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PDPM Overview

The Patient Driven Payment Model (PDPM) represents the most significant change to skilled nursing reimbursement since the introduction of the Prospective Payment System (PPS) in 1998. PDPM is designed to shift the basis of reimbursement for Medicare from a volume driven model to one driven by patient clinical characteristics.

The primary criticism of the RUGS IV payment system was the emphasis on therapy minutes as the primary driver of reimbursement. RUGS IV focused on therapy volume rather than the overall clinical condition of the patient in determining the daily reimbursement. PDPM will focus on the various clinical characteristics of the patient to determine reimbursement for that patient. The biggest change for skilled nursing operators will be the importance of accurately capturing the full range of services being provided to each patient.

The shift from therapy volume to clinical characteristics naturally prompted questions about whether this change will result in less therapy minutes being delivered. According to CMS the answer should be a resounding NO. The rationale is if a facility was providing the appropriate number of therapy minutes and the clinical characteristics of their average patient does not suddenly change, then there should not be a change in the number of therapy minutes being provided. To stress this point CMS will require facilities to report the number of therapy minutes being delivered even though it does not factor into the reimbursement being provided. While the volume of therapy may not change initially there may be changes in the future based upon specific clinical pathways, a change in patient acuity and the ability of a facility to generate positive clinical outcomes that allow a patient to move on safely to the next most appropriate level of care.

If there should not be a significant change in the minutes of therapy being delivered, what will be different on October 1, 2019? The most notable changes will include greater collaboration between MDS and therapy in completing the MDS, less required assessments with only a five day and discharge assessment required and the interrupted stay policy which

PDPM Overview

The Patient Driven Payment Model (PDPM) represents the most significant change to skilled nursing reimbursement since the introduction of the Prospective Payment System (PPS) in 1998. PDPM is designed to shift the basis of reimbursement for Medicare from a volume driven model to one driven by patient clinical characteristics.

The primary criticism of the RUGS IV payment system was the emphasis on therapy minutes as the primary driver of reimbursement. RUGS IV focused on therapy volume rather than the overall clinical condition of the patient in determining the daily reimbursement. PDPM will focus on the various clinical characteristics of the patient to determine reimbursement for that patient. The biggest change for skilled nursing operators will be the importance of accurately capturing the full range of services being provided to each patient.

The shift from therapy volume to clinical characteristics naturally prompted questions about whether this change will result in less therapy minutes being delivered. According to CMS the answer should be a resounding NO. The rationale is if a facility was providing the appropriate number of therapy minutes and the clinical characteristics of their average patient does not suddenly change, then there should not be a change in the number of therapy minutes being provided. To stress this point CMS will require facilities to report the number of therapy minutes being delivered even though it does not factor into the reimbursement being provided. While the volume of therapy may not change initially there may be changes in the future based upon specific clinical pathways, a change in patient acuity and the ability of a facility to generate positive clinical outcomes that allow a patient to move on safely to the next most appropriate level of care.

If there should not be a significant change in the minutes of therapy being delivered, what will be different on October 1, 2019? The most notable changes will include greater collaboration between MDS and therapy in completing the MDS, less required assessments with only a five day and discharge assessment required and the interrupted stay policy which

RUGS IV to PDPM Crosswalk

Under RUGS IV therapy minutes and ADL scoring were the drivers of reimbursement. As such there was less incentive for a facility to accurately capture the extent of the services provided to a patient. PDPM will focus closely on the clinical characteristics of a patient and as such accurate coding will become much more important in order to receive the appropriate level of reimbursement from Medicare.

A facility level crosswalk will help to illustrate the impact the changes under PDPM will have on a facility’s Medicare reimbursement. In addition to the facility level crosswalk it is beneficial to conduct a crosswalk at the individual patient level to understand how differences in patient acuity along with what is captured can impact reimbursement.

At Ultimate Rehab we assist our clients in conducting an analysis similar to the one below to help understand how PDPM will impact their facility and how best to prepare for the coming changes under PDPM.

Understanding Group and Concurrent Therapy

One of the changes under PDPM is how group and concurrent therapy will be reimbursed. Concurrent therapy is when one therapist is treating two Medicare patients at the same time. This allows a therapist to begin an activity with one patient and then transition to a second patient while the first is engaged in the therapy activity, therapist continues to provide therapeutic intervention to each patient while they continue to work towards individual goals. Group therapy is when one therapist is treating up to four patients who are all working on the same goal. For example, four patients with lower extremity fracture all working to increase independence with adaptive equipment.

Some people are under the impression that doing group or concurrent therapy is a change from RUGS IV to PDPM. Under RUGS IV therapy was allowed to do group or concurrent therapy however total treatments for concurrent therapy was divided by two while total minutes under group therapy was divided by four and capped at 25% of the total therapy minutes. Under PDPM therapy will be allowed to do up to 25% of the total minutes for each patient in group or concurrent therapy per each therapy discipline.

This change is a positive financial change to therapy reimbursement however it does not mean that 25% of patient minutes will suddenly shift to either group or concurrent therapy. Before making the decision to provide therapy in a group or concurrent format there are a number of factors to consider including:

- Is this treatment mode the best for the clinical needs of the patient
- Is this form of therapy complex enough to require the clinical skills of a therapist
- How does it fit within the overall plan of care for the patient

In addition to understanding how group or concurrent therapy fits with a patient’s plan of care a facility needs to determine whether they have the therapy census to support this type of therapy. While group therapy has many benefits a facility with a smaller census may not have enough patients to make this type of therapy work on a consistent basis. It is also important to make sure that staff has experience in conducting group or concurrent therapy. Ultimate Rehab has developed clinical protocols to guide therapists in conducting both concurrent and group therapy. These protocols are designed to fit within a plan of care with a focus on generating strong clinical outcomes.

Therapy Support

The importance of accurately capturing services provided through coding cannot be understated. Under PDPM we can assist nursing in a variety of ways to help accurately capture services provided. These include:

  • Speech screens on all skilled admissions that will include areas from MDS section B0700 (makes self-understood), B0800 (ability to understand others), Section C (BIMS) C0200-C0500, Section K0100 (swallowing disorder) and Section K0510C (medically altered diet)
  • Occupational therapy and physical therapy will collaborate with IDT team on completion of section GG of MDS (Functional abilities and goals)
  • Occupational Therapy will collaborate with IDT in development of urinary toileting program (MDS section H0200C)
  • All three therapy disciplines will collaborate with the IDT team in recommendations for restorative nursing program (MDS section O0500)
  • Rehab Team Managers are trained to assist the IDT Team with ICD 10 coding

The collaboration between Nursing, MDS, and Therapy will be greater than ever. Ultimate Rehab is preparing our staff to assist in capturing the full range of services provided to the residents of the skilled nursing facilities we serve.

PDPM Answers

Unsure of the financial impact of PDPM on your facility? Unclear on the impact therapy can have under PDPM? Wondering if contract therapy is still the best option? For answers to these and other questions contact Tom MacDonald at 513 563-8777 or [email protected]