2
• AIDS: Acquired Immune Deficiency Syndrome
• ARD: Assessment Reference Date
• BIMS: Brief Interview for Mental Status
• CMI: Case-mix Index
• CMS: Centers for Medicare and Medicaid Services
• COT: Change of Therapy
• CFS: Cognitive Function Scale
• CPS: Cognitive Performance Scale
• HIPPS: Health Insurance Prospective Payment System
• HIV: Human Immunodeficiency Virus
• ICD-10-CM: International Classification of Diseases, Tenth Revision, Clinical Modification
• IPA: Interim Payment Assessment
• MDS 3.0: Minimum Data Set, Version 3
• NF: Nursing Facility
• NTA: Non-Therapy Ancillary
Acronyms in this Presentation
3
• OBRA: Omnibus Budget Reconciliation Act of 1987
• OMRA: Other Medicare-Required Assessment
• OSA: Optional State Assessment
• OT: Occupational Therapy
• PDPM: Patient Driven Payment Model
• PPS: Prospective Payment System
• PT: Physical Therapy
• RUG-IV: Resource Utilization Group, Version IV
• SLP: Speech Language Pathology
• SNF: Skilled Nursing Facility
• UPL: Upper Payment Limit
• VPD: Variable Per Diem
Acronyms in this Presentation
4
• PDPM Overview
• Patient Classification Under PDPM
• Patient Classification Example
• MDS Related Changes
• Concurrent & Group Therapy Limit
• Interrupted Stay Policy
• Administrative Presumption
• Payment for Patients with AIDS
• Revised HIPPS Coding
• RUG-IV – PDPM Transition
• Medicaid Related Issues
• Resources
Agenda
6
• Issues with the current case-mix model, the Resource Utilization Groups, Version IV (RUG-IV)
have been identified by CMS, the Office of Inspector General, the Medicare Payment Advisory
Commission, the media, and others:
• Therapy payments under the Skilled Nursing Facility (SNF) Prospective Payment System (PPS) are based
primarily on the amount of therapy provided to a patient, regardless of the patient’s unique characteristics,
needs, or goals
• The Patient Driven Payment Model (PDPM), effective October 1, 2019, will improve payments
made under the SNF PPS in the following ways:
• Improves payment accuracy and appropriateness by focusing on the patient, rather than the volume of
services provided
• Significantly reduces administrative burden on providers
• Improves SNF payments to currently underserved beneficiaries without increasing total Medicare
payments
Project Overview
8
• PDPM consists of five case-mix adjusted components, all based on data-driven, stakeholder-vetted
patient characteristics:
• Physical Therapy (PT)
• Occupational Therapy (OT)
• Speech Language Pathology (SLP)
• Nursing
• NTA
• PDPM also includes a “Variable Per Diem (VPD) adjustment” that adjusts the per diem rate over the
course of the stay
PDPM Components
13
• Under PDPM, each patient is classified into a group for each of the five case-mix adjusted
components: PT, OT, SLP, Nursing and NTA
• Each component utilizes different criteria as the basis for patient classification:
• PT: Clinical Category, Functional Score
• OT: Clinical Category, Functional Score
• SLP: Presence of Acute Neurologic Condition, SLP-related Comorbidity or Cognitive Impairment,
Mechanically-altered Diet, Swallowing Disorder
• Nursing: Same characteristics as under RUG-IV
• NTA: NTA Comorbidity Score
PDPM Patient Classification
14
• Under RUG-IV, the number of PT, OT, and SLP therapy treatment minutes are combined for a total
number of treatment minutes that is used to classify a given patient into a given therapy RUG
• Under PDPM, patient characteristics will be used to predict the therapy costs associated with a given
patient, rather than rely on service use
• For the PT & OT components, two classifications are used:
• Clinical Category
• Functional Status
PT & OT Components: RUG-IV & PDPM
15
• SNF patients are first classified into a clinical category based on the primary diagnosis for the SNF
stay
• International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) codes,
coded on the Minimum Data Set (MDS) in Item I0020B, are mapped to a PDPM clinical category:
• Clinical classification may be adjusted by a surgical procedure that occurred during the prior inpatient stay,
as coded in Section J
• ICD-10 mapping available on the PDPM webpage
PDPM Clinical Categories
PDPM Clinical Categories
Major Joint Replacement or Spinal Surgery Cancer
Non-Surgical Orthopedic/Musculoskeletal Pulmonary
Orthopedic - Surgical Extremities not Major Joint Cardiovascular and Coagulations
Acute Infections Acute Neurologic
Medical Management Non-Orthopedic Surgery
16
• Based on data showing similar costs among certain clinical categories, the PT & OT components use
four collapsed clinical categories for patient classification:
PT & OT Clinical Categories
PDPM Clinical Categories PT & OT Clinical Categories
Major Joint Replacement or Spinal Surgery Major Joint Replacement or Spinal Surgery
Acute Neurologic
Non-Orthopedic Surgery & Acute Neurologic
Non-Orthopedic Surgery
Non-Surgical Orthopedic/Musculoskeletal
Other Orthopedic
Orthopedic - Surgical Extremities Not Major Joint
Medical Management
Medical Management
Cancer
Pulmonary
Cardiovascular & Coagulations
Acute Infections
17
• PDPM advances CMS’ goal of using standardized assessment items across payment settings by
using items in Section GG of the MDS as the basis for patient functional assessments
