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Time and effort reporting is more than a routine administrative task—it’s a key control to ensure that payrolls charged to federally funded grants are allowable and properly supported. Because it is a high-risk area for grantees—and a frequent audit finding for HRSA grantees—strong documentation is critical to reducing compliance exposure and administrative burden. This article breaks down what time and effort reporting is, why the urgency has increased, and what health centers can do to strengthen practices and lower risks. 

In today’s increasingly digital environment, cybersecurity has become a critical concern for nonprofit (NFP) organizations. While many NFPs operate with smaller teams and tight budgets, they still handle sensitive information—donor records, payment data, client demographics, and sometimes even health‑related or financial assistance files. Unfortunately, cybercriminals recognize this and often view NFPs as soft targets with valuable data. Because community trust is so important, a cybersecurity incident can create financial and reputational hurdles for an organization. The good news, however, is that strong cybersecurity foundations do not always require major capital investments. With strategic planning and a focus on essential controls, even the most resource‑constrained organizations can significantly reduce cyber risk. 

A new federal executive order aimed at eliminating fraud, waste, and abuse signals a clear shift for healthcare and not-for-profit organizations that receive federal funds. While oversight of federal programs is nothing new, this order formalizes a cross-agency task force and raises expectations around documentation, internal controls, and accountability, particularly for organizations that participate in Medicaid, Medicare, and federal grant and assistance programs.

Beginning with calendar year 2026, public housing agencies (PHAs) will be required to submit an annual Federal Financial Report (SF-425) for each operating subsidy grant. Reporting will continue annually until all funds are fully expended or returned to HUD. These changes reflect HUD’s increased focus on transparency, grant life cycle oversight, and compliance monitoring.

To quote George R. R. Martin, “Different roads sometimes lead to the same castle.” The same can be said for Schedule A. When it comes to qualifying as a public charity, the IRS offers more than one path forward. In Part I of this series, we explored the Schedule A Part II public support test—a common route for donor‑supported organizations. In this second installment, we turn to the Schedule A Part III test, an alternative approach designed for organizations that operate under a fee‑for‑service or program‑revenue model. While the tests are different, both can ultimately lead to the same destination: public charity status. 

This is the first in a two-part series that provides a detailed examination of Form 990, Schedule A, offering practical guidance to the many organizations responsible for its complete and accurate preparation. This article focuses on organizations that qualify under Part I, Line 7 – 509(a)(1) – and the steps required to substantiate this classification through the Part II public support test. 

Charitable organizations play a vital role in addressing social issues, supporting communities, and promoting public welfare. As part of their mission, these organizations often make direct charitable expenditures to fund projects, provide services, and support individuals in need. However, with the privilege of tax-exempt status comes the responsibility to ensure that funds are used appropriately and in compliance with regulatory requirements. One crucial aspect of this compliance is expenditure responsibility, a concept that ensures charitable resources are used for their intended purposes. 

The Governmental Accounting Standards Board (GASB) issued Statement No. 105, Subsequent Events to enhance the transparency, consistency, and value of financial reporting related to events that occur after the financial statement date, but before the financial statements are issued. The statement realigns existing guidance by clearly describing the subsequent events' time frame, distinguishing between recognized and non-recognized subsequent events, and providing specific disclosure requirements. 

Rolling out new software isn’t just clicking “Install” and calling it a day. It’s more like planning a wedding. There’s the venue (servers), the guests (users), and yes, the unexpected costs that show up like distant relatives. In today’s digital-first world, implementing software is a strategic investment that can boost efficiency, strengthen compliance, and support long-term growth. However, the true cost goes beyond the sticker price on that shiny new platform. For nonprofits operating on limited budgets, careful planning is essential to avoiding hidden costs when making a technology upgrade. 

The affordable housing landscape in the United States is on the cusp of significant change with the introduction of the Renewing Opportunity in the American Dream (ROAD) to Housing Act of 2025. For nonprofit organizations operating in the affordable housing sector, this proposed legislation brings both new opportunities and important considerations. Here’s what you need to know. 

Liquidity is the lifeline of any nonprofit organization. Strong liquidity ensures uninterrupted programs, financial stability, and the flexibility to respond to unexpected challenges. This article shares practical steps to monitor and manage liquidity effectively, including setting clear policies, tracking cash flow, using key financial ratios, managing reserves, and leveraging technology. By following these best practices, organizations can maintain resilience, build trust with stakeholders, and stay focused on their mission—even during uncertain times.

Private foundations are vital players in the philanthropic landscape, channeling resources toward charitable, educational, and scientific causes. However, to maintain their tax-exempt status and avoid excise taxes, these organizations must comply with strict IRS rules—particularly those governing qualifying distributions. In the second installment of our trilogy, we will follow the McQueen Family Foundation to determine their qualifying distributions. As a non-operating foundation, this is a crucial step in their annual compliance requirements. 

