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Home Health Final Rule: Rate Increases plus PDGM

While I was in Philadelphia speaking at LeadingAge’s annual conference, CMS released its 2019 Home Health Final Rule.  As I wrote in an earlier post regarding the proposed rule, the topic of interest was/is a new payment model – PDGM.  As has been the case across the post-acute industry, CMS is advancing case-mix models crafted around a simplified patient assessment, less therapy oriented more nursing/medically balanced.  The industry lobbied for modification or delay in PDGM, primarily due to some underlying behavioral assumptions CMS embedded in the proposal (more on this in later paragraphs).

The most relevant, immediate impact of the final rule is rate increases (finally) for the industry – 2.2% or $420 million.  The industry has experienced rate cuts and rebasing consistently since 2010 as a response to fast growth and high profit margins exhibited by companies like Amedysis (the center of a Congressional hearing in 2011).

PDGM is slated to take effect “on or after January 1, 2020”.  The ambiguity in this language is worth noting as there are some that believe modification, even delay is possible.  Compared to the proposed rule, the final rule includes 216 more Home Health Resource Groups due to bifurcating Medication Management Teaching and Assessment from previous group alignments. The following key changes are a result of PDGM.

  1. As with PDPM on the SNF side, PDGM removes the therapy weight/influence separately from the assessment and payment element weights for HHAs.  The clinical indications or nursing considerations are given more weight along with patient comorbidities.
  2. Coding becomes a key factor in payment mechanics, particularly diagnoses and co-morbidity.
  3. Functional status is given a higher weight, as is the case today with all post-acute payment model reforms.
  4. Episode lengths are halved – down from 60 days (current) to 30 days.
  5. PDGM is budget neutral meaning that when fully implemented,, the cost to the Federal government for Medicare HHA payments in the aggregate is no greater than current (inflation adjusted for time).  To get to budget neutrality, certain behavioral assumptions about provide reactions to the changes are used.  As one would suspect, this is a subject of concern and debate by the HHA industry.

The behavioral assumption issue referenced in #5 above is an imputed reality in all payment model changes.  In fact, it is an economic model necessity when attempting to address “how” certain changes in reward (payment) will move activity or behavior toward those places where reward or payment is maximized.  It is a key economic behavioral axiom: What get’s rewarded, get’s done.

In effect, CMS is saying that budget neutrality is achieved for a 30 day episode when payments for the episode equal $1,753.68.  Getting to this number, CMS assumed that agencies would react or respond quickly to payment changes (areas where increases are found) in co-morbidity coding, clinical group assignment and reduction in LUPA cases.  However, if CMS models slower reactions or limited reactions by the industry (operating norms as current persist), the payment impact is an increase of 6.42% or $1,873.91.  Because budget neutrality is mandated concurrent with PDGM, the concerns providers are raising relates to how payments will ultimately be determined and when if necessary, will adjustments be made IF the anticipated behavioral changes don’t manifest as factored.  Simply stated, this collective concern(s) is the reason the industry continues to lobby for delay, more analysis and further definitional clarity with the PDGM funding and payment assumptions prior to implementation.

One final note with respect to PDGM dynamics.  Readers of my articles and attendees at lectures, webinars, other presentations have heard me discuss overall post-acute payment simplification and the movement within Medicare reimbursement to site neutrality.  PDGM is an interesting payment model from the standpoint that it parallels in many ways, the PDPM movement for SNFs.  It is diagnosis based, more clinically/nursing driven than the previous system and more holistic in capturing additional patient characteristics (co-morbidities) than before in order to address payment relevance. With assessment simplification and a growing focus on patient functional status at various points across a post-acute global episode (from hospital discharge to care completion), an overall framework is becoming more visible.  Expect continued work from CMS on payment simplification, more calls from MedPac for site neutral payments for post-acute care. The policy discussions are those that reinforce payment that follows the patient, based on patient clinical needs, unattached to any site dynamics or locations, save perhaps a coding modifier when inpatient care is warranted to account for the capital and equipment elements in the cost of care.  When looking globally at the overall health care payment and policy trend that is occurring sector by sector, the future of payment simplification and movement to site neutrality is certain.  One question remains: By when?