• The functional score for the PT & OT components is calculated as the sum of the scores on ten
Section GG items:
• Two bed mobility items
• Three transfer items
• One eating item
• One toileting item
• One oral hygiene item
• Two walking items
PT & OT Functional Score
18
• Section GG items included in the PT & OT Functional Score:
PT & OT Functional Score: GG Items
Section GG Item
Functional Score
Range
GG0130A1 – Self-care: Eating 0 – 4
GG0130B1 – Self-care: Oral Hygiene 0 – 4
GG0130C1 – Self-care: Toileting Hygiene 0 – 4
GG0170B1 – Mobility: Sit to Lying
0 – 4
(average of 2 items)
GG0170C1 – Mobility: Lying to Sitting on side of bed
GG0170D1 – Mobility: Sit to Stand
0 – 4
(average of 3 items)
GG0170E1 – Mobility: Chair/bed-to-chair transfer
GG0170F1 – Mobility: Toilet Transfer
GG0170J1 – Mobility: Walk 50 feet with 2 turns
0 – 4
(average of 2 items)
GG0170K1 – Mobility: Walk 150 feet
19
• Section GG items included in the Nursing Functional Score:
Nursing Functional Score: GG Items
Section GG Item
Functional Score
Range
GG0130A1 – Self-care: Eating 0 – 4
GG0130C1 – Self-care: Toileting Hygiene 0 – 4
GG0170B1 – Mobility: Sit to Lying
0 – 4
(average of 2 items)
GG0170C1 – Mobility: Lying to Sitting on side of bed
GG0170D1 – Mobility: Sit to Stand
0 – 4
(average of 3 items)
GG0170E1 – Mobility: Chair/bed-to-chair transfer
GG0170F1 – Mobility: Toilet Transfer
20
• PT & OT and Nursing Functional Score Construction (Non-walking Items)
Functional Score: Item Response Crosswalk (1)
Item Response Score
05, 06 – Set-up Assistance, Independent 4
04 – Supervision or touching assistance 3
03 – Partial/Moderate assistance 2
02 – Substantial/Maximal assistance 1
01, 07, 09, 10, 88, missing – Dependent, Refused, Not applicable, Not attempted due to
environmental limitations, Not Attempted due to medical condition or safety concerns
0
21
• PT & OT Functional Score Construction (Walking Items)
Functional Score: Item Response Crosswalk (2)
Item Response Score
05, 06 – Set-up Assistance, Independent 4
04 – Supervision or touching assistance 3
03 – Partial/Moderate assistance 2
02 – Substantial/Maximal assistance 1
01, 07, 09, 10, 88, missing – Dependent, Refused, Not applicable, Not attempted due to
environmental limitations, Not Attempted due to medical condition or safety concerns,
Resident Cannot Walk (Coded based on response to GG0170I1)
0
22
• Notable differences between G and GG scoring methodologies:
• Reverse scoring methodology:
• Under Section G, increasing score means increasing dependence
• Under Section GG, increasing score means increasing independence
• Non-linear relationship to payment:
• Under RUG-IV, increasing dependence, within a given RUG category, translates to higher payment
• Under PDPM, there is not a direct relationship between increasing dependence and increasing
payment
• Example: For the PT & OT component, payment for three clinical categories is lower for the most
and least dependent patients (who are less likely to require high therapy amounts of therapy),
compared to those in between (who are more likely to require high amounts of therapy)
RUG-IV & PDPM Functional Score Differences
23
PT & OT Components: Payment Groups
Clinical Category
PT & OT
Function Score
PT & OT
Case Mix Group
PT CMI OT CMI
Major Joint Replacement or Spinal Surgery 0-5 TA 1.53 1.49
Major Joint Replacement or Spinal Surgery 6-9 TB 1.69 1.63
Major Joint Replacement or Spinal Surgery 10-23 TC 1.88 1.68
Major Joint Replacement or Spinal Surgery 24 TD 1.92 1.53
Other Orthopedic 0-5 TE 1.42 1.41
Other Orthopedic 6-9 TF 1.61 1.59
Other Orthopedic 10-23 TG 1.67 1.64
Other Orthopedic 24 TH 1.16 1.15
Medical Management 0-5 TI 1.13 1.17
Medical Management 6-9 TJ 1.42 1.44
Medical Management 10-23 TK 1.52 1.54
Medical Management 24 TL 1.09 1.11
Non-Orthopedic Surgery and Acute Neurologic 0-5 TM 1.27 1.30
Non-Orthopedic Surgery and Acute Neurologic 6-9 TN 1.48 1.49
Non-Orthopedic Surgery and Acute Neurologic 10-23 TO 1.55 1.55
Non-Orthopedic Surgery and Acute Neurologic 24 TP 1.08 1.09
24
• For the SLP component, PDPM uses a number of different patient characteristics that were
predictive of increased SLP costs:
• Acute Neurologic clinical classification
• Certain SLP-related comorbidities
• Presence of cognitive impairment
• Use of a mechanically-altered diet
• Presence of swallowing disorder
SLP Component
25
• Twelve SLP comorbidities were identified as predictive of higher SLP costs:
• Conditions and services combined into a single SLP-related comorbidity flag
• Patient qualifies if any of the conditions/services is present
• A mapping between ICD-10 codes and the SLP comorbidities is available on the PDPM webpage
SLP-Related Comorbidities
SLP Comorbidities
Aphasia Laryngeal Cancer
CVA,TIA, or Stroke Apraxia
Hemiplegia or Hemiparesis Dysphagia
Traumatic Brain Injury ALS
Tracheostomy (while Resident) Oral Cancers
Ventilator (while Resident) Speech & Language Deficits
26
• Under RUG-IV, a patient’s cognitive status is assessed using the Brief Interview for Mental Status
(BIMS):
• In cases where the BIMS cannot be completed, providers are required to perform a staff assessment for
mental status
• The Cognitive Performance Scale (CPS) is then used to score the patient’s cognitive status based on the
results of the staff assessment
