Executive Compensation

The New York Court of Appeals has struck down portions of NYS DOH regulations limiting executive compensation and administrative expenses of healthcare providers participating in the Medicaid program. 

The Court struck down DOH’s “soft cap,” finding it exceeded DOH’s authority.  Therefore, the previous ceiling on executive compensation has now been removed, so long as the funds used for the compensation in excess of $199,000 derive from a source other than State funds.

However, the Court did uphold DOH’s two “hard caps,” one limiting administrative expenses to 15% of covered operating expenses paid with State funds, and one limiting the use of State funds for executive compensation to $199,000 (absent a waiver).  In other words, DOH can control how State funds are used but not restrict providers’ ability to use non-state funds for executive compensation purposes.

You should speak with your accountants and determine what portion of your executives’ compensation originates from sources other than State funding.

Note, covered executives include those for whom salary and benefits were administrative expenses, and excludes clinical and program personnel.

Please contact us with any questions.

New CMS SNF QRP Data

In other news, the Centers for Medicare & Medicaid Services (CMS) on Wednesday publicly released its Quality Reporting Program (QRP) data for skilled nursing facilities, on its Nursing Home Compare website.  The QRP data allows the public to review and compare quality of care at different facilities using 5 designated metrics.  The five new SNF QRP data measures are as follows:

Assessment-based measures:

1. Percent of Residents or Patients in a SNF that develop new or worsened pressure ulcers

2. Percentage of residents or patients whose activities of daily living and thinking skills were assessed and related goals were included in their treatment plan

3. Percentage of SNF patients who experience one or more falls with major injury during their SNF stay

Claims-based measures:

1. Medicare Spending Per Beneficiary (MSPB) for patients in SNFs

2. Rate of successful return to home or community from an SNF

CMS has decided not to publish a 6th quality measure, Potentially Preventable 30-Day Post-Discharge Readmissions, at this time. 

You can go to the Nursing Home Compare site to see the new data measures here: https://www.medicare.gov/nursinghomecompare/search.html?