RCS-1 the RUG-IV Replacement

Summer 2017


RCS-1 the RUG-IV Replacement

CMS recently published a proposal to replace the current Skilled Nursing Facility Case-Mix-System (RUG-IV) with a new Resident Classification System, Version 1 (RCS-1).

CMS explained the reasons for the proposed change to the new system:

  1. “To address our concerns, along with those of OIG and MedPAC, about current incentives for SNFs to  deliver therapy to beneficiaries based on financial considerations, rather than the most effective course of treatment for beneficiaries: and “
  2. “To maintain simplicity by, to the extent possible, limiting the number and type of elements we use to determine case-mix, as well as limiting the number of assessments necessary under the payment system.”


A quick overview of the proposal reflects a change from the current three reimbursement rate components (Therapy, Nursing, and Non-Case Mix) to five (5) components (PT/OT, SLP, Nursing, NTA (non-therapy ancillary), and Non-Case-Mix).  The proposed number of reimbursement groups increases under this proposal.


# of Groups










It is important to note that the proposal states:  “Each of the case mix adjusted components will be determined based off specific resident clinical characteristics that will be determined by the coding of specific MDS items.   For the PT and OT and the SLP components, the number of therapy days and minutes will no longer be a deciding factor.” 

 “CMS is also proposing to significantly reduce the number of assessments needed under the new RCS-1 system.” To include a 5 Day Scheduled Assessment, that covers all days until Part A discharge; a significant Change in Status Assessment; and a PPS Discharge Assessment.  

For more detail information visit:  https://www.regulations.gov/document?D=CMS-2017-0061-0002