• Under PDPM, a patient’s cognitive status is assessed in exactly the same way as under RUG-IV
(i.e., via the BIMS or staff assessment):
• Scoring the patient’s cognitive status, for purposes of classification, is based on the Cognitive Function
Scale (CFS), which is able to provide consistent scoring across the BIMS and staff assessment
PDPM Cognitive Scoring
28
SLP Component: Payment Groups
Presence of Acute Neurologic Condition,
SLP Related Comorbidity, or Cognitive
Impairment
Mechanically Altered
Diet or Swallowing
Disorder
SLP Case Mix
Group
SLP Case Mix
Index
None Neither SA 0.68
None Either SB 1.82
None Both SC 2.66
Any one Neither SD 1.46
Any one Either SE 2.33
Any one Both SF 2.97
Any two Neither SG 2.04
Any two Either SH 2.85
Any two Both SI 3.51
All three Neither SJ 2.98
All three Either SK 3.69
All three Both SL 4.19
29
• RUG-IV classifies patients into a therapy RUG, based on how much therapy the patient receives,
and a non-therapy RUG, based on certain patient characteristics:
• Only one of these RUGs is used for payment purposes
• Therapy RUGs are used to bill for over 90% of Part A days
• Therapy RUGs use a consistent nursing case-mix adjustment, which obscures clinically meaningful
differences in nursing characteristics between patients in the same therapy RUG
• PDPM utilizes the same basic nursing classification structure as RUG-IV, with certain modifications:
• Function score based on Section GG of the MDS 3.0
• Collapsed functional groups, reducing the number of nursing groups from 43 to 25
Nursing Component
30
Nursing Component: Payment Groups (1)
RUG-IV
Nursing
RUG
Extensive Services Clinical Conditions Depression
Restorative
Nursing
Services
Function
Score
CMG CMI
ES3
Tracheostomy &
Ventilator
0-14 ES3 4.04
ES2
Tracheostomy or
Ventilator
0-14 ES2 3.06
ES1 Infection Isolation 0-14 ES1 2.91
HE2/HD2
Serious medical conditions e.g.
comatose, septicemia, respiratory
therapy
Yes 0-5 HDE2 2.39
HE1/HD1
Serious medical conditions e.g.
comatose, septicemia, respiratory
therapy
No 0-5 HDE1 1.99
HC2/HB2
Serious medical conditions e.g.
comatose, septicemia, respiratory
therapy
Yes 6-14 HBC2 2.23
HC1/HB1
Serious medical conditions e.g.
comatose, septicemia, respiratory
therapy
No 6-14 HBC1 1.85
31
Nursing Component: Payment Groups (2)
RUG-IV
Nursing
RUG
Extensive
Services
Clinical Conditions Depression
Restorative
Nursing
Services
Function
Score
CMG CMI
LE2/LD2
Serious medical conditions e.g. radiation therapy
or dialysis
Yes 0-5 LDE2 2.07
LE1/LD1
Serious medical conditions e.g. radiation therapy
or dialysis
No 0-5 LDE1 1.72
LC2/LB2
Serious medical conditions e.g. radiation therapy
or dialysis
Yes 6-14 LBC2 1.71
LC1/LB1
Serious medical conditions e.g. radiation therapy
or dialysis
No 6-14 LBC1 1.43
CE2/CD2
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
Yes 0-5 CDE2 1.86
CE1/CD1
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
No 0-5 CDE1 1.62
CC2/CB2
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
Yes 6-14 CBC2 1.54
CA2
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
Yes 15-16 CA2 1.08
32
Nursing Component: Payment Groups (3)
RUG-IV
Nursing
RUG
Extensive
Services
Clinical Conditions Depression
Restorative
Nursing
Services
Function
Score
CMG CMI
CC1/CB1
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
No 6-14 CBC1 1.34
CA1
Conditions requiring complex medical care e.g.
pneumonia, surgical wounds, burns
No 15-16 CA1 0.94
BB2/BA2 Behavioral or cognitive symptoms 2 or more 11-16 BAB2 1.04
BB1/BA1 Behavioral or cognitive symptoms 0-1 11-16 BAB1 0.99
PE2/PD2
Assistance with daily living and general
supervision
2 or more 0-5 PDE2 1.57
PE1/PD1
Assistance with daily living and general
supervision
0-1 0-5 PDE1 1.47
PC2/PB2
Assistance with daily living and general
supervision
2 or more 6-14 PBC2 1.21
PA2
Assistance with daily living and general
supervision
2 or more 15-16 PA2 0.7
PC1/PB1
Assistance with daily living and general
supervision
0-1 6-14 PBC1 1.13
PA1
Assistance with daily living and general
supervision
0-1 15-16 PA1 0.66
33
• NTA classification is based on the presence of certain comorbidities or use of certain extensive
services
• We considered various options to incorporate comorbidities into payment:
• Total number of comorbidities is linked to NTA costs, but a simple count of conditions overlooks differences
in relative costliness
• A tier system accounts for differences in relative costliness but does not account for the number of
comorbidities
• Comorbidity score is a weighted count of comorbidities:
• Comorbidities associated with high increases in NTA costs grouped into various point tiers
• Points assigned for each additional comorbidity present, with more points awarded for higher-cost tiers
NTA Component
34
• Comorbidities and extensive services for NTA classification are derived from a variety of MDS
sources, with some comorbidities identified by ICD-10-CM codes reported in Item I8000
• A mapping between ICD-10-CM codes and NTA comorbidities used for NTA classification is available
on the
PDPM webpage
• One comorbidity Human Immunodeficiency Virus/Acquired Immune Deficiency Syndrome
(HIV/AIDS) is reported on the SNF claim, in the same manner as under RUG-IV:
• The patient’s NTA classification will be adjusted by the appropriate number of points for this condition by the
