Medicaid Nursing Home Rates by State

← All states

Tennessee

Medicaid nursing facility payment · Hybrid · researched October 2026

Tennessee’s Medicaid agency and its state plan are the official source for these rules. This page summarizes them as researched in October 2026; check the state’s own documents, listed under Sources, before relying on them.

At a glance

Rate method

Hybrid

Case-mix level

Facility average

Classification

PDPM

Rate updates

Twice a year

Managed care (LTC)

Yes

Quality program

QuILTSS

Paid outside the rate

Small

Bed hold

Not paid

Published rates

Not published

Assisted living

Covered

Personal needs allowance

$70 / month

Overview

• Each nursing facility gets its own daily rate, rebuilt every January 1 and July 1.
• It adds up five parts.
• (1) Direct care: one statewide price set at 106% of the median, multiplied by the facility's Medicaid case-mix score (a measure of how sick its residents are), plus a second statewide price for food and other non-nursing direct care, then a cut if the facility spent too little on direct care in the past.
• (2) Administration: one flat statewide amount for everyone, set at 101% of the median.
• (3) Capital, paid as 'fair rental value' (FRV): a set return on the appraised building value, not the facility's actual rent or interest.
• (4) A pass-through for real estate tax and the Medicaid share of the provider assessment.
• A budget factor then scales the total, and a separate quality payment from the QuILTSS pool is added on top.
• Quality tier also changes three of these parts: the food/non-nursing multiplier, the FRV rental rate, and the spending-floor percentage.

What matters in Tennessee

• All residents are in managed care, and plans must pay exactly the TennCare-set per diem, net of patient liability.
• Quality tier (QuILTSS score) changes three base-rate parts plus a separate payment; the pool grows toward 10% of spending.
• Bed holds are not paid at all, for hospital or therapeutic leave, since July 1, 2018.
• A direct care spending floor of 90-94% of the direct care rate, set by quality tier, cuts rates for underspenders.
• Case mix is one PDPM nursing (federal acuity measure) average per home, updated each January and July.
• Only about 3% of pay is outside the rate: a 3.03% directed payment, below the federal cap, so not expected to phase down.

Frequently asked

Does Tennessee allow managed care plans to negotiate nursing home rates?

No. Plans must pay exactly the TennCare-set per diem, net of patient liability.

What happens to a Tennessee home's rate when its direct care spending falls short?

Homes must spend 90%, 92% or 94% of their direct care rate, set by quality tier. Any shortfall is deducted from the rate.

Does Tennessee Medicaid pay to hold a bed during a hospital stay?

No. Bed holds have not been paid for hospital or therapeutic leave since July 1, 2018.

How much is paid outside the posted rate in Tennessee?

Small, about 3% of base, from a uniform 3.03% directed payment of up to $39.06M in CY2026.

What does Tennessee Medicaid pay on Medicare coinsurance days?

Lesser-of: the home usually receives $0 of the coinsurance because Medicare's rate exceeds the TennCare rate.

How is the Tennessee nursing home provider tax charged?

6% of net patient revenue in total, with 2.75% for small, CCRC, Medicare-only and high-Medicaid homes.

How the rate is set

How the method got here

Verified October 11, 2026

Cost basis

Uses cost reports

Yes

Cost report

Medicare cost report (CMS-2540-10, or CMS-2552-10 for hospital-based units) plus the TennCare Medicaid Supplemental Cost Report (an Excel template from Myers and Stauffer). Both are filed with the Comptroller and due on the last day of the 5th month after fiscal year-end (Rule 1200-13-02-.05).

Base year and rebasing

The rule requires rebasing at least every 3 years. A rebase uses the latest audited or desk-reviewed cost reports that end 18 or more months before the rebase date (Rule .06(2)). The first base year (July 2018) used cost reports ending on or before 12/31/2015. The July 1, 2024 rebase used calendar-2022 cost reports, according to the Myers and Stauffer PDPM FAQ (Sept 2023, Q8). Under the 3-year rule, the next rebase is due by July 1, 2027. Between rebases, the medians and the tax pass-through are inflated with the index factor.