The Minimum Investment Return (MIR) is a critical component for all private foundations. It is a standardized calculation based primarily on the value of the foundation’s investment (i.e., non-charitable use) assets to ensure that endowments are put to charitable use rather than accumulating excessive wealth with little to no public benefit. By adhering to IRS guidelines and maintaining diligent records, foundations not only avoid costly penalties but also contribute meaningfully to the communities and causes they support. 

A new Executive Order issued by President Donald Trump on August 7, 2025, brings major changes to how federal agencies handle discretionary grants. Titled "Improving Oversight of Federal Grantmaking," the changes in this Order introduce more political oversight, tighter controls on how funds are used, and new compliance rules that will directly affect organizations receiving federal funding. 

Capital campaigns can be game changers for nonprofits, enabling bold investments in infrastructure, programs, and long-term growth. Whether you're building a new facility, expanding services, or upgrading technology, a capital campaign aligns fundraising with your strategic vision. 

Signed into law by President Trump on July 4, 2025, the One Big Beautiful Bill Act (OBBBA) marks a significant step forward in addressing America’s growing need for affordable housing. With the demand for low-cost units far outpacing supply nationwide, the legislation offers targeted solutions aimed at making development more feasible and sustainable.

As artificial intelligence (AI) becomes increasingly woven into nonprofit operations, boards are stepping into a new and critical role. Traditionally focused on mission oversight and fiscal responsibility, today's boards must also shape how AI is introduced, governed, and aligned with the organization’s values. Below are the seven most important actions a board can take to ensure responsible and strategic AI implementation. 

Credit, purchase, and debit cards each offer convenience for small-dollar purchases, but carry varying levels of risk. Strong internal controls are essential to prevent fraud, misuse, and compliance violations.

Nonprofit leaders must assess the risks and strategically position their organizations to adapt to changing funding landscapes. This article outlines key steps to help your organization proactively evaluate funding vulnerabilities, mitigate risks, and plan for sustainable operations. 

With default federal student loan collections now resumed by the Department of Education, higher education institutions and other effected nonprofits need a strategy to ensure compliance. 

Most nonprofits rely on federal and state government funds to fulfill their missions. With a federal funding freeze in the headlines, many clients are asking us how they can best prepare for a freeze and protect their organizations if funding is cut. Here are three steps you can take today to stay ahead. 

As the new year begins, your organization may be starting to plan for your next fundraising event. In addition to raising money for the organization, fundraising events are a wonderful way to build relationships within the community, raise awareness for a cause, and provide a meaningful experience to donors. Beyond the excitement and benefits of these events, there are important Form 990 reporting and compliance requirements that you must consider. Below are the most frequently asked questions we receive from our clients. We hope this helps you avoid some common pitfalls around fundraising events.

Is your nonprofit using a break-even bottom line as your ultimate budget goal? If so, you may be missing out on opportunities to strategically further your mission. By looking at your budget using a statement of financial position perspective, rather than just a profit and loss perspective, you can gain a more complete financial picture of your organization.

As organizations navigate the complexities ahead in 2025, economic uncertainty presents both challenges and opportunities. Organizations must strategically address financial stability, donor engagement, federal compliance requirements, and workforce management to sustain their missions. This article dives into five critical finance trends and explores how nonprofits can effectively adapt.

The housing industry is subject to ongoing regulatory changes that are critical to their operations. Recently, we shared changes impacting compliance for multifamily housing, but that's just one example; all facets of the industry are subject to ongoing changes to compliance.

If it’s been a while since your nonprofit organization last conducted a review of its governing documents and policies, worry not, you’re not alone! This article will highlight a few of the most critical documents applicable to nonprofits to ensure you remain in compliance and good standing.

The United States Department of Housing and Urban Development (HUD) signed the Housing Opportunity through Modernization Act (HOTMA) into law on July 29, 2016. For multifamily housing owners, HOTMA went into effect on January 1, 2024, and owners are expected to be fully compliant by January 1, 2025.

Not-for-profit board members need to wear many hats for the organization they serve. Every board member begins their term with a different set of skills, often chosen specifically for those unique abilities. As board members, we often assist the organization in raising money and as such, it is important for all members of the board to be fluent in the language of fundraising. Here are some basic definitions you need to know, and the differences between them

Of all the changes that came with the sweeping Tax Cuts and Jobs Act (TCJA) in late 2017, none has prompted as big a response from our clients as the changes TCJA makes to the qualified parking deduction.

A capital campaign is a big undertaking. During the planning stage of a capital campaign you need to not only focus on your donor outreach strategy, but also on outreach materials. 

Good fundraising and good accounting do not always seamlessly align. While they all feed the same mission, fundraisers work to meet revenue goals while accountants focus on recording transactions in compliance with accounting standards. 