CMS PRICER for patients with HIV/AIDS
NTA Component: Comorbidity Coding
35
NTA Component: Condition Listing (1)
Condition/Extensive Service Source Points
HIV/AIDS SNF Claim 8
Parenteral Intravenous (IV) Feeding: Level High
MDS Item K0510A2,
K0710A2
7
Special Treatments/Programs: Intravenous Medication Post-admit Code MDS Item O0100H2 5
Special Treatments/Programs: Ventilator or Respirator Post-admit Code MDS Item O0100F2 4
Parenteral IV feeding: Level Low
MDS Item K0510A2,
K0710A2, K0710B2
3
Lung Transplant Status MDS Item I8000 3
Special Treatments/Programs: Transfusion Post-admit Code MDS Item O0100I2 2
Major Organ Transplant Status, Except Lung MDS Item I8000 2
Multiple Sclerosis Code MDS Item I5200 2
Opportunistic Infections MDS Item I8000 2
Asthma Chronic obstructive pulmonary disease (COPD) Chronic Lung Disease
Code
MDS Item I6200 2
Bone/Joint/Muscle Infections/Necrosis - Except Aseptic Necrosis of Bone MDS Item I8000 2
Chronic Myeloid Leukemia MDS Item I8000 2
Wound Infection Code MDS Item I2500 2
Diabetes Mellitus (DM) Code MDS Item I2900 2
36
NTA Component: Condition Listing (2)
Condition/Extensive Service Source Points
Endocarditis MDS Item I8000 1
Immune Disorders MDS Item I8000 1
End-Stage Liver Disease MDS Item I8000 1
Other Foot Skin Problems: Diabetic Foot Ulcer Code MDS Item M1040B 1
Narcolepsy and Cataplexy MDS Item I8000 1
Cystic Fibrosis MDS Item I8000 1
Special Treatments/Programs: Tracheostomy Care Post-admit Code MDS Item O0100E2 1
Multi-Drug Resistant Organism (MDRO) Code MDS Item I1700 1
Special Treatments/Programs: Isolation Post-admit Code MDS Item O0100M2 1
Specified Hereditary Metabolic/Immune Disorders MDS Item I8000 1
Morbid Obesity MDS Item I8000 1
Special Treatments/Programs: Radiation Post-admit Code MDS Item O0100B2 1
Highest Stage of Unhealed Pressure Ulcer - Stage 4 MDS Item M0300D1 1
Psoriatic Arthropathy and Systemic Sclerosis MDS Item I8000 1
Chronic Pancreatitis MDS Item I8000 1
Proliferative Diabetic Retinopathy and Vitreous Hemorrhage MDS Item I8000 1
37
NTA Component: Condition Listing (3)
Condition/Extensive Service Source Points
Other Foot Skin Problems: Foot Infection Code, Other Open Lesion on Foot Code,
Except Diabetic Foot Ulcer Code
MDS Item M1040A,
M1040B, M1040C
1
Complications of Specified Implanted Device or Graft MDS Item I8000 1
Bladder and Bowel Appliances: Intermittent Catheterization MDS Item H0100D 1
Inflammatory Bowel Disease MDS Item I1300 1
Aseptic Necrosis of Bone MDS Item I8000 1
Special Treatments/Programs: Suctioning Post-admit Code MDS Item O0100D2 1
Cardio-Respiratory Failure and Shock MDS Item I8000 1
Myelodysplastic Syndromes and Myelofibrosis MDS Item I8000 1
Systemic Lupus Erythematosus, Other Connective Tissue Disorders, and
Inflammatory Spondylopathies
MDS Item I8000 1
Diabetic Retinopathy - Except Proliferative Diabetic Retinopathy and Vitreous
Hemorrhage
MDS Item I8000 1
Nutritional Approaches While a Resident: Feeding Tube MDS Item K0510B2 1
Severe Skin Burn or Condition MDS Item I8000 1
Intractable Epilepsy MDS Item I8000 1
Malnutrition Code MDS Item I5600 1
38
NTA Component: Condition Listing (4)
Condition/Extensive Service Source Points
Disorders of Immunity - Except : RxCC97: Immune Disorders MDS Item I8000 1
Cirrhosis of Liver MDS Item I8000 1
Bladder and Bowel Appliances: Ostomy MDS Item H0100C 1
Respiratory Arrest MDS Item I8000 1
Pulmonary Fibrosis and Other Chronic Lung Disorders MDS Item I8000 1
40
• The Social Security Act requires the SNF PPS to pay on a per-diem basis
• Constant per diem rates do not accurately track changes in resource utilization throughout the stay
and may allocate too few resources for providers at beginning of stay
• To account more accurately for the variability in patient costs over the course of a stay, under PDPM,
an adjustment factor is applied (for certain components) and changes the per diem rate over the
course of the stay:
• Similar to what exists under the Inpatient Psychiatric Facility PPS
• For the PT, OT, and NTA components, the case-mix adjusted per diem rate is multiplied against the
variable per diem adjustment factor, following a schedule of adjustments for each day of the patient’s
stay
Variable Per Diem Adjustment
41
• PT & OT Components
• NTA Component
Variable Per Diem Adjustment Schedules
Day in Stay Adjustment Factor Day in Stay Adjustment Factor
1-20 1.00 63-69 0.86
21-27 0.98 70-76 0.84
28-34 0.96 77-83 0.82
35-41 0.94 84-90 0.80
42-48 0.92 91-97 0.78
49-55 0.90 98-100 0.76
56-62 0.88
Day in Stay Adjustment Factor
1-3 3.00
4-100 1.00
43
• Consider two patients with the following characteristics:
Patient Classification Example
Patient Characteristics Patient A Patient B
Rehabilitation Received Yes Yes
Therapy Minutes 730 730
Extensive Services No No
ADL Score 9 9
Clinical Category Acute Neurologic Major Joint Replacement
PT & OT Functional Score 10 10
Nursing Function Score 7 7
Cognitive Impairment Moderate Intact
Swallowing Disorder No No
Mechanically Altered Diet Yes No
SLP Comorbidity No No
Comorbidities IV Medication and Diabetes Chronic Pancreatitis
Other Conditions Dialysis Septicemia
Depression No Yes
47
• Patient A is receiving dialysis services with PDPM Nursing Functional Score of 7 and is classified into
LBC1
PDPM Classification: Nursing Component (1)
Extensive
Services?
