1. AHCA/NCAL First Quarter Advocacy Blueprint 2014

2. Objectives To ensure that SNF providers do not receive an additional rate cut or reduction in the Market Basket increase. To advance a solutions driven agenda that is beneficial to our members and incorporates volume shifting policies to the SNF sector. To achieve an earlier implementation date of MMR reforms consistent with the Senate version released in December 2013. To ensure passage of Part B extenders in 2014.

3. SWOT Strengths  Strong relationships with growing reputation as a constructive advocacy group.  Commitment from House Leadership to avoid provider cuts.  Key staff support of volume shifting savings concepts.  Solutions fully developed that score savings.  Chairman and staff changes on Senate Finance Committee.  Unified sector with strong political presence.  Quality indicators are improving. Weaknesses  Not cut in last two SGR patches. (Making us a target)  Timing of SGR expiration is concurrent with other important deadlines.  Patch or permanent fix will require offsets.  Truncated congressional work calendar. (9 weeks)  Perception of high Medicare margins.

4. SWOT Opportunities  Advance alternative savings solutions that mitigate risks for cuts both legislatively and in the press.  Advocate for non-healthcare pay-for’s.  Advance legislation that resolves the observation stay problem.  Amplification of progress on quality Threats  Congressional propensity to make provider cuts in lieu of thoughtful reform.  Other provider groups advocating cuts to SNF’s.  MedPac recommendations being used as justification to cut rates.  Provider cuts outside of market basket resurfacing (Provider tax, bad debt)

5. Conclusions Nine month SGR fix most likely outcome at a cost of approximately $12B. Continuing to prepare for the possibility of a permanent SGR fix is prudent in light of low price tag. Environment remains extremely volatile with a multitude of possible scenarios.

6. Recommendations Continuing our messaging strategy focused on key members and leadership. Focus message on quality progress and low margins as reason for no additional cuts. Aggressively develop/finalize pay-for policies (bundling, re-hospitalization) to propose as an alternative to traditional cuts. Simultaneously advocate for alternative pay-for alternatives.(hips/knees) Continue to intensify political engagement and fundraising strategy in Q 1 of 2014 towards key members. (Front loading events in light of timeline) Explore collaborative opportunities with others in post acute space.