Change is the only constant in any industry. In long-term post-acute care (LTPAC), you brace yourself for new regulations from the Centers for Medicare and Medicaid Services (CMS) every year, and 2025 is no exception. Prepare yourself for these changes to payment adjustments, quality reporting requirements, and compliance mandates. Adapting to these shifts will help you stay compliant throughout fiscal year 2025 while optimizing your payments.
1. CMS Payment Rate Adjustments
The final rule update to the CMS rule regarding the long-term care hospital (LTCH) prospective payment system (PPS) went into effect on October 1, 2024. It increases LTCH payments by 2%, which could potentially boost your revenue over the next fiscal year.
Overall, the rule raises the standard payment rate by 3% through a slight decrease in high-cost outlier payments. Understanding that the costs of providing healthcare are rising, CMS based its market basket on 2022 cost reports instead of outdated information from 2017.
CMS increased its threshold for the fixed-loss amount that qualifies your agency for a high-cost outliner reimbursement to $90,921. Although CMS expects the increase in standard payments to balance out its changes to high-cost outlier thresholds, you can prepare by planning to absorb some financial losses for high-cost outliers in your facility.
2. Merit-based Incentive Payment System (MIPS) Updated
CMS is still dedicated to improving quality patient care in the United States through merit-based incentive payments. Your agency still needs to maintain a performance threshold of 75 points or face financial penalties. However, the way you earn these points has changed.
In 2025, CMS removed 10 existing quality measures, added 7, and made substantial changes to 66. New quality measures include biomarker expression tests, germline testing in ovarian cancer patients, COVID-19 vaccination status, tracking and evaluating recurring melanoma, first-year standardized waitlist ratio, and the percentage of prevalent patients waitlisted.
As an LTCH, you are likely focused on improving patient conditions as part of your efforts to improve quality care. CMS has added two new activities in this category, has modified one, and has removed four.
Stay in compliance and maximize your quality score by familiarizing yourself with the updated quality patient care measures and thoroughly documenting your treatments.
3. Updated Surveyors Guidance for Long-Term Care Facilities
You know you’re dedicated to providing high-quality care for your patients, and Medicare wants to verify your commitment. In an effort to gather accurate date, CMS has revised its long-term care surveyor guidance for better oversight and quality control.
The new guidelines cover admissions, transfers and discharge, chemical restraints, unnecessary medications, resident assessments, and more. These guidelines make it easier for surveyors to assess a facility for compliance. It makes the survey process more consistent across facilities and helps surveyors analyze a facility’s feedback. Many of the new guidelines create strict standards for medication management, admission and discharge practices, and infection control. They also help surveyors make sure facilities are providing treatment equitably.
New surveying guidance went into effect on February 24, 2025.
4. Infection Prevention and Control Enhancements
As a long-term care provider, your patients often come to you with weakened immune systems. Infection prevention and control is a vital part of your services, because your patients are more susceptible.
Part of the new Surveyors Guidance for Long-Term Care facilities involves measuring how your agency prevents and controls infections. Surveyors will inspect every part of your facility and your procedures that could cause infections to spread including food service, staff wardrobes and accessories, ice and water handling, and more. They will also evaluate your response procedures to make sure you’re actively preventing infections from spreading.
Not following strict infection prevention and control procedures puts you at risk for fines. Make sure you stay in compliance by documenting your procedures and maintaining detailed reports and logs.
5. New Technology Add-On Payments
New technology improves your patient care. Using interoperable electronic health records (EHR) software lets you efficiently share and store data for reporting, patient transfers, and more. Wearable tech improves your ability to monitor patients at all times without dispatching nurses to their rooms 24/7.
CMS understands how tech contributes to patient care and has approved 15 new technology add-on payments to encourage facilities like yours to adopt and upgrade technology. This criteria requires new technology to substantially improve patient diagnosis, care, and clinical outcomes.
6. GUIDE Program
One substantial change to CMS in FY 2025 is the GUIDE model for dementia care. This program is in its testing stage at multiple long-term care facilities throughout the country. It establishes a comprehensive model of caring for dementia patients.
This model aims to improve how dementia care is coordinated among multiple caregivers. It also includes resources to support unpaid caregivers offering crucial care to their loved ones with dementia.