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November 6, 2018 Posted by | Home Health, Policy and Politics - Federal | , , , , , , , , , , , , | Leave a comment

SNF Final Rule 2019: Key Points and Provisions

Beginning yesterday, I’ve been following the news regarding CMS’ annual issuance of Final PPS rules for providers.  Of greatest interest is the SNF Final Rule as it includes a completely new payment system, departing from the RUGS IV, therapy-centric system currently in-place.  I’ve read through the Final Rule (all 424 mind-numbing pages) and summarized what SNFs need to know right now. I will undoubtedly expand upon the PDPM model as more is known and I’ve modeled claims via provider experience data.

RATE: The Final Rule includes a 2.4% increase to SNFs via adjustments to the RUGS IV categories/CMIs.  NOTE:  Providers that have not met their QRP (Quality Reporting) requirements/data submissions will receive a .04% increase – net of the 2% penalty.

SNF QRP: There were no changes made to the SNF QRPs in this rule.  The Claims-Based Measures of, 1) Community/Post-Acute discharge; 2) Preventable re-hospitalizations (30 days post discharge), and; 3) Spending per Medicare beneficiary (SNF) remain.  The Assessment-Based Measures of , 1) Falls with injury; 2) New or worsening pressure injuries post-admission, and; 3) Percent of patients with functional admission and discharge assessments and care plans.  CMS did indicate that it will adopt a “burden” or return on investment test for adoption or removal of future measures.

SNF VBP: The impact of Value-Based Purchasing begins Oct. 1, 2018. This incorporates an incentive payment or penalty reduction for the lone applicable quality measure: 30 day re-hospitalization rates post SNF discharge.  The Final Rule includes notably, an extraordinary circumstances exception policy plus discussion on future baseline periods for measurement, scoring changes, etc.

PDPM: This new payment system (Patient Driven Payment Model) is set to go into effect on October 1, 2019 (FY 2020). It will replace the RUGS IV system.  It is case-mix driven, utilizing the MDS assessment tool to categorize resident care needs via five case-mix categories: Physical Therapy, Occupational Therapy, Speech Therapy, Nursing, and Non-Therapy Ancillary requirements.  The base non-clinical case-mix category remains which captures the room and board and capital costs for SNFs (technical stuff here so no need for detail). As part of PDPM, only three assessments (MDS) are needed/required. The first is correlated to admission, the second to discharge and the third is related to change in condition/change in need.  Payment, regardless of service utilization, is assessment driven via each case-mix category.  Also gone from this system is any intensity measure of therapy services (no minute requirements or frequency). Added to the therapy requirements is a provision that as much as 25% (aggregate) of therapy treatment time can be group or concurrent.  Based on data provided, the unadjusted Federal Urban PDPM rate (10/1/2019) would be $410.85 (before labor/wage adjustments). The Unadjusted Rural PDPM rate would be $425.37.

As in the Proposed Rule, PDPM incorporates a variable rate concept.  The Final Rule maintained this concept unaltered.  After day 20, rates begin to decline at a pace equal to 2% every 7 days, starting at day 21.  The decline correlates to reductions in PT and OT rates (.03 per day) and a reduction in NTA (Non-Therapy Ancillary).  More below on Non-Therapy Ancillary inclusions.

Under PDPM, residents are classified/coded via ICD 10 into one (only one) of ten clinical categories corresponding to the primary reason for the inpatient stay. CMS intends to map ICD-10 codes into the clinical categories for providers.

