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Date ArticleType
3/5/2018 Payment/Reimbursement
A Two-Minute Primer on CMS’ New Payment System Proposal: The Resident Classification System (RCS-1)

CMS has a plan in the works to replace the Prospective Payment System (PPS), which is the current Medicare payment system. CMS is proposing RCS-1, which would represent a significant shift away from therapy as the primary payment driver. Under RCS-1, payment would instead be driven by clinical patent characteristics.    

RCS-1 would be based on the four patient characteristic components below. Within each component, more specifics details about the patient’s condition are considered, and points are assigned accordingly to calculate the reimbursement rate.

PT/OT; 30 case mix groups

Speech Language Pathology; 18 case mix groups

Nursing; 43 case mix groups

Non-Therapy Ancillary Services (NTAs); 6 case mix groups

A free AHCA webinar detailing an overview of the RCS-1 system will be available on Thursday, March 29, 3- 4:30 p.m. ET. Register here

Please note that a formal rule proposal has not yet been released, and so providers are encouraged to use caution when exploring the possible impacts of RCS. CMS has created the Building by Building Simulated Payment Tool for providers to be able to compare payment under an RCS system to payment under the current PPS system. You can find the tool here: