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Nursing Facility Fee-for-Service Payment Policy

Nursing facility services are mandatory benefits that all state Medicaid programs must cover. Nursing facilities are institutions certified by a state to offer 24-hour medical and skilled nursing care, rehabilitation, or health-related services to individuals who do not require hospital care. In FY 2013, Medicaid fee-for-service spending for the 2 percent of beneficiaries who reside in nursing facilities accounted for approximately 20.4 percent of total Medicaid spending.

In 2016, there were about 15,600 nursing homes in the United States and about 95 percent of these were certified by state Medicaid programs. This brief summarizes trends in state policies and discusses recent policy developments.

MACPAC also has documented each state’s FFS nursing facility payment policies in States’ Medicaid Fee-for-Service Nursing Facility Payment Policies.