As 2018 is about to come to a close, organizations with fiscal year ends after December 15, 2018, are poised to start implementing the new not-for-profit reporting standard. Here are three areas to address before the close of the fiscal year to set your organization up for a smooth and successful transition, and keep in compliance:

With the wind down of the Federal Perkins Loan Program and announcement that the Federal Capital Contribution (FCC) (the federal funds contributed to the loan program over time) will begin to be repaid, higher education institutions must now decide how to handle these outstanding loans.

Last week, in addition to The Eagles Greatest Hits (1971-1975) album becoming the highest selling album of all time, overtaking Michael Jackson’s Thriller, the IRS issued Notice 2018-67—its first formal guidance on Internal Revenue Code Section 512(a)(6).

Over the course of its day-to-day operations, every organization acquires, stores, and transmits Protected Health Information (PHI), including names, email addresses, phone numbers, account numbers, and social security numbers.

Recently the Governmental Accounting Standards Board (GASB) finished its Governmental Accounting Research System (GARS), a full codification of governmental accounting standards.

As we begin the second year of Uniform Guidance, here’s what we’ve learned from year one, and some strategies you can use to approach various challenges, all told from a runner's point of view.

When it comes to offering non-qualified deferred compensation to executives of not-for-profit organizations, there aren’t many options.

With the implementation of GASB 72 now in full force, GASB organizations are hard at work drafting their new fair value disclosures. The addition of a fair value hierarchy table in the footnotes will add a bit more thickness to a likely already hefty financial package. 

Why it can happen to you and how to protect yourself. We’ve all seen the headlines. Stories about not-for-profit fraud have been popping up in the news, and the statistics confirm what you might have suspected: fraud in the not-for-profit sector is on the rise.

Who this article applies to: Compliance officers, revenue integrity directors, clinical documentation improvement specialists, clinical documentation and coding auditors, and healthcare providers at healthcare facilities or medical practices. 

It may feel at times like CPT® (Current Procedural Terminology) coding never changes—until it does. The American Medical Association (AMA) annually updates the CPT code set, with main revisions becoming effective January 1, 2027. These changes often require organizations to rethink documentation, coding, workflows, education, and auditing. CPT coding updates may be sporadic and unique, but early organizational preparation can minimize disruptions.

The impacts of CPT code changes may reverberate well beyond the coding department. Significant CPT revisions can affect the productivity, coding accuracy, denial rates, reimbursement patterns, compliance monitoring, Electronic Health Record (EHR) builds, payer contract assumptions, and audit findings of coding and revenue cycle teams. Even seemingly straightforward code changes can trigger extensive downstream impacts if documentation expectations, charge capture workflows, and system configurations are misaligned. Organizations should therefore approach major CPT updates as cross-functional operational changes, rather than as isolated coding updates, and prepare early. 

One CPT change, organization-wide impact 

The upcoming 2027 obstetric coding changes provide an excellent example of the broad impact code changes can have across an organization. Beginning January 1, 2027, maternity care reporting will undergo one of its most significant changes in decades, bringing an end to the long-used global obstetric package model. The resulting increase in Evaluation and Management (E/M) service reporting will require complete and accurate documentation to support code selection.

This shift to increased E/M coding for obstetric services reinforces an important lesson that is applicable to other service lines. Major CPT revisions, such as for obstetrics, rarely involve code changes alone. In the obstetrical example, use of increased E/M coding will require documentation improvements and EHR template revision, workflow redesign, provider education, and ongoing auditing to ensure compliance with the resulting changes.

Preparation will be especially important for these code sets because many patients receiving antepartum services in 2026 may continue their maternity care into 2027, when the new reporting structure takes effect. Organizations will need to consider how visits, documentation, charge capture, payer requirements, and patient encounters that cross the implementation date will be managed. Without proactive planning, organizations put themselves at increased risk for a cascade of events beginning with incomplete documentation and inconsistent coding, leading to potential delayed claims, payer denials, and confusion among providers and revenue cycle teams. Developing clear guidance before the updated code implementation will help ensure continuity of care, accurate reporting, and a smoother operational transition. 

Six steps to prepare for CPT changes

  1. Start planning early. Identify affected specialties, workflows, payer policies, and EHR implications to allow time for meaningful education and implementation of changes. 
  2. Engage multiple departments. Build a multidisciplinary workgroup that includes coding, compliance, revenue cycle, clinical leaders, operational leaders, and information technology representatives. 
  3. Focus on documentation, not just codes. New codes often introduce new documentation requirements that all clinical staff, coders, providers, and auditors should be aware of. Perform documentation gap assessments to identify where provider education may be needed before the effective date. 
  4. Evaluate technology. Validate EHR templates, charge capture tools, coding edits, payer rules, reporting systems, and analytics dashboards prior to January 1. 
  5. Monitor performance after implementation. Conduct focused post-implementation audits of documentation, coding accuracy, denial trends, and reimbursement patterns to identify improvement opportunities and provide feedback. Use findings to provide timely feedback and make necessary adjustments.  
  6. Communicate consistently. Provide staff and colleagues with regular updates and clear guidance throughout the transition period. Having a clear point of contact gives everyone a reliable resource for questions throughout the transition. 