  1. Major Joint Replacement or Spinal Surgery
  2. Cancer
  3. Non-Surgical Orthopedic/Musculoskeletal
  4. Pulmonary
  5. Orthopedic (that doesn’t fall into #1)
  6. Cardiovascular and Coagulations
  7. Acute Infections
  8. Acute Neurologic
  9. Medical Management
  10. Non-Orthopedic Surgery

To accommodate higher-cost, sicker patients in the SNF setting, PDPM implements a Non-Therapy Ancillary case-mix. The NTA categories are below.  Other than the first category of HIV/AIDS, each NTA is picked-up from a corresponding MDS item. Sorry for the length but I think the list is informative for providers.

HIV/AIDS 

Parenteral IV Feeding: Level High

Special Treatments/Programs: Intravenous Medication Post-admit

Special Treatments/Programs: Ventilator or Respirator Post-admit

Parenteral IV feeding: Level Low

Lung Transplant Status

Special Treatments/Programs: Transfusion Post-admit

Major Organ Transplant Status, Except Lung

Active Diagnoses: Multiple Sclerosis Code

Opportunistic Infections

Active Diagnoses: Asthma COPD Chronic Lung Disease Code

Bone/Joint/Muscle Infections/Necrosis – Except Aseptic Necrosis of Bone

Chronic Myeloid Leukemia

Wound Infection

Active Diagnoses: Diabetes Mellitus (DM)

Endocarditis

Immune Disorders

End-Stage Liver Disease

Other Foot Skin Problems: Diabetic Foot Ulcer

Narcolepsy and Cataplexy

Cystic Fibrosis

Special Treatments/Programs: Tracheostomy Care Post-admit

Active Diagnoses: Multi-Drug Resistant Organism (MDRO)

Special Treatments/Programs: Isolation Post-admit

Specified Hereditary Metabolic/Immune Disorders

Morbid Obesity

Special Treatments/Programs: Radiation Post-admit

Highest Stage of Unhealed Pressure Ulcer – Stage 4

Psoriatic Arthropathy and Systemic Sclerosis

Chronic Pancreatitis

Proliferative Diabetic Retinopathy and Vitreous Hemorrhage

Other Foot Skin Problems: Foot Infection Code, Other Open Lesion on Foot

Complications of Specified Implanted Device or Graft

Bladder and Bowel Appliances: Intermittent Catheterization

Inflammatory Bowel Disease

Aseptic Necrosis of Bone

Special Treatments/Programs: Suctioning Post-admit

Cardio-Respiratory Failure and Shock

Myelodysplastic Syndromes and Myelofibrosis

Systemic Lupus Erythematosus, Other Connective Tissue Disorders, and Inflammatory Spondylopathies

Diabetic Retinopathy – Except Proliferative Diabetic Retinopathy and Vitreous Hemorrhage

Nutritional Approaches While a Resident: Feeding Tube

Severe Skin Burn or Condition

Intractable Epilepsy

Active Diagnoses: Malnutrition

Disorders of Immunity – Except : RxCC97: Immune Disorders

Cirrhosis of Liver 

Bladder and Bowel Appliances: Ostomy

Respiratory Arrest

Pulmonary Fibrosis and Other Chronic Lung Disorders

Summary: Ten clinical categories essentially begin the coding process (reason for admit).  From this point, each case-mix category is developed (PT, OT, SLP, Nursing and NTA). This is done via the admission MDS.  The rate is constant for days 1-20 of the stay.  Beginning on day 21, the rate reduces equal to 2% every additional 7 days.  A change of condition MDS can occur, altering the rate variability (reduction) by change in patient need.  One more assessment (MDS) is completed to recap the stay at discharge and capture QRP data.  In the meantime, stay tuned for additional information and strategic tips on how to prepare for PDPM and what specifically, to know in interpreting the “best path/best-practices” at the facility level.