PDPM Nursing Function Score
0-1 2-5 6-10 11-14 15-16
Extensive Services
Yes
No
Tracheostomy
Conditions requiring
complex medical care
such as pneumonia,
surgical wounds, burns
Serious medical
conditions e.g.
comatose, septicemia,
respiratory therapy
Serious medical
conditions e.g.
radiation therapy or
dialysis
Depression?
No
Yes
No
No
Yes
Yes
ES1
ES2
ES3
HDE2
CA1
CA2
HBC2
Other Conditions
Ventilator/
Respirator
Infection
Isolation
HDE1
HBC1
LDE2
LBC2
LDE1
LBC1
CDE2
CBC2
CDE1
CBC1
48
• Patient B has septicemia and PDPM Nursing Functional Score of 7, exhibits signs of depression, and
is classified into HBC2
PDPM Classification: Nursing Component (2)
Extensive
Services?
PDPM Nursing Function Score
0-1 2-5 6-10 11-14 15-16
Extensive Services
Yes
No
Tracheostomy
Conditions requiring
complex medical care
such as pneumonia,
surgical wounds, burns
Serious medical
conditions e.g.
comatose, septicemia,
respiratory therapy
Serious medical
conditions e.g.
radiation therapy or
dialysis
Depression?
No
Yes
No
No
Yes
Yes
ES1
ES2
ES3
HDE2
CA1
CA2
HBC2
Other Conditions
Ventilator/
Respirator
Infection
Isolation
HDE1
HBC1
LDE2
LBC2
LDE1
LBC1
CDE2
CBC2
CDE1
CBC1
51
• In addition to the case-mix refinements, PDPM also includes policy changes to the SNF PPS to be
effective concurrent with implementation of PDPM
• Areas discussed in the next slides:
• MDS Related Changes:
• MDS Assessment Schedule
• New MDS Item Sets
• New MDS Items
• Concurrent & Group Therapy Limit
• Interrupted Stay Policy
• Administrative Presumption
• Payment for Patients with AIDS
• Revised Health Insurance Prospective Payment System (HIPPS) Coding
• RUG-IV – PDPM Transition
Additional PDPM Policies
53
• Both RUG-IV and PDPM utilize the MDS 3.0 as the basis for patient assessment and classification
• The assessment schedule for RUG-IV includes both scheduled and unscheduled assessments with
a variety of rules governing timing, interaction among assessments, combining assessments, etc.:
• Frequent assessments are necessary, due to the focus of RUG-IV on such highly variable characteristics as
service utilization
• The assessment schedule under PDPM is significantly more streamlined and simple to understand
than the assessment schedule under RUG-IV
• The changes to the assessment schedule under PDPM have no effect on any Omnibus Budget
Reconciliation Act of 1987 (OBRA)-related assessment requirements
MDS Changes: Assessment Schedule
54
RUG-IV Assessment Schedule
Scheduled Assessment
Medicare MDS Assessment
Schedule Type
Assessment
Reference Date
Assessment Reference
Date Grace Days
Applicable Standard Medicare
Payment Days
5-day Days 1-5 6-8 1 through 14
14-day Days 13-14 15-18 15 through 30
30-day Days 27-29 30-33 31 through 60
60-day Days 57-59 60-63 61 through 90
90-day Days 87-89 90-93 91 through 100
Unscheduled Assessment
Start of Therapy Other
Medicare-Required
Assessment (
OMRA)
5-7 days after start of therapy
Date of the first day of therapy through the end of
the standard payment period
End of Therapy OMRA 1-3 days after end of therapy
First non-therapy day through the end of the
standard payment period
Change of Therapy OMRA Day 7 (last day) of
Change of Therapy
(
COT) observation period
The first day of the COT observation period until end
of standard payment period, or until interrupted by
the next COT-OMRA assessment or scheduled or
unscheduled PPS Assessment
Significant Change in Status
Assessment
No later than 14
days after
significant change
identified
Assessment Reference Date (ARD) of
Assessment through the end of the standard
payment period
55
PDPM Assessment Schedule
Medicare MDS Assessment Type Assessment Reference Date
Applicable Standard Medicare
Payment Days
Five-day Scheduled PPS
Assessment
Days 1-8
All covered Part A days until Part A
discharge (unless an IPA is
completed)
Interim Payment Assessment
(IPA)
Optional Assessment
ARD of the assessment through
Part A discharge (unless another IPA
assessment is completed)
PPS Discharge Assessment
PPS Discharge: Equal to the End
Date of the Most Recent Medicare
Stay (A2400C) or End Date
N/A
56
• Interim Payment Assessment (IPA):
• Optional Assessment: May be completed by providers in order to report a change in the patient’s PDPM
classification
• Does not impact the variable per diem schedule
• ARD: Determined by the provider
• Payment Impact: Changes payment beginning on the ARD and continues until the end of the Part A stay or
until another IPA is completed
• Optional State Assessment (OSA):
• Solely to be used by providers to report on Medicaid-covered stays, per requirements set forth by their state
• Allows providers in states using RUG-III or RUG-IV models as the basis for Medicaid payment to do so until
September 30, 2020, at which point CMS support for legacy payment models will end
MDS Changes: New Item Sets
57
• SNF Primary Diagnosis:
• Item I0020B (New Item)
• This item is for providers to report, using an ICD-10-CM code, the patient’s primary SNF diagnosis
• “What is the main reason this person is being admitted to the SNF?”