Plan now for upcoming CPT code changes 

Major CPT revisions rarely involve coding changes alone; rather, they prompt cascading operational changes. Successful implementations occur when coding, documentation, compliance, clinical operations, IT, and revenue cycle teams begin planning well before the effective date. Organizations that start now will be best positioned to maintain compliance, support accurate reimbursement, and minimize operational disruption when the next major CPT update arrives. Now is the time to begin. 

BerryDunn can help  

Our healthcare compliance team can help. We incorporate deep, hands-on knowledge with industry best practices to help your organization manage compliance and revenue integrity risks. Learn more about our healthcare compliance consulting team and services.

Article
Beyond the code: Preparing for the next major CPT® update

Who this applies to: Read this if you are a business owner who accepts credit card payments.

As credit card processing costs continue to rise, many businesses are looking for ways to recover these expenses without significantly affecting profitability. Surcharging, which allows a business to add a fee when a customer pays by credit card, is one option. Dual pricing, which gives customers a choice between a lower cash price and a higher card price, is a second option. Business owners must weigh each option carefully to determine what will best suit their needs.

Surcharging: What you need to know

Most states allow businesses to add a surcharge for credit card payments, provided they comply with card network rules and applicable disclosure requirements. However, surcharging is prohibited or significantly restricted in certain jurisdictions, including Connecticut, Massachusetts, Puerto Rico, and potentially Maine. Several other states, including California, Colorado, New York, Minnesota, New Jersey, Nevada, and Texas, have additional requirements or restrictions that businesses should review before implementing a surcharge. Because surcharge laws continue to evolve through legislation, regulation, and court decisions, businesses should confirm current state requirements before moving forward.

Regardless of state, several card network rules apply. Debit card transactions can never be surcharged. Any surcharge must not exceed the merchant’s actual cost of processing the transaction and is generally capped by the card networks. Businesses must also clearly disclose the surcharge before payment is completed and confirm that their Point-of-Sale (POS) system can properly distinguish between credit and debit card transactions. If your business operates in a state where surcharging is prohibited or heavily regulated, a dual-pricing model may be a viable alternative.

What is dual pricing? 

Dual pricing presents customers with two prices upfront: a lower cash price and a higher card price that reflects the cost of card acceptance. Unlike surcharging, no additional fee is added at checkout. Instead, both prices are disclosed before the customer makes a purchasing decision, allowing the customer to choose their preferred payment method. 

Dual pricing is generally permitted throughout the United States when implemented as a properly disclosed cash-discount program. Businesses should work with their processor and legal counsel to ensure compliance with applicable laws, card-brand rules, and disclosure requirements.

Best practices for dual pricing compliance 

  • Establish the card price as the posted price and offer a clearly labeled cash discount. 
  • Display both prices prominently on shelves, menus, websites, and other customer-facing materials before checkout. 
  • Use consistent signage at entrances, checkout areas, and on receipts. 
  • Ensure receipts clearly show the transaction amount and any applicable cash discount. 
  • Utilize POS software designed to support compliant dual-pricing programs. 
  • Train employees to explain the pricing structure consistently and accurately. 

Customers should always be able to understand the price they are paying and how their choice of payment method affects the final transaction amount.

Addressing rising credit card processing costs 

As credit card processing costs continue to rise, many businesses are looking for ways to manage these expenses without significantly impacting profitability. Both surcharging and dual pricing can help offset processing costs, but each approach comes with specific legal and operational requirements. The key to a successful program is transparency: customers should clearly understand their options and pricing before making a purchase. By working closely with your payment processor, reviewing applicable state laws, and communicating openly with customers, businesses can implement a compliant solution that balances cost recovery with a positive customer experience.

State laws change frequently. Please consult the most current laws for up-to-date information. 

Key takeaways

  • Compare surcharging and dual pricing before choosing a way to recover credit card processing costs. 
  • Review state laws, card network rules, and disclosure requirements before adding a credit card surcharge. 
  • Confirm that your point-of-sale system can distinguish between credit and debit card transactions. 
  • Disclose cash and card prices clearly before checkout so customers understand payment-related costs. 
  • Train employees to explain the pricing structure consistently and accurately. 

About BerryDunn 

BerryDunn’s outsourced accounting services are tailored to the volume of work you have. Whether you need extra help in your office during peak times or interim leadership support during periods of transition, we can help you. We offer the expertise of a fully staffed accounting department for short-term assignments or long-term engagements―so you can focus on your business. Learn more about our team and services.