Components

Component	Method	Notes
Direct care, case-mix adjusted (RN, LPN, CNA wages and benefits)	Price. Each facility's cost per day is inflated, divided by its cost-report-period CMI to remove acuity, and ranked. The statewide price is 106% of the median, weighted by Medicaid days. Each facility gets that price times its own Medicaid-only semi-annual CMI.	Rule 1200-13-02-.06(5)(a)1. DON/ADON, MDS coordinator and other admin nursing are excluded here.
Direct care, not case-mix adjusted (DON/ADON, raw food, dietary supplements, social services, activities)	Price. The statewide price is 106% of the Medicaid-day-weighted median, multiplied by a quality-tier multiplier: Tier 1 = 105%, Tier 2 = 102.5%, Tier 3 = 100%.	Rule .06(5)(a)2.
Direct care spending floor adjustment	Downward-only adjustment. TennCare multiplies the facility's two direct-care parts by a floor percentage that depends on quality tier: Tier 1 = 90%, Tier 2 = 92%, Tier 3 = 94% (in effect since July 1, 2021). If the facility's actual Medicaid direct-care cost per day, taken from a cost report 18 or more months old, inflated and CMI-adjusted, falls below that threshold, the shortfall is subtracted from its rate. Otherwise the adjustment is zero.	Rule .06(5)(a)3. Better quality tiers get a lower floor. New providers are exempt until their first reviewed cost report. Buyers in a qualifying change of ownership can ask for a provisional waiver.
Administrative and operating	One flat statewide price, the same for every facility: 101% of the Medicaid-day-weighted median.	Rule .06(5)(b). Starting with MDS case-mix reviews that begin on or after July 1, 2026, this part is cut 0.5% to 8.5% if more than 20% of a facility's sampled MDS assessments are unsupported.
Capital (fair rental value)	Appraisal-based FRV. See the capital field.	Rule .06(5)(c).
Cost-based pass-through	(a) Real estate tax: the facility's actual tax, divided by the greater of actual days or 85% of licensed-bed days, then inflated. (b) Provider assessment: TennCare sets a per-day amount for the Medicaid share of the assessment, by provider class under T.C.A. 71-5-1003.	Rule .06(5)(d).
Excluded costs	Not paid. This covers nursing/allied health education, interns and residents, paramedic programs, ancillary cost centers, and overhead allocated to non-SNF/NF areas.	Rule .01(14).

Inflation

The 'index factor' is the most recent IHS Global Insight (S&P Global) Skilled Nursing Facility market basket without capital. It is applied from the midpoint of each facility's cost report year to the midpoint of the rate year. It inflates the direct-care and administrative medians and the real estate tax part. It does not inflate FRV appraisal values between appraisals (Rule .01(18), .06(3), .06(5)(c)8(xii)).

Verified October 11, 2026

Case mix

System

PDPM

Applied at

Facility average

How it works

One rate per home: the direct care price x the home's semi-annual time-weighted Medicaid average case-mix index. Every Medicaid resident is paid the same rate.

Classification

PDPM nursing-component CMIs, using the CMS FY2024 table effective 10/1/2023 (25 nursing groups). Through June 30, 2024 the state used RUG-IV 48-group nursing-only weights (v1.03, index maximizer).

Applies to

Only the case-mix-adjusted direct care part. The facility-wide CMI for the cost report period is used to remove acuity from costs before setting the median. The Medicaid-only CMI for the rate period sets the facility's rate.

Acuity measured from

Medicaid residents only for the rate: the Medicaid Nursing Facility-Wide Semi-Annual Average CMI, counting assessments where Medicaid is the primary payer. CMI is time-weighted: each MDS assessment counts for the calendar days it was active, not a single snapshot. Each rate period uses assessments active from 10 months to 4 months before its start. For example, the July 1 rate uses Sept 1 through Feb 28/29, and the January 1 rate uses March 1 through Aug 31. Assessments more than 113 days old count as delinquent (BC1). Facilities first get a preliminary CMI report (PCIR), then a final one (FCIR).

Updated

Twice a year: January 1 and July 1.

Move to PDPM

Rates effective July 1, 2024 were the first set on PDPM nursing CMIs, using PDPM data from 9/1/2023 to 2/29/2024. Shadow PDPM rosters went out starting with July 2023. RUG-IV was used through rates ending June 30, 2024. The June 29, 2026 rule amendments wrote PDPM into the rule and changed the cost-report-period CMI to use quarterly instead of semi-annual CMI periods. No hold-harmless or phase-in for the PDPM switch appears in the rule (see open_questions).

