Skilled Nursing Facility Three-Day Waiver—Analysis of Use in ACOs 2014 to 2019

In traditional Medicare, beneficiaries must have a medically necessary inpatient hospital stay of at least three consecutive days for the program to pay for skilled nursing facility (SNF) services. The Centers for Medicare & Medicaid Services (CMS) waived these requirements for certain accountable care organizations (ACOs). The SNF three-day waiver allows health-care providers to admit a beneficiary to a SNF directly from the community or after only one to two days in a hospital. ACOs elect to use the waiver for qualifying beneficiaries to deliver care to the right patient at the right time in the right place. Eligible SNFs must have an overall rating of at least three stars under the CMS Five-Star Nursing Home Quality Rating System. This analysis examines how ACOs have used the SNF waiver over time. It helps assess whether health-care providers have used the waiver for beneficiaries who do not need to stay 3 or more days in an inpatient hospital.

For ACOs with the opportunity to use the SNF waiver, health-care providers appear, on average, to decide to use the SNF waiver for beneficiaries who do not require a preceding inpatient hospital stay of at least three days. Very few SNF stays were SNF waiver stays. Direct waiver admissions were most common, particularly for beneficiaries who need rehabilitation following an injury but not hospitalization. Beneficiaries under the waiver had shorter SNF length of stay and were more likely to be discharged home. Beneficiaries had lower or similar adverse outcome rates relative to beneficiaries not under the waiver.