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Surcharging vs. dual pricing: Key insights for business owners

Compliance is more than a checklist: it is the foundation of organizational success. Across Medicaid agencies, health plans, healthcare providers, and community organizations, compliance creates the structure and consistency needed to fulfill the mission, protect those served, safeguard public resources, and earn stakeholder trust.

For Medicaid agencies in particular, the importance of compliance has never been greater. As states manage increasing program complexity, evolving federal requirements, heightened program integrity expectations, and growing scrutiny from oversight entities, compliance provides a critical framework for accountability, transparency, and responsible stewardship of taxpayer dollars.

Many organizations view compliance as a regulatory requirement or cost of doing business. In reality, it provides the framework needed to operate effectively, manage risk, and achieve sustainable success. For state Medicaid agencies, this framework is especially important as they operate under continual oversight from Centers for Medicare and Medicaid Services (CMS), the Office of Inspector General (OIG), state auditors, legislatures, and other stakeholders. A strong compliance program helps agencies proactively identify risks, strengthen controls, support program integrity, and demonstrate responsible stewardship of public funds.

A football game without rules, officials, coaches, or clear expectations would quickly become chaotic. Standards, oversight, and accountability do not hinder performance; they create the structure necessary for success. To achieve their objectives, organizations need clear expectations, defined processes, and effective governance. Compliance provides that foundation.

Without it, organizations face greater risk of errors, inefficiency, fraud, waste, abuse, regulatory violations, and reputational harm. Effective compliance supports sound decision-making, promotes consistency, and creates conditions for long-term success.

Putting compliance into practice

Strong compliance programs integrate governance, risk management, communication, training, monitoring, and continuous improvement into day-to-day operations.

At its best, the compliance function is a trusted advisor helping leaders identify risks, strengthen controls, improve performance, and make informed decisions.

Organizations with mature compliance programs are often better positioned to identify risks, adapt to changes, and maintain public trust. For Medicaid agencies, effective compliance programs can also support audit readiness, strengthen oversight of contractors and providers, improve program integrity efforts, and help identify and address issues before they become findings, corrective actions, or larger program risks.

Turning compliance into action

Organizations seeking to strengthen compliance do not need to address every challenge at once. Meaningful progress begins with a few foundational steps:

  • Establish accountability. Clearly define compliance responsibilities and ensure leaders and employees understand their role in managing risk and supporting organizational objectives.
  • Document expectations. Establish written policies and procedures that provide consistent guidance, support decision-making, and promote operational consistency.
  • Foster a culture of compliance. Encourage employees to ask questions, report concerns, and view compliance as a shared responsibility.
  • Evaluate and improve. Regularly assess risks, monitor performance, and use lessons learned to strengthen processes, controls, and outcomes.

Compliance is about trust

Compliance builds confidence that public funds are used appropriately, services are delivered responsibly, and decisions are made with integrity and transparency. For Medicaid agencies, that confidence extends to beneficiaries, providers, taxpayers, legislators, federal partners, and oversight entities that rely on the agency to be responsible stewards of public resources.

That trust depends on leadership commitment and ongoing investment in oversight, training, communication, monitoring, and continuous improvement. Compliance cannot reside within a single department. It must be embedded throughout an organization.

As organizations navigate increasingly complex regulatory, operational, and financial environments, leaders should periodically step back and ask:

  • Are our compliance activities aligned with our mission and strategic goals?
  • Do we have the people, resources, expertise, and infrastructure needed to manage risk effectively?
  • Are compliance considerations integrated into decision-making across the organization?
  • Does our culture promote accountability, transparency, and continuous improvement?

The answers may reveal vulnerabilities that threaten mission success, as well as opportunities to improve outcomes, strengthen resilience, and better position the organization for the future.

The question for leaders is not whether an organization is compliant today, but whether it has the governance, oversight, and the culture necessary to remain successful tomorrow. When embedded in strategy and operations, compliance becomes a driver of organizational excellence. It transforms mission into action, principles into practice, and strategy into measurable results. Beyond the checklist, compliance enables organizations to lead with integrity, manage uncertainty with confidence, and achieve sustainable success.

The questions posed in this article are intended to start a broader conversation about how compliance supports organizational performance. Future articles will explore practical strategies for strengthening governance, managing risk, developing effective written policies and procedures, and fostering a culture of integrity and accountability. Together, these elements can help organizations move beyond compliance as an obligation and leverage it as a strategic advantage.

Key takeaways

  • Recognize compliance as the foundation for organizational success, not just a regulatory requirement or cost of doing business.
  • Use compliance to create the structure, consistency, and accountability needed to fulfill the mission and safeguard public resources.
  • Integrate governance, risk management, communication, training, monitoring, and continuous improvement into day-to-day operations.
  • Strengthen controls, audit readiness, contractor and provider oversight, and program integrity efforts before issues become findings or corrective actions.
  • Evaluate whether compliance activities are aligned with mission, strategic goals, decision-making, and the culture needed for long-term success.