• Coded when I0020 is coded as any response 1 – 13
• Patient Surgical History:
• Items J2100 – J5000 (New Items)
• These items are used to capture any major surgical procedures that occurred during the inpatient hospital
stay that immediately preceded the SNF admission (i.e., the qualifying hospital stay)
• Similar to the active diagnoses captured in Section I, these Section J items will be in the form of
checkboxes
MDS Changes: New & Revised Items (1)
58
MDS Changes: Patient Surgical Categories
Item Surgical Procedure Category Item Surgical Procedure Category
J2100
Recent Surgery Requiring Active SNF Care J2610
Neuro surgery - peripheral and autonomic nervous system - open
and percutaneous
J2300
Knee Replacement - partial or total J2620
Neuro surgery - insertion or removal of spinal and brain
neurostimulators, electrodes, catheters, and CSF drainage devices
J2310
Hip Replacement - partial or total J2699 Neuro surgery - other
J2320
Ankle Replacement - partial or total J2700
Cardiopulmonary surgery - heart or major blood vessels - open and
percutaneous procedures
J2330
Shoulder Replacement - partial or total J2710
Cardiopulmonary surgery - respiratory system, including lungs,
bronchi, trachea, larynx, or vocal cords - open and endoscopic
J2400
Spinal surgery - spinal cord or major spinal nerves J2799 Cardiopulmonary surgery - other
J2410
Spinal surgery - fusion of spinal bones J2800 Genitourinary surgery - male or female organs
J2420
Spinal surgery - lamina, discs, or facets J2810
Genitourinary surgery - kidneys, ureter, adrenals, and bladder -
open, laparoscopic
J2499
Spinal surgery - other J2899 Genitourinary surgery - other
J2500
Ortho surgery - repair fractures of shoulder or arm J2900 Major surgery - tendons, ligament, or muscles
J2510
Ortho surgery - repair fractures of pelvis, hip, leg, knee, or ankle J2910
Major surgery - GI tract and abdominal contents from esophagus to
anus, biliary tree, gall bladder, liver, pancreas, spleen - open,
laparoscopic
J2520
Ortho surgery - repair but not replace joints J2920
Major surgery - endocrine organs (such as thyroid, parathyroid),
neck, lymph nodes, and thymus - open
J2530
Ortho surgery - repair other bones J2930 Major surgery - breast
J2599
Ortho surgery - other J2940
Major surgery - deep ulcers, internal brachytherapy, bone marrow,
stem cell harvest/transplant
J2600
Neuro surgery - brain, surrounding tissue/blood vessels J5000 Major surgery - other not listed above
59
• Discharge Therapy Collection Items:
• Items 0425A1 – O0425C5 (New Items)
• Using a look-back of the entire PPS stay, providers report, by each discipline and mode of therapy, the
amount of therapy (in minutes) received by the patient
• If the total amount of group/concurrent minutes, combined, comprises more than 25% of the total amount of
therapy for that discipline, a warning message is issued on the final validation report
• Section GG Functional Items – Interim Performance:
• On the IPA, Section GG items will be derived from a new column “5” which will capture the interim
performance of the patient
• The look-back for this new column will be the three-day window leading up to and including the ARD of the
IPA (ARD and the 2 calendar days prior to the ARD)
MDS Changes: New & Revised Items (2)
60
• Existing MDS Items Being Added to Swing Bed Assessment:
• K0100: Swallowing Disorder
• I1300: Ulcerative Colitis or Crohn’s Disease or Inflammatory Bowel Disease
• I4300: Active Diagnosis: Aphasia
• O0100D2: Special Treatments, Procedures & Programs: Suctioning, While a Resident
• Existing Items Being Added to 5-day PPS Assessment and IPA:
• I1300: Ulcerative Colitis or Crohn’s Disease or Inflammatory Bowel Disease
MDS Changes: New & Revised Items (3)
62
• Under RUG-IV, no more than 25% of the therapy services delivered to SNF patients, for each
discipline, may be provided in a group therapy setting, while there is no limit on concurrent therapy
• Definitions:
• Concurrent Therapy: One therapist with two patients doing different activities
• Group Therapy: One therapist with four patients doing the same or similar activities
• Under PDPM, we use a combined limit both concurrent and group therapy to be no more than 25%
of the therapy received by SNF patients, for each therapy discipline
Concurrent & Group Therapy Limits
63
• Compliance with the concurrent/group therapy limit will be monitored by new items on the PPS
Discharge Assessment (O0425):
• Providers will report the number of minutes, per mode and per discipline, for the entirety of the PPS stay
• If the total number of concurrent and group minutes, combined, comprises more than 25% of the total
therapy minutes provided to the patient, for any therapy discipline, then the provider will receive a warning
message on their final validation report
• How to calculate compliance with the concurrent/group therapy limit:
• Step 1: Total Therapy Minutes, by discipline
(O0425X1 + O0425X2 + O0425X3)
• Step 2: Total Concurrent and Group Therapy Minutes, by discipline
(O0425X2 + O0425X3)
• Step 3: C/G Ratio (Step 2 Result / Step 1 Result)
• Step 4: If Step 3 Result is greater than 0.25, then non-compliant
Concurrent & Group Limits: Compliance
64
• Example 1:
• Total PT Individual Minutes (O0425C1): 2,000
• Total PT Concurrent Minutes (O0425C2): 600
• Total PT Group Minutes (O0425C3): 1,000
• Does this comply with the concurrent/group therapy limit?