Verified October 11, 2026

Low-acuity residents

None found. There is no reduced or flat rate for low-acuity residents. Since July 1, 2018 every Medicaid resident in a home is paid the same facility rate, and acuity enters only through the home's average Medicaid case-mix index (Rule 1200-13-02-.06(5)(a); MCO contract A.2.13.3.1: pay 'the per diem rate specified by TENNCARE'). The old Level 1 vs Level 2 nursing facility rates (Level 2 = skilled/rehab residents, paid more) were ended on July 1, 2018. They were folded into one blended rate, phased in through June 2020 using each home's July 2017 Level 1/Level 2 mix (Rule 1200-13-02-.06(5)(e)3). Rule 1200-13-01-.03, which used to hold the Level 1 and Level 2 methods, now just says 'See Chapter 1200-13-02.' The Level 1/Level 2 labels survive only in admission evaluations (PAEs) and CHOICES home-care cost caps (Rule 1200-13-01-.05, .10), not in what the home is paid. Residents scoring under 9 points on the TennCare level-of-care acuity scale do not qualify for Medicaid nursing facility payment at all (Rule 1200-13-01-.10). That is an eligibility gate, not a reduced rate. Checked: Rule 1200-13-02 (rev. June 2026), Rule 1200-13-01 (rev. Oct 2025) sections .03/.05/.10, the MCO contract, the Wellpoint CHOICES manual, and the Dec 2025 cost-neutrality memo (one blended average, $294.87/day).

Verified October 11, 2026

Capital

Fair rental value (FRV) based on an appraisal by a single statewide appraiser TennCare hires, using Marshall & Swift/Boeckh replacement cost. Building depreciation uses grouped age bands, with at least 10 years of remaining life always assumed. Only 50% of appraised depreciation counts if the building's weighted age is under 30 years, and 70% if 30 or older. Land is capped at $7,500 per licensed bed. Total base value is capped at $75,000 per licensed bed, plus $1,500 or $3,000 per bed if Medicaid private-room days are at least 5% or 10%. Moveable equipment adds a flat $7,500 per bed. The total is multiplied by a quality-tier rental factor (Tier 1 = 8.70%, Tier 2 = 8.35%, Tier 3 = 8.00%), then divided by the greater of actual days or 85% occupancy of licensed beds. Licensed beds are counted as of April 1 each year. A statewide reappraisal is required with the next rebase if 6 or more years have passed since the last one. Voluntary reappraisals are allowed for relocations, bed moves over 10%, or renovations of at least 15% of value. Twice a year, facilities can add fixed-asset spending over $1,000 per bed (placed in service within 24 months) through a Capital Improvement Update Request; these additions are not inflated or depreciated. Rule 1200-13-02-.06(5)(c).

Verified October 11, 2026

Budget adjustment factor

Yes. Under Rule .06(5)(e)2, TennCare sets a budget adjustment factor (BAF) every July 1 and recalculates it every January 1. The BAF is the nursing facility budget target divided by the expected cost of the rate system. It applies as one across-the-board percentage to all rate components and can raise or lower rates. The BAF has been in the rule since the July 2018 case-mix system. The actual BAF percentage for any year was not found in public sources; it appears only on facility rate sheets. In 2026, House Bill 1864 as filed would have put the BAF into law, banned it in rebase years, and required notice to the legislature before cuts. That language was removed by House amendment HA0697, and the enacted law (Public Chapter 990) only extends the assessment.

Verified October 11, 2026

Add-ons and money outside the rate

Paid outside the posted rate

Level

small

Estimate

About 3% of base. The only money outside the per diem is the CHOICES state directed payment, a uniform 3.03% increase on base reimbursement paid as MCO lump sums (up to $39.06M for CY2026). QuILTSS is paid inside the per diem, and ERC respiratory add-ons are per-day claim amounts, so neither counts here.

Components

CHOICES nursing facility state directed payment: up to $39,062,500 CY2026 (was $89,005,752 CY2024); uniform 3.03% of base; likely grandfathered under P.L. 119-21 s.71116 (total cannot rise); below the 110%-of-Medicare cap, so no phase-down expected under CMS-2449-P (proposed); renewed annually. No UPL or IGT program found.

Source

https://www.medicaid.gov/medicaid/managed-care/downloads/TN_F…

Verified October 14, 2026

Payments by owner type

Applies

no

Detail

No owner-based payments found. There is no regular UPL or IGT program for nursing facilities, and the directed payment is a uniform 3.03% increase for all CHOICES nursing facilities.

Funding

Not applicable (the directed payment's non-federal share is state funds: $14.0M of $39.06M CY2026).

Source

https://www.medicaid.gov/medicaid/managed-care/downloads/TN_F…

Verified October 11, 2026

Quality program

Program

QuILTSS (Quality Improvement in Long-Term Services and Supports) nursing facility value-based purchasing

Funding

Comes out of the nursing facility budget, which is funded by the provider assessment plus state general funds and the federal match. It is a set-aside within the rate system, not new money on top. The pool minimums in the rule are applied before the budget adjustment factor (BAF), so the BAF can scale the final dollars. Source: Rule 1200-13-02-.11(1).