BerryDunn’s Medicaid Practice Group helps Medicaid agencies improve the health and lives of individuals by empowering, inspiring, and partnering with our clients—we innovate, share deep expertise, and provide an independent perspective to resolve challenges. We are the success partner for Medicaid agencies, building healthier communities and stronger futures. Learn more about our team and services.

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Why compliance drives success at Medicaid agencies: Beyond the checklist

A modest rate increase and CMS's inquiry into PDPM case-mix growth

The Centers for Medicare and Medicaid Services (CMS) issued the FFY 2027 Skilled Nursing Facility (SNF) Prospective Payment System (PPS) Final Rule, which was published in the Federal Register on July 31, 2026.  

The rule updates SNF PPS payment rates effective from October 1, 2026, to September 30, 2027, and includes changes to the SNF Quality Reporting Program (QRP), the SNF Value-Based Purchasing (VBP) Program, and several policy initiatives that may shape future reimbursement. 

While the payment update is relatively straightforward, CMS devoted considerable attention to reviewing trends under the Patient Driven Payment Model (PDPM), signaling continued focus on coding practices and potential future payment adjustments. Providers should pay close attention to this area as CMS evaluates comments received regarding case-mix growth and potential PDPM recalibrations. 

FFY 2027 PPS rate calculations 

CMS finalized a 2.4% payment update for FFY 2027, reflecting: 

  • A 3.3% SNF market basket increase 
  • Less a 0.9 percentage-point productivity adjustment 
  • No forecast error adjustment 

CMS estimates that the aggregate impact of the payment policies in this Final Rule will result in an increase of 2.4%, or approximately $882.7 million, in Medicare Part A payments to SNFs in FFY 2027. These estimates do not include the impact of SNF Value-Based Purchasing (VBP) adjustments, which CMS estimates will reduce payments by approximately $203.6 million. The impact of the update will vary by provider based on wage index changes, geographic location, resident case mix, and facility-specific VBP performance. 

CMS projects an average payment increase of 2.4% for urban SNFs and 2.7% for rural SNFs, with a low of 0.5% for rural Mountain providers and a high of 4.6% for rural New England providers. Actual provider-level impact will vary based on wage index changes and other facility-specific factors. 

The unadjusted federal rates for FFY 2027, prior to adjustment for case-mix, are as follows:  

FFY 2027 Unadjusted Federal Rate Per Diem – Urban 

Rate Component PT  OT  SLP  Nursing NTA Non-Case-Mix
Per Diem Amount $77.46   $72.10   $28.93   $132.02   $101.87  $120.91






FFY 2027 Unadjusted Federal Rate Per Diem – Rural 

Rate Component PT  OT  SLP  Nursing NTA Non-Case-Mix
Per Diem Amount $88.30  $81.10  $36.44  $129.00 $97.33 $123.15






These rates remain subject to PDPM case-mix adjustments and facility-specific wage index adjustments.

Updated PPS Rate Calculator available

As in prior years, BerryDunn has updated its interactive PPS Rate Calculator within the BerryDunn Senior Living Portal to incorporate the FFY 2027 payment rates and wage index information to assist you with the calculation of your facility-specific PPS rates.

Access the PPS Rate Calculator. 

Please note that calculated rates do not reflect facility-specific SNF VBP adjustments. BerryDunn will update the calculator as necessary once final incentive payment multipliers become available. Meanwhile, VBP information, including the incentive payment modifier for FFY27, has been made available to providers in iQIES. We recommend reviewing data carefully and promptly, as any requests for corrections are accepted by CMS through the end of August. 

CMS focuses on PDPM case-mix growth 

The most notable policy discussion in this year's Final Rule is CMS's continued evaluation of PDPM reimbursement trends. 

CMS previously solicited stakeholder feedback through a Request for Information (RFI) regarding observed increases in certain PDPM coding elements since implementation. Examples cited by CMS include substantial increases in reporting of diagnosis codes that increase PDPM reimbursement, such as malnutrition, swallowing disorders, and depression indicators. CMS noted that these trends have occurred while certain categories of resource utilization have declined.  

The agency presented potential methodologies for measuring what it refers to as "case-mix creep" and sought stakeholder feedback regarding possible future payment adjustments. While CMS did not finalize any PDPM payment reductions in this rule, the methodology discussed in the proposed rule produced a hypothetical system-wide case-mix creep adjustment factor of 0.957, which CMS estimated could equate to a 4.3% reduction in CMIs/base rates or a 3.6% reduction in total payments. Providers should view this discussion as a clear signal that CMS is actively evaluating whether future reimbursement modifications are warranted.  

