July Medicaid Rates and the Transition to PDPM-Based Case-Mix 

Many providers have noticed that the July Medicaid rates are the same as the April Medicaid rates. As North Carolina’s nursing facility Medicaid reimbursement transitions to a PDPM-based case-mix methodology, a frozen RUG case-mix index (CMI) was used to calculate both the April and July rates. The only exceptions were 13 facilities whose case-mix indexes were reduced as a result of prior MDS reviews. 

For providers who would like more detail on their facility’s Medicaid rates, NCHCFA has posted the latest Medicaid Rate Calculator. This resource provides a detailed breakdown of the various rate components used in the calculation. The July Medicaid Rate Calculator is available on the Association’s Reimbursement Resources webpage. Providers are encouraged to review their rate calculation details to ensure that the information used in the rate model matches their facility’s records (case-mix, patient days, Capital Data Survey submissions, etc.). 

The October Medicaid rates will be the first to incorporate the PDPM-based case-mix methodology. During this initial phase, the case-mix index will consist of one-sixth of the PDPM-based CMI (based on MDS assessments from the quarter ending June 30, 2026) and five-sixths of the frozen RUG CMI (based on the quarter ending September 30, 2025). Each subsequent quarter, the PDPM-based portion will increase by one-sixth while the frozen RUG portion will decrease by one-sixth until the transition to a fully PDPM-based case-mix methodology is complete. 

Providers should review their PDPM MDS coding practices carefully and ensure that all staff involved in the MDS assessment and coding process receive appropriate training, as the PDPM-based CMI will have an increasing impact on Medicaid reimbursement throughout the transition period.