 

August 1, 2018 Posted by | Skilled Nursing | , , , , , , , , , , , | 2 Comments

SNF PPS Final Rule 2019

Yesterday I wrote a quick post regarding the news that CMS was about to issue the SNF Final Rule for Fiscal Year 2019.  Today, the text is available.  Official publication in the Federal Register is set for August 8th.  Readers may access the text here: SNF 2019 Final Rule

I will have analysis and more information available regarding the Final Rule implications for providers later today.  NOTE: Biggest implications center on the shift away from RUGS IV to PDPM (new payment model).  That shift/change occurs 10/1/19 unless otherwise delayed.  On this site, on the Reports and Other Documents page, there is a PDPM calculation worksheet for download.  You can also access it here via this link: PDPM Calculation for SNFs

The worksheet is a good tool/review to grasp the basic mechanics of PDPM and how rates are/will be derived.

August 1, 2018 Posted by | Skilled Nursing | , , , , , , , , , , , | 1 Comment

CMS Final SNF PPS Rule for 2019: Increases plus PDPM

Late this afternoon, I caught news that CMS will release a number of Final Rules impacting post-acute providers over the next few days.  Below is a quick summary of what is known for SNFs.  I will update this information as I get access to the Final Rule.

  • PPS rates (manual) to adjust by 2.4% (increase).
  • A final version of PDPM is included in the Final Rule.  Implementation steps including dates won’t be known until the Final Rule is issued and likely, there will still be some “fill-in-the-blanks” that will be later developed and issued. The good news is that the assessment and documentation changes that were part of the PDPM proposal remain.
  • There will be some quality measure changes forthcoming as CMS’ Meaningful Measure Initiative is tasked with weighing cost vs. benefit across provider measures.  It will be some time however, before it is clear which measure changes will occur and the impact.  Important to know: Changes in meaningful measures impact QRP and ultimately, Value Based Purchasing/Pay for Performance for providers.  It is important that SNFs pay close attention to these measures as their use is beyond reporting; now reimbursement correlated and compliance correlated as well (new survey process is very similar in many ways to QIS – data driven).

More information on this topic once the Final Rule is public.

July 31, 2018 Posted by | Uncategorized | , , , , , , , , , , | Leave a comment

CMS Releases Final Rule on SNF Conditions of Participation

The long-awaited final rule on the revised/new SNF Conditions of Participation is set for publishing on October 4 in the Federal Register. The public inspection version is available now, including the comments from the Proposed Rule at this link: https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-23503.pdf  The whole document is over 900 pages.  The salient portions that include the regulatory changes/summary of provisions is the first 14 or so pages.

Two things to remember for policy readers and folks in the industry.  First, what is available is the “law” not the interpretive guidelines that expands on the law in a way that creates enforcement regulations and the roadmap or “how to”.  The Final Rule is absent this information.  CMS still needs to develop this element.  Second, implementation will occur in phases.  The first phase is set for November 28, 2016 with minor changes that most providers should be ready for or are parts (related or integrated) from annual rule releases/updates (CMS updates PPS for each provider segment annually) already disclosed.  For example, QMs that translate into this rule regarding unnecessary drugs, antipsychotics-psychotics, etc.  These are now encapsulated in the rule but frankly, not new in scope.  The second phase is November 2017 and the third phase, 2019.

In November of last year, concurrent with the release of the Proposed Final Rule, I wrote a piece and did a webinar for HCPro on this topic.  The written piece is here: http://wp.me/ptUlY-iT  In my review of the two, what I though would move forward fundamentally “intact” did. What I was concerned about however, didn’t change much based on the over 10,000 comments.  There is definitely, a “Camel’s nose under the tent” element with regard to staffing requirements; though not an overt regulation.  The devilish elements are around the “facility assessments” for  staff adequacy and competency, etc. and the food service requirement to meet individual preferences plus serve nutritionally adequate, palatable meals, etc.  As one of the main issues in any environment remains food (always a certain number of complaints), this one could prove very, very prickly when it comes to survey/enforcement.  The summary of changes/provisions is below, as published.

