October 1, 2019 marks a significant day in the healthcare industry. The Patient Driven Payment Model (PDPM) will be replacing the Resource Utilization Groups-Version 4 (RUG-IV) for Medicare Part A payment in skilled nursing facilities. This is big news because it’s been more than 20 years since the RUG system was implemented. So it’s understandable if there’s some concern about what this could mean for your patients and your business.
To help you prepare for this changeover, Casamba has put together a list of five things you need to know about PDPM before it goes live:
The clock is ticking for therapy minutes
With this transition, no longer will therapy minutes be used as a basis for therapy payment. According to the Centers for Medicare & Medicaid Services (CMS), this move is significant because it mitigates “financial incentives to provide excessive therapy and (improves) allocation of system resources to medically complex beneficiaries.”
Paperwork is shredded
With a streamlined process and a reduced number of payment group combinations, PDPM could generate significant cost savings and reduced paperwork. According to CMS, PDPM could save facilities $2 billion over 10 years. “For skilled nursing facilities, we are taking important steps through proposed payment improvements that will reduce administrative burden, and foster innovation to improve care and quality for patients,” CMS administrator Seema Verma said in 2018.
Section GG – All In
With the new payment model, Section G is being replaced with GG as the functional component for PT, OT and nursing. This means there will be standard outcome measures in every post-acute care (PAC) venue. Also, definitions and descriptions of the activities (e.g., eating, oral hygiene, toileting) and the instructions on how to score items will be standardized.
ICD-10 Case Mix Classification System
ICD-10 diagnosis codes as well as additional patient characteristics are used by PDPM to determine a patient’s classification. Under PDPM, patients will be classified and the facilities are reimbursed based on five categories — nursing, occupational therapy, physical therapy, speech language pathology and non-therapy ancillary services.
Operators should rethink workflow
As with any policy change, PDPM is going to require people to rethink how they run certain parts of their business. In a 2018 interview with McKnight’s, Cynthia Morton, executive vice president of the National Association for the Support of Long Term Care, said, “PDPM will require the facility to rethink its workflow processes because the patient will need to be assessed much more accurately.” She goes on to note that PDPM could even require facilities make staffing changes.
PDPM will be here before you know it. And that’s all the more reason to begin your preparation and planning now. If you have any questions about PDPM, please call one of Casamba’s experts at 800-648-2596.