Size

By rule, at launch (July 2018) it was the greater of $40M or 4% of projected nursing facility spending. It grows each year at 2x index-factor inflation until it reaches 10% of projected spending, then is held at 10%. The current dollar amount and share for SFY2027 were not found in public sources.

Paid as

Two channels. (1) A stand-alone quality component added to the facility's per diem and paid through MCO claims. (2) Quality-informed rate parts set by tier: the non-case-mix direct care multiplier (Tier 1 = 105%, Tier 2 = 102.5%, Tier 3 = 100%), the FRV rental factor (8.70% / 8.35% / 8.00%), and the direct-care spending-floor percentage (90% / 92% / 94%). A lower floor means a smaller clawback for facilities that under-spend on direct care.

Measures

Measure	Source	Weight	How points are earned
Resident satisfaction (CoreQ 'recommend this facility')	survey (CoreQ, run by vendor QBlue Surveys)	15 pts	QuILTSS #18: 15 if the facility's satisfaction rate average (mean of top-1, top-2 and top-3 box) is at or above the national average; 10 if at least 85% of it; 7.5 if at least 75%; 5 if the top-box score improved 5 or more points year over year
Family satisfaction (CoreQ)	survey (CoreQ)	10 pts	10 if at or above the national average; 7.5 if at least 85%; 5 if at least 75%; 3 for 5-point improvement
Employee satisfaction ('recommend as a place to work')	survey	10 pts	10 if top-box at or above the TN state average; 5 if top-2 box at or above the state average; 3 for 5-point top-box improvement
Respectful treatment	resident survey	10 pts	10 if top-box at or above the TN average; 5 if top-2 box at or above it; 3 for 5-point improvement
Resident choice	resident survey	10 pts	10 / 5 / 3, same structure
Resident and family input	resident survey	5 pts	5 / 2.5 / 2, same structure
Meaningful activities	resident survey	5 pts	5 / 2.5 / 2, same structure
CNA case-mix-adjusted hours per resident day	PBJ (CMS Provider Information file, January release = prior-year Q3 data)	5 pts	5 if above the national average; 3 if above 90% up to 100% of it; 1 if above 80% up to 90%; 0 if 80% or below
RN case-mix-adjusted hours per resident day (QuILTSS #18). From #19 (July 2027 rates) this becomes RN+LPN combined	PBJ (CMS Provider Information file)	5 pts	Same 5/3/1/0 bands against the national average
Consistent staff assignment (% of long-stay residents with 12 or fewer caregivers a month)	state (TennCare tracking tool v1.8, facility-reported, at least 3 months including one in Q4)	5 pts	5 if 90% or more; 4 if 80-89%; 3 if 70-79%; 2 if 60-69%; 1 if under 60% (participation credit)
Nursing staff retention (RN, LPN, CNA employed or contracted 12 months or more)	state (facility-reported retention report)	5 pts	5 if 75% or more; 3 if 70-74.9%; 1 if 60-69.9%
Staff training (QuILTSS #18 only; removed from #19)	state	5 pts	Full 5 points to all participating facilities
Long-stay antipsychotic use (QuILTSS #18; replaced in #19)	MDS QM (CMS, Q4 prior year to Q3)	5 pts	Scored by quarter: 5 if below the national average; 3 if not below it but improving faster than the national trend; quarters weighted 50/25/15/10 (most recent highest) or equal, whichever scores higher
Long-stay urinary tract infections (QuILTSS #18; replaced in #19)	MDS QM	5 pts	Same quarterly 5/3/0 method
From QuILTSS #19 (July 2027 rates): long-stay catheter, pressure ulcers, and excess weight loss	MDS QM	5 pts each (clinical total 15; staffing total 20)	Below national average / improvement method per QuILTSS Manual
Bonus: Eden Alternative (Growth/Certified), AHCA/NCAL or TN Baldrige-type award within 3 years, CARF, or Joint Commission	state (validated by TennCare)	10 bonus pts, all or nothing	Must be current in the review period

Scoring period

Measured over a calendar year, with submissions due January 31. That year's score sets rates for the July 1 starting about 6 months later. QuILTSS #18 covers CY2025 and pays July 2026 to June 2027. CMS staffing data comes from the January Provider Information file (prior-year Q3). Clinical QMs cover Q4 two years back through Q3 of the prior year. So data is about 9 to 21 months old when the rate takes effect.

Payment formula

Domains total 100 points, plus up to 10 bonus. Tier cut points are fixed for at least 3 years and set at July 1: Tier 1 = 75 or more, Tier 2 = 50 to 74.99, Tier 3 = under 50. The tier sets the base-rate multipliers above. The stand-alone pool is split by Medicaid resident days times the percentage of total quality points earned (Rule .11(2)). The exact per-day conversion was not published.