  • Basis and scope (§483.1)

 We have added the statutory authority citations for sections 1128I(b) and (c) and section

1150B of the Social Security Act (the Act) to include the compliance and ethics program,

quality assurance and performance improvement (QAPI), and reporting of suspicion of a

crime requirements to this section.

  • Definitions (§483.5)

 We have added the definitions for “abuse”, “adverse event”, “exploitation”,

“misappropriation of resident property”, “mistreatment”, “neglect”, “person-centered

care”, “resident representative”, and “sexual abuse” to this section.

  • Resident rights (§483.10)

 We are retaining all existing residents’ rights and updating the language and organization

of the resident rights provisions to improve logical order and readability, clarify aspects

of the regulation where necessary, and updating provisions to include advances such as

electronic communications.

  • Freedom from abuse, neglect, and exploitation (§483.12)

 We are requiring facilities to investigate and report all allegations of abusive conduct.

We also are specifying that facilities cannot employ individuals who have had a

disciplinary action taken against their professional license by a state licensure body as a

result of a finding of abuse, neglect, mistreatment of residents or misappropriation of

their property.

  • Admission, transfer, and discharge rights (§483.15)

 We are requiring that a transfer or discharge be documented in the medical record and

that specific information be exchanged with the receiving provider or facility when a

resident is transferred.

  • Resident assessments (§483.20)

 We are clarifying what constitutes appropriate coordination of a resident’s assessment

with the Preadmission Screening and Resident Review (PASARR) program under

Medicaid. We are also adding references to statutory requirements that were

inadvertently omitted from the regulation when we first implemented sections 1819 and

1919 of the Act.

  • Comprehensive Person-Centered Care Planning (§483.21) *New Section*

 We are requiring facilities to develop and implement a baseline care plan for each

resident, within 48 hours of their admission, which includes the instructions needed to

provide effective and person-centered care that meets professional standards of quality

care.

 We are adding a nurse aide and a member of the food and nutrition services staff to the

required members of the interdisciplinary team that develops the comprehensive care

plan.

 We are requiring that facilities develop and implement a discharge planning process that

focuses on the resident’s discharge goals and prepares residents to be active partners in

post-discharge care, in effective transitions, and in the reduction of factors leading to

preventable re-admissions. We are also implementing the discharge planning

requirements mandated by The Improving Medicare Post-Acute Care Transformation Act

of 2014 (IMPACT Act) by revising, or adding where appropriate, discharge planning

requirements for LTC facilities.

  • Quality of care (§483.24)

 We are requiring that each resident receive and the facility provide the necessary care and

services to attain or maintain the highest practicable physical, mental, and psychosocial

well-being, consistent with the resident’s comprehensive assessment and plan of care.

  • Quality of Life (§483.25)

 Based on the comprehensive assessment of a resident, we are requiring facilities to ensure

that residents receive treatment and care in accordance with professional standards of

practice, the comprehensive person-centered care plan, and the residents’ choices.

  • Physician services (§483.30)

 We are allowing attending physicians to delegate dietary orders to qualified dietitians or

other clinically qualified nutrition professionals and therapy orders to therapists.

  • Nursing services (§483.35)

 We are adding a competency requirement for determining the sufficiency of nursing staff,

based on a facility assessment, which includes but is not limited to the number of

residents, resident acuity, range of diagnoses, and the content of individual care plans.

  • Behavioral health services (§483.40)

 We are adding a new section to subpart B that focuses on the requirement to provide the

necessary behavioral health care and services to residents, in accordance with their

comprehensive assessment and plan of care.

 We are adding “gerontology” to the list of possible human services fields from which a

bachelor degree could provide the minimum educational requirement for a social worker.

  • Pharmacy services (§483.45)

 We are requiring that a pharmacist review a resident’s medical chart during each monthly

drug regimen review.

 We are revising existing requirements regarding “antipsychotic” drugs to refer to

“psychotropic” drugs and define “psychotropic drug” as any drug that affects brain

activities associated with mental processes and behavior. We are requiring several

provisions intended to reduce or eliminate the need for psychotropic drugs, if not

clinically contraindicated, to safeguard the resident’s health.

