. A hospital cannot bill for SNF PPS payment using swing beds when patients receive acute level care or continued acute care at any time while the waiver is in effect.

To add swing bed services for the duration of the COVID-19 public health emergency (PHE), a hospital must call the CMS Medicare Administrative Contractor (MAC) enrollment hotline and attest the following:

  • It has made a “good faith” effort to exhaust all other options.
  • There are SNFs in the area that under normal circumstances would have accepted SNF transfers, but are currently not willing to accept or able to take patients because of the PHE.[1]
  • The hospital meets all aforementioned waiver eligibility requirements.
  • There is a plan to discharge patients as soon as practicable—when a SNF bed becomes available, or when the PHE ends, whichever is earlier.

One prediction of this waiver is that CMS may find it difficult to unwind a widespread hospital swing bed program once the PHE is over. Based on patient needs, outcome trends, and financial benefit, hospitals may see the advantage of patients remaining in place, and adjust the level of care provided, rather than transferring the patient to a new location with uncertain outcome variables.

If you would like assistance and guidance related to incorporating swing-bed services or the PACT policy, or for additional COVID-19 guidance, visit PYA’s COVID-19 hub, or contact one of our PYA executives below at (800) 270-9629.

[1] PYA is inferring CMS’ intention; the verbatim text from the summary document states: “There are no [emphasis added by PYA] SNFs in the area that under normal circumstances would have accepted SNF transfers but are currently not willing to accept or able to take patients because of the PHE.”

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