Eligibility

All Medicaid-participating NFs. A facility loses the stand-alone payment if it does not submit complete, accurate and timely data (and is placed in Tier 3), if it is more than 30 days late on the assessment fee (applied as an MCO rate withhold), or if it submits false data (recoupment and False Claims Act exposure). New facilities are put in Tier 3 until they have 6 months of data. No IJ or SFF disqualifier appears in the rule.

Cadence

Scored once a year and applied at the July 1 rate setting. Paid every day of the rate year as part of the per diem.

Scores published

No public per-facility scores or payments found. Results reach facilities through Myers and Stauffer and rate sheets.

Notes

Sources: Rule 1200-13-02-.06(5)(a)2-3, (c)8(ix), .11; QuILTSS #18 memo; QuILTSS proposed-changes memo (Aug 2025); NF QuILTSS Operations Manual. The June 29, 2026 rule amendment moved staffing from 25 to 20 points and clinical from 10 to 15 points for July 2027 rates.

Verified October 11, 2026

Provider tax

Charged

% of net patient revenue

Standard amount

All assessments together equal 6% of net patient service revenue; most facilities pay an equal per-facility amount set to reach the 6% total (set each July 1, paid quarterly; extended through 6/30/2027 by Public Chapter 990)

Tiers

Who	Test	Amount
>= 35,000 Medicaid days a year	medicaid_utilization	2.75% of net patient revenue, charged per non-Medicare day
<= 50 beds	size	2.75% of net patient revenue, charged per non-Medicare day
CCRC units	ccrc	2.75% of net patient revenue, charged per non-Medicare day
Medicare-only SNFs	other	2.75% of net patient revenue, charged per non-Medicare day
new facilities	other	$2,225 per bed per year, prorated

Lower for high-Medicaid homes

yes

Returned in the rate

The Medicaid share of the assessment is paid back per day by provider class; the assessment also funds the rate system.

Source

https://capitol.tn.gov/Bills/113/Bill/SB0671.pdf

Verified October 11, 2026

Provider tax notes

Nursing Home Assessment under T.C.A. 71-5-1001 to -1010. All assessments together equal 6% of nursing facilities' net patient service revenue. Facilities with 50 or fewer beds, CCRC units, Medicare-only SNFs, and facilities with 35,000 or more Medicaid days a year pay 2.75% of their net patient revenue, charged per non-Medicare day. New facilities pay $2,225 per bed per year, prorated. All other facilities pay an equal per-facility amount set to reach the 6% total. The assessment is set each July 1 with one possible mid-year change and is paid quarterly. It goes back to facilities in two ways: the Medicaid share of the assessment is paid back per day by provider class, and the assessment funds the rate system. Public Chapter 345 (2025) extended it through June 30, 2026, and Public Chapter 990 (signed May 26, 2026) extended it through June 30, 2027. Sources: https://capitol.tn.gov/Bills/113/Bill/SB0671.pdf (structure, 2023) ; https://publications.tnsosfiles.com/acts/114/pub/pc0990.pdf

Verified October 11, 2026

Supplemental payments

There is no regular UPL or IGT program for nursing facilities in the documents reviewed. There is a CMS-approved state directed payment through the CHOICES MCOs: a uniform 3.03% increase on base reimbursement, paid as lump sums outside the regular rate. For calendar 2026 it is up to $39,062,500 ($25.06M federal, $14.0M state). It started in 2020 as COVID provider stabilization and has been renewed every year since. CMS treated the CY2024 version ($89,005,752) as likely grandfathered under section 71116 of Public Law 119-21. That means the total cannot rise. The 10-point-a-year phase-down from rating periods on or after January 1, 2028 applies only while a payment exceeds the cap (110% of the Medicare rate in a non-expansion state). CMS's proposed rule (CMS-2449-P, 91 FR 30400, May 22, 2026, p. 30420) says grandfathering has no practical effect where a payment is already at or below the limit. Base rates near $295/day plus 3.03% sit far below Medicare SNF rates, so no phase-down is expected; the rule is not final, and the payment still needs CMS renewal each year. Separately, the ERC respiratory add-on is paid through MCOs (see other_add_ons). Source: https://www.medicaid.gov/medicaid/managed-care/downloads/TN_F…

Verified October 14, 2026

Other add-ons

Enhanced Respiratory Care (ERC) add-on, paid per day on top of the regular rate, only in beds licensed for it. Current per-day amounts (High / Moderate / Low quality tier, effective July 1, 2025): ventilator weaning $600/$550/$450; chronic ventilator $390/$340/$290; sub-acute tracheal suctioning $200/$150/$100; secretion management $135/$85/$60; tracheal suctioning $135/$85/$60. Dialysis residents get higher amounts ($750 down to $210). The tier comes from ERC quality and technology points. New ERC contracts have been frozen since July 1, 2016 unless TennCare grants an exception (Rule .04, .12; ERC Operations Manual, April 2026). No separate add-ons for behavioral, bariatric, or Alzheimer's care were found. Bed holds are not paid (see bed_hold).

