AMED - Credit Suisse analyses the impact of CMS payment updates for FY21

Yesterday, the Centers for Medicare & Medicaid Services (“CMS”) issued proposed rules that would update terms and policies for the Skilled Nursing Facility prospective payment system and Hospice base payments for fiscal 2021.Proposals include an increase of 2.3% of payments for hospices compared to the proposed ~2.6% and the final 2.4% increase in FY21.SNFs are set to witness a 1.3% increase in payments compared to the proposed 2.3% and final 2.2% in FY21.Noting that the Hospice rate update was ‘in-line’ with its expectations and ‘constructive’ for the industry, the analysts at Credit Suisse call that the amendment to SNF rate came below expectations.With CMS targeting a potential negative rate adjustment in the future years to ensure PDPM (Patient-Driven Payment Model) stays budget neutral, the firm expects a negative impact on the industry as a result.The analysts led by A.J. Rice point out Amedisys ([[AMED]] +3.3%), LHC Group ([[LHC]] -0.4%) and Encompass Health ([[EHC]] -0.1%)

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Credit Suisse analyses the impact of CMS payment updates for FY21