  • Laboratory, radiology, and other diagnostic services (§483.50) *New Section*

 We are clarifying that a physician assistant, nurse practitioner or clinical nurse specialist

may order laboratory, radiology, and other diagnostic services for a resident in

accordance with state law, including scope-of-practice laws.

  • Dental services (§483.55)

 We are prohibiting SNFs and NFs from charging a Medicare resident for the loss or

damage of dentures determined in accordance with facility policy to be the facility’s

responsibility, and we are adding a requirement that the facility have a policy identifying

those instances when the loss or damage of dentures is the facility’s responsibility. We

are requiring NFs to assist residents who are eligible to apply for reimbursement of dental

services under the Medicaid state plan, where applicable.

 We are clarifying that with regard to a referral for lost or damaged dentures “promptly”

means that the referral must be made within 3 business days unless there is

documentation of extenuating circumstances.

  • Food and nutrition services (§483.60)

 We are requiring facilities to provide each resident with a nourishing, palatable, well balanced

diet that meets his or her daily nutritional and special dietary needs, taking into

consideration the preferences of each resident. We are also requiring facilities to employ

sufficient staff, including the designation of a director of food and nutrition service, with

the appropriate competencies and skills sets to carry out the functions of dietary services

while taking into consideration resident assessments and individual plans of care,

including diagnoses and acuity, as well as the facility’s resident census.

  • Specialized rehabilitative services (§483.65)

 We have added respiratory services to those services identified as specialized

rehabilitative services.

  • Administration (§483.70)

 We have largely relocated various portions of this section into other sections of subpart B

as deemed appropriate.

 We require facilities to conduct, document, and annually review a facility-wide

assessment to determine what resources are necessary to care for its residents

competently during both day-to-day operations and emergencies. Facilities are required

to address in the facility assessment the facility’s resident population (that is, number of

residents, overall types of care and staff competencies required by the residents, and

cultural aspects), resources (for example, equipment, and overall personnel), and a

facility-based and community-based risk assessment.

 Binding Arbitration Agreements: We are requiring that facilities must not enter into an

agreement for binding arbitration with a resident or their representative until after a

dispute arises between the parties. Thus, we are prohibiting the use of pre-dispute

binding arbitration agreements.

  • Quality assurance and performance improvement (QAPI) (§483.75)

 We are requiring all LTC facilities to develop, implement, and maintain an effective

comprehensive, data-driven QAPI program that focuses on systems of care, outcomes of

care and quality of life.

  • Infection control (§483.80)

 We are requiring facilities to develop an Infection Prevention and Control Program (IPCP)

that includes an Antibiotic Stewardship Program and designate at least one Infection

Preventionist (IP).

  • Compliance and ethics program (§483.85) *New Section*

 We are requiring the operating organization for each facility to have in effect a compliance

and ethics program that has established written compliance and ethics standards, policies

and procedures that are capable of reducing the prospect of criminal, civil, and

administrative violations in accordance with section 1128I(b) of the Act.

  • Physical environment (§483.90)

 We are requiring facilities that are constructed, re-constructed, or newly certified after the

effective date of this regulation to accommodate no more than two residents in a bedroom.

We are also requiring facilities that are constructed, or newly certified after the effective

date of this regulation to have a bathroom equipped with at least a commode and sink in

each room.

  • Training requirements (§483.95) *New Section*

 We are adding a new section to subpart B that sets forth all the requirements of an

effective training program that facilities must develop, implement, and maintain for all

new and existing staff, individuals providing services under a contractual arrangement,

and volunteers, consistent with their expected roles.

Stay tuned.  I will have more forthcoming as survey guidelines come out, implementation is sorted, etc.

September 30, 2016 Posted by | Skilled Nursing | , , , , , , , , , , | Leave a comment