Verified October 11, 2026

Units paid separately

Enhanced Respiratory Care (ERC) is the only unit paid outside the standard rate. It is a per-day add-on through MCOs, only in beds licensed for it, and only at NFs contracted for ERC as of July 1, 2016 unless TennCare grants an exception. Levels are ventilator weaning, chronic ventilator, sub-acute tracheal suctioning, secretion management, and tracheal suctioning. The add-on depends on an ERC quality tier (High / Moderate / Low) and is higher for dialysis residents (amounts in other_add_ons). No separate brain-injury, pediatric, behavioral or IMD nursing facility rate was found in Rule 1200-13-02. Sources: Rule 1200-13-02-.04, .12; ERC Operations Manual (April 2026).

Verified October 11, 2026

Payment rules

Managed care for long-term care

Status

yes

Detail

TennCare CHOICES; all members are in MCOs

Verified October 11, 2026

Who pays

managed_ltss (TennCare CHOICES, Group 1 = nursing facility residents; all TennCare members are in MCOs under the 1115 demonstration; facilities must contract with at least one MCO)

Verified October 11, 2026

Managed care rate floor

Yes, and it is stricter than a floor. The MCO contract (Contractor Risk Agreement section A.2.13.3.1) says MCOs 'shall reimburse contract nursing facility ... providers at the per diem rate specified by TENNCARE, net of any applicable patient liability amount'. MCOs must also reprocess claims within 60 days when TennCare changes a rate after the fact (A.2.13.3.5). Rule 1200-13-02-.03(1) requires facilities to contract with at least one MCO, and T.C.A. 71-5-1412 requires MCOs to contract with any nursing facility. Sources: https://www.tn.gov/content/dam/tn/tenncare/documents/MCOState… ; https://publications.tnsosfiles.com/rules/1200/1200-13/1200-1…

Verified October 11, 2026

Included in the daily rate

Partly confirmed. The per diem is built only from routine SNF/NF cost centers. Direct costs of ancillary (non-routine) cost centers are excluded from rate setting (Rule 1200-13-02-.01(14)(d)), which means therapy, lab, radiology and other ancillaries are not funded through the per diem. Raw food and dietary supplements, including tube-feeding formulas, are in the rate (Rule .01(13)). TennCare outpatient drugs are carved out to the state's pharmacy benefits manager (Rule 1200-13-01 references the TennCare PBM). No TennCare document listing per-diem-included vs separately billable items (oxygen, DME, transport, supplies) was found.

Verified October 11, 2026

Bed hold

Hospital stays

Not paid. Medicaid bed-hold days have not been paid since July 1, 2018.

Leave days

Not paid (same rule).

Occupancy rule

Not applicable for nursing facilities. The 85% occupancy test in the MCO contract applies only to ICF/IID bed holds.

Notes

Rule 1200-13-02-.16. The State Plan's Attachment 4.19-C page posted on tn.gov is a scanned image and could not be read.

Source

https://publications.tnsosfiles.com/rules/1200/1200-13/1200-1…

Verified October 11, 2026

Personal needs allowance

Per month

70

Effective

2025-01-01

Notes

Public Chapter 986 (2024; HB 2321) rewrote TCA 71-5-147: for nursing home care on or after Jan. 1, 2025, a $70/month deduction is the personal needs allowance. Not COLA-indexed.

Confidence

confirmed

Source

https://publications.tnsosfiles.com/acts/113/pub/pc0986.pdf

Verified October 11, 2026

Medicare coinsurance days

Method

lesser_of

Rule

TennCare MCO Statewide Contract A.2.13.22 (all Medicare crossover claims, NF included; MCOs adjudicate crossovers under A.2.9.13.4): claim pays a $0 allowed amount when Medicare paid an amount equal to or greater than Medicaid's rate (maximum-allowed amount), and MCO payment plus Medicare payment may not exceed the lower of the Medicare or Medicaid allowed amount. TennCare rules 1200-13-01, 1200-13-13 and 1200-13-14 (current versions) contain no NF coinsurance pricing text; they mention crossover payments only in provider-registration context. No NF-specific exception exists, so the general contract rule governs.