• Step 1: Total PT Minutes (O0425C1 + O0425C2 + O0425C3): 3,600
• Step 2: Total PT Concurrent and Group Therapy Minutes (O0425C2 + O0425C3): 1,600
• Step 3: C/G Ratio (Step 2 Result / Step 1 Result): 0.44
• Step 4: 0.44 is greater than 0.25, therefore this is non-compliant
Concurrent & Group Limits: Example 1
65
• Example 2:
• Total SLP Individual Minutes (O0425A1): 1,200
• Total SLP Concurrent Minutes (O0425A2): 100
• Total SLP Group Minutes (O0425A3): 200
• Does this comply with the concurrent/group therapy limit?
• Step 1: Total SLP Minutes (O0425A1 + O0425A2 + O0425A3): 1,500
• Step 2: Total SLP Concurrent and Group Therapy Minutes (O0425A2 + O0425A3): 300
• Step 3: C/G Ratio (Step 2 Result / Step 1 Result): 0.20
• Step 4: 0.20 is not greater than 0.25, therefore this is compliant
Concurrent & Group Limits: Example 2
67
• Given the introduction, under PDPM, of the variable per diem adjustment, there is a potential
incentive for providers to discharge SNF patients from a covered Part A stay and then readmit the
patient in order to reset the variable per diem schedule
• Frequent patient readmissions and transfers represents a significant risk to patient care, as well as a
potential administrative burden on providers from having to complete new patient assessments for
each readmission
• To mitigate this potential incentive, PDPM includes an interrupted stay policy, which would combine
multiple SNF stays into a single stay in cases where the patient’s discharge and readmission occurs
within a prescribed window:
• This type of policy also exists in other post-acute care settings (e.g., Inpatient Rehabilitation Facility PPS)
Interrupted Stay Policy: Background
68
• If a patient is discharged from a SNF and readmitted to the same SNF no more than 3 consecutive
calendar days after discharge, then the subsequent stay is considered a continuation of the previous
stay:
• Assessment schedule continues from the point just prior to discharge
• Variable per diem schedule continues from the point just prior to discharge
• If patient is discharged from SNF and readmitted more than 3 consecutive calendar days after
discharge, or admitted to a different SNF, then the subsequent stay is considered a new stay:
• Assessment schedule and variable per diem schedule reset to day 1
• This policy applies not only in instances when a patient physically leaves the facility, but also in
cases when the patient remains in the facility but is discharged from a Medicare Part A-covered stay.
• Example: If a patient in a SNF stay remains in the facility under a Medicaid-covered stay, but
returns to skilled care within the interruption window.
Interrupted Stay Policy
69
• Example 1: Patient A is admitted to SNF on 11/07/19, admitted to hospital on 11/20/19, and returns to
same SNF on 11/25/19:
• New stay
• Assessment Schedule: Reset; stay begins with new 5-day assessment
• Variable Per Diem: Reset: stay begins on Day 1 of VPD Schedule
• Example 2: Patient B is admitted to SNF on 11/07/19, admitted to hospital on 11/20/19, and admitted
to different SNF on 11/22/19:
• New stay
• Assessment Schedule: Reset; stay begins with new 5-day assessment
• Variable Per Diem: Reset; stay begins on Day 1 of VPD Schedule
Interrupted Stay Policy: Examples
70
• Example 3: Patient C is admitted to SNF on 11/07/19, admitted to hospital on 11/20/19, and returns
to same SNF on 11/22/19:
• Continuation of previous stay
• Assessment Schedule: No PPS assessments required, IPA optional
• Variable Per Diem: Continues from Day 14 (Day of Discharge)
• Example 4: Patient D is admitted to SNF on 11/07/19. The patient remains in the facility, but is
discharged from Part A on 11/20/19. The patient returns to a Part A-covered stay on 11/22/19.
