Nursing Facility Bulletin 205: Updates to Instructions for Nursing Facility Fee-for-Service Payments: Minimum Data Set (MDS) 3.0 Assessments, Open PDF file, 391.01 KB

MassHealth Nursing Facility Bulletin 205, issued November 2026 and effective October 1, 2026, updates and supersedes Nursing Facility Bulletin 201 (July 2026). The bulletin governs fee-for-service payment rules for Massachusetts Medicaid nursing facility claims, tying payment rates to each member's Patient Driven Payment Model (PDPM) nursing case-mix category as determined by MDS 3.0 assessments submitted to CMS via IQIES. Facilities must submit assessments on admission, quarterly, annually, and upon significant change of status, in accordance with the CMS MDS 3.0 RAI Manual. MassHealth accepts assessments with an assessment reference date within 21 days of the 92-day CMS deadline for continued claims payment. The bulletin establishes three substantive policy changes effective October 1, 2026. First, MassHealth updates payment requirements for MDS items I6200 (active diagnosis of asthma, COPD, or other chronic lung disease) and J1100C (shortness of breath while lying flat), specifying the clinical documentation the medical record must contain to support coding of those items for payment purposes. For J1100C, documentation must come from a licensed nurse, physician, nurse practitioner, respiratory therapist, or physician assistant and must address onset, positions, medications, and care-planning interventions. Second, member eligibility for behavioral indicator add-on claims will be determined solely from Section E items E0200A, E0200B, E0200C, E0800, and E0900 of the original MDS assessment; a modified assessment that upgrades any of those items from 0 or 1 to 2 or 3 is disregarded for add-on payment eligibility purposes. Third, MassHealth removes the requirement that facilities submit a modified MDS assessment solely because of a MassHealth audit finding, including audits completed before October 1, 2026 for which a modified assessment has not yet been submitted. The bulletin describes an audit structure under 130 CMR 456.420(C) under which all facilities are audited twice per year on a random schedule. Audits cover up to 100% of admission, quarterly, and annual assessments, with particular focus on high-PDPM-score assessments, behavioral indicator add-on claims, all significant change assessments, and modified assessments with higher PDPM scores than the original for paid claims with service dates on or after October 1, 2023. If audit findings show the medical record does not support the MDS coding used to determine the PDPM Nursing HIPPS code, MassHealth will adjust the HIPPS code in MMIS for the affected payment quarter, with adjustment occurring no earlier than 31 calendar days after completion of the reconsideration process under 130 CMR 456.421. Non-compliance with the MDS RAI Manual may result in a Corrective Action Plan, referral to the Massachusetts Department of Public Health, overpayment recovery, sanction, or other EOHHS enforcement action. For retro-eligibility situations where an MDS assessment is required beyond CMS's two-year submission deadline, providers must submit specified documentation to MassHealth within 90 days of receiving the notice of MassHealth financial eligibility; requests submitted after 90 days will not be accepted and the MDS level of care will not be updated in the POSC.