Effect

On days 21-100 Medicare's per diem is usually well above the home's TennCare NF rate, so the home usually gets $0 of the coinsurance from TennCare.

Confidence

confirmed

Source

https://www.tn.gov/content/dam/tn/tenncare/documents/MCOState…

Medicare Advantage

not addressed: The contract (A.2.9.14) says D-SNPs stay responsible for Medicare SNF benefits for FBDE members and the MCO coordinates. Nothing sets what TennCare pays toward an MA plan's SNF cost-sharing. The crossover pricing rule (A.2.13.22) does not say whether it covers Part C.

Medicare Advantage source

https://www.tn.gov/content/dam/tn/tenncare/documents/MCOState…

Verified October 11, 2026

Required care spending

Applies

yes

Rule

Direct care spending floor by QuILTSS quality tier: Tier 1 = 90%, Tier 2 = 92%, Tier 3 = 94% of the facility's two direct-care rate parts (since 7/1/2021). If actual Medicaid direct-care cost per day (cost report 18+ months old, inflated and CMI-adjusted) falls below that, the shortfall is subtracted from the rate going forward. Downward-only; new providers exempt until their first reviewed cost report; qualifying CHOW buyers can ask for a provisional waiver. Rule 1200-13-02-.06(5)(a)3.

Source

https://publications.tnsosfiles.com/rules/1200/1200-13/1200-1…

Verified October 11, 2026

Occupancy rules

Applies

yes

Rule

Capital (fair rental value) and the real estate tax pass-through are divided by the greater of actual days or 85% occupancy of licensed beds, so homes under 85% get less per day for those parts. No occupancy-based rate cut, and no bed-hold occupancy test (bed hold is not paid). Rule 1200-13-02-.06(5)(c)-(d).

Source

https://publications.tnsosfiles.com/rules/1200/1200-13/1200-1…

Verified October 11, 2026

MDS accuracy penalties

Starting with MDS case-mix reviews that begin on or after July 1, 2026 (all earlier reviews were educational only). Myers and Stauffer reviews a sample: the greater of 30% or 20 assessments, 90% Medicaid, at least every 36 months. If more than 20% of the initial sample is unsupported, the sample is expanded. If more than 20% of all reviewed assessments are unsupported, the administrative and operating part of the rate is cut. First review: 0.50% (20.01-30%), 1.00% (30.01-40%), 1.50% (over 40%). Second consecutive: 2.5 / 3.0 / 3.5%. Third: 5.0 / 5.5 / 6.0%. Fourth: 7.5 / 8.0 / 8.5%. The cut applies to the next semi-annual rate, or the one after if the review finished within 2 months of the effective date. Lost money cannot be recovered. Sources: Rule 1200-13-02-.06(5)(b)5; TennCare memo 'MDS Reviews and Penalties' (June 29, 2026); Myers and Stauffer MDS review training (June 2024).

Verified October 11, 2026

Published rates and changes

How often rates change

A home's rate changes

semiannual

When

Jan 1 and Jul 1; full rate setting each Jul 1

Verified October 11, 2026

When rates change

Twice a year, January 1 and July 1. Each July 1 brings the full rate setting: index-factor inflation, a rebase when one is due, the new QuILTSS score and tier, licensed beds as of April 1, a new spending floor using a newer cost report, and a new BAF. Each January 1 brings a new semi-annual CMI, approved capital improvement requests, and a recalculated BAF. The rate year is the state fiscal year, July to June.

Verified October 11, 2026

Posted rates

Home-level rates published

No

Where

No public facility-level rate file was found on tn.gov/tenncare or the Myers and Stauffer TennCare page (https://myersandstauffer.com/provider-resources/tennessee/ten…). Myers and Stauffer emails rate sheets to each facility's contacts. The only public number is the statewide weighted average in TennCare's CHOICES cost-neutrality memo: $294.87/day effective 1/1/2026 and $286.10/day effective 1/1/2025 (https://www.tn.gov/content/dam/tn/tenncare/documents/RevisedC…).

Format

none (public). Each facility gets its own rate sheet by email; the file format is not confirmed.

Cadence

Rate sheets go out twice a year (January 1 and July 1). The statewide average is updated once a year in a December memo.

History

None publicly. Old statewide averages can be pieced together from past cost-neutrality cap memos.

Verified October 11, 2026

Rate build-ups

Published

No

Where

Private. Myers and Stauffer emails each facility its own rate sheet. The Tennessee case-mix web portal (https://tncasemixreports.mslc.com/) holds CMI rosters and review results, not public rate builds. A public records request to TennCare may be the only way to get them.