• Continuation of previous stay
• Assessment Schedule: No PPS assessments required, IPA optional
• Variable Per Diem: Continues from Day 14 (Day of Part A Discharge)
Interrupted Stay Policy: Examples
72
• The SNF PPS includes an administrative presumption in which a beneficiary who is correctly
assigned one of the designated, more intensive case-mix classifiers on the 5-day PPS assessment is
automatically classified as requiring an SNF level of care through the assessment reference date for
that assessment
• Those beneficiaries not assigned one of the designated classifiers are not automatically classified as
either meeting or not meeting the level of care definition but instead receive an individual
determination using the existing administrative criteria
Administrative Presumption: Background
73
• The following PDPM classifiers are designated under the presumption:
• Those nursing groups encompassed by the Extensive Services, Special Care High, Special Care Low, and
Clinically Complex nursing categories;
• PT & OT groups TA, TB, TC, TD, TE, TF, TG, TJ, TK, TN, and TO;
• SLP groups SC, SE, SF, SH, SI, SJ, SK, and SL; and
• The NTA component’s uppermost (12+) comorbidity group
Administrative Presumption: Classifiers
75
• Under RUG-IV, patients with AIDS receive 128% increase in the per diem rate associated with their
RUG-IV classification
• This add-on was merely a general approximation of the added cost of caring for patients with AIDS,
which was not accurately targeted at the specific rate components that actually account for the
disparity in cost between those patients and others:
• Two primary cost components that drive increased cost for this subpopulation are Nursing and NTA costs
• Under RUG-IV, given most patients are classified into a therapy group and criteria used to classify patients
into therapy groups, increased therapy utilization also increased impact of the AIDS add-on, contrary to
research indicating that AIDS is actually associated with a statistically significant decrease in per diem
therapy costs
RUG-IV Payment for SNF Patients with AIDS
76
• As the PDPM was developed, its rate components were specifically designed to account accurately
and appropriately for the increased cost of AIDS-related care, as determined through our research
• Accordingly, the PDPM addresses costs for this subpopulation in two ways:
• Assigns those patients with AIDS the highest point value (8 points) of any condition or service for purposes
of classification under its NTA component
• 18% add-on to the PDPM Nursing component
• As under the previous RUG-IV model, the presence of an AIDS diagnosis continues to be identified
through the SNF’s entry of ICD-10-CM Code B20 on the SNF claim
PDPM Payment for SNF Patients with AIDS
78
• Based on responses on the MDS, patients are classified into payment groups, which are billed using
a 5-character HIPPS code
• The current RUG-IV HIPPS code follows a prescribed algorithm:
• Character 1-3: RUG Code
• Character 4-5: Assessment Indicator
• In order to accommodate the new payment groups, the PDPM HIPPS algorithm is revised as follows:
• Character 1: PT/OT Payment Group
• Character 2: SLP Payment Group
• Character 3: Nursing Payment Group
• Character 4: NTA Payment Group
• Character 5: Assessment Indicator
PDPM HIPPS Coding
80
• Nursing Payment Group to HIPPS Translation:
PDPM HIPPS Coding Crosswalk: Nursing Component
Nursing
Payment Group
HIPPS Character
Nursing
Payment Group
HIPPS Character
ES3 A CBC2 N
ES2 B CA2 O
ES1 C CBC1 P
HDE2 D CA1 Q
HDE1 E BAB2 R
HBC2 F BAB1 S
HBC1 G PDE2 T
LDE2 H PDE1 U
LDE1 I PBC2 V
LBC2 J PA2 W
LBC1 K PBC1
X
CDE2 L PA1 Y
CDE1 M
82
• Example 1:
• PT/OT Payment Group: TN
• SLP Payment Group: SH
• Nursing Payment Group: CBC2
• NTA Payment Group: NC
• Assessment Type: 5-day PPS Assessment
• HIPPS Code: NHNC1
• Example 2:
• PT/OT Payment Group: TC
• SLP Payment Group: SD
• Nursing Payment Group: PBC1
• NTA Payment Group: NE
• Assessment Type: 5-day PPS Assessment
• HIPPS Code:CDXE1
PDPM HIPPS Coding: Examples
83
• As under RUG-IV, there may be instances in which providers may bill the “default” rate on a SNF
claim (e.g., when an MDS assessment is considered late).
• The default rate refers to the lowest possible per diem rate.
• The default code under PDPM is ZZZZZ, as compared to the default code under RUG-IV of AAA00.
• Billing the default code under PDPM represents the equivalent of billing the following PDPM groups:
• PT Payment Group: TP
• OT Payment Group: TP
• SLP Payment Group: SA
• Nursing Payment Group: PA1
• NTA Payment Group: NF
PDPM HIPPS Coding: Default Billing
85
• As discussed in the FY 2019 SNF PPS Final Rule, there is no transition period between RUG-IV and
PDPM, given that running both systems at the same time would be administratively infeasible for
providers and CMS:
• RUG-IV billing ends September 30, 2019
• PDPM billing begins October 1, 2019
• To receive a PDPM HIPPS code that can be used for billing beginning October 1, 2019, all providers
will be required to complete an IPA with an ARD no later than October 7, 2019 for all SNF Part A
patients:
• October 1, 2019, will be considered Day 1 of the VPD schedule under PDPM, even if the patient began
their stay prior to October 1, 2019
• Any “transitional IPAs” with an ARD after October 7, 2019, will be considered late and relevant penalty for
late assessments would apply
RUG-IV & PDPM Transition
87
• PDPM may have a number of effects on Medicaid programs:
• Upper Payment Limit (UPL) Calculation
• Case-mix Determinations
• UPL represents a limit on certain reimbursements for Medicaid providers:
• Specifically, the UPL is the maximum a given State Medicaid program may pay a type of provider, in the
aggregate, statewide in Medicaid fee-for-service
• State Medicaid programs cannot claim federal matching dollars for provider payments in excess of the
applicable UPL
• While budget neutral in the aggregate, PDPM changes how payment is made for SNF services,
which can have an impact on UPL calculations:
• States will need to evaluate this effect to understand revisions in their UPL calculations
Medicaid Related Issues: UPL
88
• For purposes of Medicaid reimbursement, states utilize a myriad of different payment methodologies
to determine payment for Nursing Facility (NF) patients:
• Some states use a version of the RUG-III or RUG-IV models as the basis for patient classification and
case-mix determinations
• With PDPM implementation, CMS will continue to report RUG-III and RUG-IV HIPPS codes, based
on state requirements, in Item Z0200, through 9/30/2020
• Case-mix states also may rely on PPS assessments to capture changes in patient case-mix,
including scheduled and unscheduled assessments:
• As of October 1, 2019, all scheduled PPS assessments (except the 5-day) and all current unscheduled
PPS assessments will be retired
• To fill this gap in assessments, CMS will introduce the OSA, which may be required by states for NFs to
report changes in patient status, consistent with their case-mix rules
Medicaid Related Issues: Case-mix States
91
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92
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