CMS did not finalize any PDPM-related payment adjustments in FFY 2027. However, organizations should continue emphasizing accurate, well-supported clinical documentation and coding practices. 

SNF QRP update  

CMS finalized several changes to the SNF Quality Reporting Program. 

Removal of COVID-19 measures 

Beginning with FFY 2028 SNF QRP reporting, CMS is removing: 

  • COVID-19 Vaccination Coverage Among Healthcare Personnel 
  • COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date 
     

CMS noted that evolving vaccination guidance and the move toward individualized clinical decision-making have reduced the usefulness of these measures for quality reporting purposes.  

Shorter data submission deadlines 

CMS finalized changes that will significantly shorten quality reporting submission timelines.  

Beginning with FFY 2029 SNF QRP reporting, providers must submit data by the 15th day of the second month following the end of each calendar quarter, approximately 45 days after quarter-end, replacing the current four-and-a-half-month submission time frame. CMS stated the change is intended to improve the timeliness of publicly reported quality information.  

All-payer MDS reporting requirement 

CMS finalized a requirement that SNFs submit MDS data for all residents receiving covered skilled services, regardless of payer, beginning with the FFY 2031 SNF QRP. This change is intended to align SNF quality reporting with other post-acute care settings and provide a broader picture of SNF quality performance. 

SNF VBP program update  

CMS finalized performance standards for FFY 2029 and FFY 2030, revised the snapshot date for two MDS-based VBP measures to align with the revised QRP submission timeline, and made technical regulatory updates.   

CMS estimates that the SNF VBP Program will result in an approximately $203.6 million reduction in aggregate payments to SNFs nationwide during FFY 2027.

Bottom line for SNFs 

The FFY 2027 Final Rule delivers a modest 2.4% payment increase. 

CMS signaled continued interest in PDPM coding trends and potential future payment refinements. At the same time, providers should begin preparing for accelerated QRP reporting timelines and eventual all-payer MDS submission requirements. 

For most organizations, the immediate next step is understanding the impact of the FFY 2027 rates on facility-specific reimbursement. BerryDunn's updated PPS Rate Calculator can help quantify that impact and support budgeting efforts for the coming fiscal year. 

If you have any questions about the Final Rule or how it might affect your facility, please contact Ashley Tkowski or Melissa Baez.

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Federal Fiscal Year 2027 Skilled Nursing Facility Prospective Payment System Final Rule released

Every July, the National Recreation and Park Association (NRPA) celebrates Park and Recreation Month. This year's theme, "The Power Of," highlights the power of connection, play, community, nature, belonging, and well-being. But what does that actually look like?

When we posed that question to BerryDunn's Art Thatcher and Nikki Ginger, two longtime parks and recreation professionals who now advise agencies across the country, neither started by talking about facilities, amenities, or capital projects. They talked about people.

By the end of the conversation, a different question emerged: What if the real power of parks and recreation isn't in the places themselves, but in their ability to bring people together? 

The power of connection 

We live in a world designed to make interaction optional. We can stream entertainment without leaving the couch, order dinner without speaking to anyone, and maintain friendships through text chains and social media updates. Yet people continue to flock to parks, concerts, community events, trails, and recreation programs because technology may help us communicate, but it doesn't replace the human need to connect. 

Nikki was reminded of that recently when the Chicago Park District announced plans for moveable outdoor seating, something she first saw during a trip to Paris. This simple, though surprisingly rare, feature allows visitors to pull a chair into the shade, turn it toward a friend, or arrange them into small groups. It's a small design choice, but it reflects a much larger truth. People are looking for opportunities to gather, and parks create the conditions that make those connections possible.

Art sees those opportunities everywhere. He believes parks succeed because they provide something people are increasingly missing: common ground. Walk through a park alone and most people keep to themselves. Walk with a dog, a grandchild, a soccer ball, or even an artist's sketchbook, and the entire dynamic changes. Suddenly people are smiling, asking questions, and striking up conversations.

People look for common ground, and parks create thousands of those moments every day. A soccer game, a walking trail, a community event, or a neighborhood playground may be what brings people to a space, but the relationships that form there are what give it meaning.

Throughout his career, Art has seen parks and recreation bridge generations, cultures, and neighborhoods in ways few other institutions can. As he put it, "A pool table is still a pool table whether you're 12 or 82." The activity may look simple, but it creates a rare opportunity for people of different ages and backgrounds to share an experience. The activity may be different, but the outcome is often the same: people finding a reason to connect. 

The power of play 

Play tends to get dismissed as something that belongs to children, but Art and Nikki would strongly disagree. 

In fact, many of life's most important lessons are learned through recreation. Board games teach strategy and problem solving. Team sports teach collaboration and resilience. Friendly competition teaches us how to win graciously and lose gracefully. 