What they show

The 2018 Myers and Stauffer FAQ says the rate sheets show each component, including FRV details such as allowed land value versus appraised value, plus the prior-system comparison used during the phase-in. Statewide medians, prices, CMI, quality tier and BAF are presumably listed, but this was not confirmed.

Verified October 11, 2026

Recent changes

Verified October 11, 2026

Assisted living

Medicaid assisted living

Covered

yes

Program

TennCare CHOICES Assisted Care Living Facility (ACLF) Services, under the TennCare III Section 1115 demonstration (delivered through TennCare MCOs)

What is paid

Services only (personal care, homemaker, medication oversight). Room and board is paid by the member; TennCare caps the ACLF's room-and-board charge at 80% of the CHOICES personal needs allowance (300% of SSI FBR), $2,018.50/month in 2022.

Rate

Up to $1,305/month for ACLF services (TennCare memo dated 2021-12-14, effective 2022-01-01; not confirmed current)

Limits

CHOICES Groups 2 and 3 only (not Group 1); Group 2 HCBS cost capped at the cost of NF care; CHOICES enrollment targets apply

Source

https://www.tn.gov/content/dam/tn/tenncare/documents/ACLFMemo…

Verified October 11, 2026

Sources

1. Rules of TennCare Chapter 1200-13-02, Nursing Facility Provider Reimbursement (rev. June 2026) · regulation
2. Rules of TennCare Chapter 1200-13-02 (rev. Oct 2022, prior version for comparison) · regulation
3. TennCare MCO Statewide Contractor Risk Agreement, section A.2.13.3 · agency page
4. NF QuILTSS Operations Manual · agency page
5. NF QuILTSS #18 Memo (Sept 5, 2025) · agency page
6. NF QuILTSS Memo: Proposed Changes Pending Rule Approval (Aug 29, 2025) · agency page
7. Revised Cost Neutrality Caps for the CHOICES Program (Dec 18, 2025) · agency page
8. Enhanced Respiratory Care Operations Manual (April 2026) · agency page
9. CMS approval + preprint TN_Fee_NF_Renewal_20260101-20261231 (state directed payment) · agency page
10. Myers and Stauffer, Tennessee TennCare provider resources (rate setting contractor) · agency page
11. Myers and Stauffer FAQs - Case Mix Reimbursement System (2018) · agency page
12. Myers and Stauffer FAQ - September 2023 PDPM Webinar · agency page
13. TennCare memo: MDS Reviews and Penalties (June 29, 2026) · agency page
14. SB0671/HB0493 (2023) nursing home assessment, 6% structure · statute
15. Public Chapter 345 (2025) assessment extension · statute
16. Public Chapter 990 (2026) HB1864 as enacted, assessment extension to June 30, 2027 · statute
17. HB1864 as introduced (BAF/rebase codification, stripped by HA0697) · statute
18. TennCare State Plan Attachment 4.19-D (outdated Level I/II text) · state plan
19. Myers and Stauffer, MDS Verification Review Training slides (June 2024) · agency page
20. Rules of TennCare Chapter 1200-13-01, Long-Term Care Programs (rev. Oct 2025): .03 (points to 1200-13-02), .05 (CHOICES; Level 1/2 cost caps), .10 (NF level of care, acuity scale) · regulation
21. TennCare memo: 2022 Maximum Room and Board Charges for CHOICES ACLF Services (2021-12-14) · agency page
22. Medicare crossover / coinsurance rule · regulation
23. CMS proposed rule CMS-2449-P, Medicaid state directed payments (91 FR 30400, May 22, 2026), pp. 30420, 30450, 30463 · federal rule
24. Broad River Rehab, Tennessee Transition to PDPM for Medicaid CMI · secondary
25. Wellpoint TN CHOICES provider manual supplement (blended per diem; bed holds not billable) · secondary
26. Personal needs allowance · secondary

Other states

Alabama · Alaska · Arizona · Arkansas · California · Colorado · Connecticut · Delaware · District of Columbia · Florida · Georgia · Hawaii · Idaho · Illinois · Indiana · Iowa · Kansas · Kentucky · Louisiana · Maine · Maryland · Massachusetts · Michigan · Minnesota · Mississippi · Missouri · Montana · Nebraska · Nevada · New Hampshire · New Jersey · New Mexico · New York · North Carolina · North Dakota · Ohio · Oklahoma · Oregon · Pennsylvania · Rhode Island · South Carolina · South Dakota · Texas · Utah · Vermont · Virginia · Washington · West Virginia · Wisconsin · Wyoming