Art laughed as he described a household rule while raising his children in a highly competitive family: "The first one to cry goes to bed." Behind the humor, though, was a serious point. Play gives people a safe environment to experiment, learn, fail, adapt, and grow. The lessons may begin on a playing field or around a game board, but they often carry into school, work, relationships, and everyday life. 

Play also has a unique ability to bridge divides. Art pointed to the World Cup as a perfect example. Fans from around the globe gather around a shared love of the game, setting aside cultural differences and preconceived notions. Visitors discover that communities are often more welcoming than expected. Residents discover they have more in common with people from different backgrounds than they realized. For a few hours, politics, geography, and stereotypes take a back seat to a shared experience. 

For Nikki, play is also closely tied to wellness and longevity. She pointed to research on Blue Zone communities, where people regularly live longer, healthier lives than average. One of the common threads is meaningful engagement with family, friends, and community. Recreation often provides the vehicle for those interactions, creating opportunities for people to stay active, involved, and connected across generations. 

She's seen that firsthand in her own family. When conversations begin heading into uncomfortable territory, Nikki has a simple solution: bring out a game. Almost immediately, the conversation changes. People stop focusing on their differences and start focusing on a shared experience. The atmosphere lightens. Everyone reconnects. It goes beyond being a distraction from real life. It can actually be the catalyst for helping us navigate real life. 

The power of community 

One theme surfaced repeatedly throughout our conversation: people want to be together. 

The growing popularity of community events proves it. Movie nights in the park, outdoor concerts, food truck festivals, and community celebrations continue to draw strong participation, even though people could enjoy the same entertainment from the comfort of home. That's because the attraction isn't really the movie, the concert, or even the food; it's the shared experience. 

As Nikki put it, people want to gather. Sometimes they just need an excuse.  

Art shared a similar story. When a friend's son was in town playing baseball, a simple invitation went out to a small group of friends. By game time, nearly twenty people had shown up. The baseball game gave them a reason to gather, but seeing one another was what made the evening memorable.

That ability to create community is why Art still remembers something a city manager told him decades ago: 

"You are my feel-good department." While police departments respond to emergencies and public works departments maintain infrastructure, parks and recreation creates experiences people look forward to. It creates moments of joy, celebration, connection, and belonging that shape how people experience their community. 

In a world where so many conversations focus on what's broken, parks and recreation offers something different: opportunities to build relationships, create memories, and strengthen the ties that make communities feel like home. 

The power of nature and belonging 

If the pandemic taught communities anything, it was that access to nature isn't a luxury. It's essential. 

Both Art and Nikki have watched communities rediscover the value of trails, open spaces, neighborhood parks, and outdoor recreation over the past several years. During COVID, people sought refuge outdoors. What many discovered was that these spaces offered far more than recreation. They offered relief, connection, perspective, and resilience. 

The renewed appreciation for outdoor spaces has led to another shift that Art sees in communities across the country. For years, many communities poured resources into destination facilities and large sports complexes. Today, residents increasingly ask for something much simpler: a quality park close to home. 

They want a place to walk with their families, sit under a tree, read a book, or simply spend time outside. They want a place where neighbors recognize one another and where the community feels accessible, familiar, and welcoming. 

In short, they want a place that feels like theirs. As Art noted, if you want to see how much people value a park, tell them it's going away. 

Residents who haven't visited in months will show up at meetings to defend it. Not because they're thinking about a playground or a walking path, but because they're thinking about what that place represents. It's part of their identity, their neighborhood, and their community. 

Common ground 

Throughout our conversation, Art and Nikki kept returning to the same idea, even when they were answering completely different questions. Whether they were talking about play, nature, community events, or neighborhood parks, the underlying value was remarkably similar: Parks and recreation creates common ground. 

A soccer game is a universal language that requires no translation, no matter where in the world you are. A community concert gives friends a reason to gather. A walking trail creates chance encounters. A neighborhood park becomes part of a community's shared identity. 

In a time when people often feel isolated, stressed, or divided, parks and recreation provides something increasingly valuable: opportunities to show up, share an experience, and connect with one another. That's what Nikki sees in crowded movie nights, multigenerational programs, and communities rallying around the spaces they love. It's what Art has seen throughout a career spent helping communities build places where relationships can grow. 

The parks may bring people in. The programs may get them involved. But the real power of parks and recreation lies in what happens next: the conversation that starts on a walking trail, the friendship that forms at a community event, the neighbors who become connected through a shared place. 

Sometimes all it takes is a little common ground to turn a space into a community. 

Innovative strategies for parks, recreation, and libraries 

BerryDunn's consultants work with you to improve operations, drive innovation, identify improvements to services based on community need, and elevate your brand and image―all from the perspective of our team’s combined 100 years of hands-on experience. We provide practical park solutions, recreation expertise, and library consulting. Learn more about our services and team.  


 

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What Is the Real Power of Parks and Recreation?