BST, LVN, RAC-CT, ICP, PA-WCC
The long-term care facilities have emerged not only as a permanent home for the elderly during their retirement or post-retirement years but as respite and recuperative facilities even for the younger patients.
It is for this type of services they offer which also categorize them as skilled nursing and rehabilitation facilities becoming a step-down facility from an acute hospital stay.
To further understand the difference between long-term care facilities and skilled nursing/rehabilitation facilities, we will focus on the services they offer.
A long-term care facility provides custodial care requiring supervised, minimal or total dependence in the performance of the activities of daily living (ADLs) such has bed mobility, transfers in and out of bed, walking in the room, walking in the corridor, locomotion on unit peripheral to the patient’s room, locomotion off unit which involves areas farther from the patient’s room such as dining areas, rehabilitation rooms, activity rooms and other administrative offices, toileting, eating, personal hygiene and bathing.
Custodial care does not require the assistance of a licensed staff. They are assisted by certified nursing assistants (CNAs) and licensed staff assist them during medication administration ordered by the patient’s attending physician in the facility. Other ancillary services include room and board, activity planning, housekeeping, laundry, and maintenance of fixtures/equipment.
Reimbursement for these services is covered under the State of California’s Medi-Cal program or privately paid by the patient if he/she does not qualify under the Medi-Cal program.
Skilled nursing services are covered under the Federal Government’s Medicare program for a limited time or on a short-time basis and must meet the following requirements:
The role of the Minimum Data Set (MDS) nurses has evolved all these years from being a clinician to a financial analytical nurse because the MDS assessments have become the basis for facility reimbursement by the Medicare program.
With the transition from Resource Utilization Group Version IV (RUG-IV) to the Patient-Driven Payment Model (PDPM) on October 1, 2019, the MDS nurse requires an analytical mind and financial knowledge to determine the highest allowable reimbursement for the facility.
Prior to October 1, 2019, all SNFs which participate under the Medicare program are paid under the Skilled Nursing Facility (SNF) Prospective Payment System (PPS) based primarily on the type and intensity of therapy services provided to the patients regardless of their acuity, unique characteristics, specific needs, or goals. The RUG-IV consists of two case-mix adjusted components: Therapy which is based on volume of services provided and nursing.
Classifications from the RUG-IV assign patients to payment classification groups, called RUGs, within the payment components: Rehabilitation Plus Extensive Services, Rehabilitation, Extensive Services, Special Care High, Special Care Low, Clinically Complex, Behavioral Symptoms and Cognitive Performance Problems and Reduced Physical Function.
The Patient-Driven Payment Model focuses on the patient’s unique characteristics and needs based on diagnosis which arise during inpatient hospital stay. The calculation of payments is based on the five case-mix adjusted components: Physical Therapy (PT), Occupational Therapy (OT), Speech Language Pathology (SLP), Nursing and Non-therapy ancillary (NTA).
| RUG-IV | PDPM |
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Patient classification system where patients are grouped according to their care and resource needs. |
Focuses on clinically relevant factors rather than volume-based services or RUG levels. |
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Determinant for payment is based on the number of therapy minutes provided regardless of resident’s acuity, diagnosis and other skilled nursing services provided. |
Determinants of payment are based on the patient’s characteristics assigned to six components:
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Patients are assigned to classification groups known as RUG Classification Groups based on various characteristics of patients and the intensity of therapy services provided. |
Patients are assigned a clinical category based on the primary diagnosis for SNF stay. The International Code for Diseases, Tenth Revision, Clinical Modification Codes which popularly known as the ICD-10 CM which is coded on Section I0020B of the MDS assessment is mapped to a clinical category which will be part of the determinant of payment for the PDPM components.
The PDPM Clinical Categories are discussed below. |
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RUG Classification Groups based on the volume and intensity of therapy provided to patient:
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Determinants of Payment for PDPM are summarized below.
The PDPM Rate is derived from the sum of all the PDPM component rates:
PT base rate x PT case mix index (CMI) x VPD adjustment factor Plus OT base rate x OT CMI x VPD adjustment factor Plus SLP base rate x SLP CMI Plus NTA base rate x NTA CMI x VPD adjustment factor Plus Nursing base rate x Nursing CMI x 18% Nursing adjustment factor (only for AIDS patients) Plus Non-case- mix base rate |
When RUG classification was used as the basis of reimbursement, all patients with different patient characteristics were classified in the same RUG level based on the volume and intensity of therapy services provided.
With PDPM payment method, the determinants of payment are categorized into the following case-mix adjusted components:
The PDPM rate is adjusted over the course of facility stay by the inclusion of a variable per diem (VPD) adjustment on the following three components: PT, OT and NTA.
18% of the Nursing adjustment factor is multiplied to the Nursing rate only patients with diagnosis of AIDS. Each component has its case mix index to determine the component rate.
The Centers for Medicare and Medicaid Services (CMS) have provided the SNFs with a list of ICD-10-CM codes mapping to one of the clinical categories:
These clinical categories are used as the Primary PDPM diagnosis giving weight to the calculation of PDPM rates for PT, OT, SLP and Nursing components. Other diagnoses will affect the Non-therapy Ancillary (NTA) component.
The patient’s functional score which is coded on Section GG of the MDS form is derived by assessing the patient’s usual self-performance in the ADL task areas during the first three days of facility stay.
The functional scoring is based on resident’s performance in eating, oral hygiene, toileting hygiene, sit to lying, lying to sitting on side of bed, sit to stand, chair/bed-to-chair transfer, and toilet transfer assessed on the first three days of admission to the facility with the admission day counted as day 1. Functional scoring is one of the factors used to calculate the PDPM rate for the PT, OT and Nursing components.
Below is a summary of the determinants of payment and which section on the MDS assessment form they are derived from.
| Physical Therapy | Occupational Therapy | Speech Therapy | Nursing | Non-therapy Ancillary |
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Primary reason for SNF care or PDPM diagnosis coded on Section I00200B (ICD-10 code) of the MDS assessment and Functional status coded on Section GG of the MDS assessment
Variable per diem adjustment rate |
Primary reason for SNF care or PDPM diagnosis coded on Section I00200B (ICD-10 code) of the MDS assessment and Functional status coded on Section GG of the MDS assessment
Variable per diem adjustment rate |
Primary reason for SNF care or PDPM diagnosis coded on Section I00200B (ICD-10 code) of the MDS assessment and Cognitive Status: BIMS score coded on the Section C of the MDS assessment and presence of a swallowing disorder or mechanically altered diet coded on Section K of the MDS assessment and other SLP-related comorbidities coded on Section I of the MDS assessment |
Clinical information from SNF stay and Functional status coded on Section GG of the MDS assessment and Extensive services received coded on Section of the MDS assessment such as Tracheostomy, Ventilator, and Isolation and Presence of Depression coded on Section D: PHQ9 on the MDS assessment and Restorative nursing services coded on Section O of the MDS assessment |
Comorbidities present coded on Section I of the MDS assessment and Extensive services received coded on Section O of the MDS assessment: Tracheostomy, Ventilator and Isolation
Variable per diem adjustment rate |
The choice of PDPM diagnosis has become rocket science for MDS nurses as this gives more weight in the calculation of the PDPM rate for the facility. Each patient has a different reimbursement rate as compared to the RUG-IV PPS rate in the past. It is highly recommended for the MDS nurse to make calculations which can determine the highest acceptable reimbursement rate for the facility.
The MDS software programs such as PointClick Care, Matrix, Net Solutions, to name just a few, automatically calculate the PDPM rates once the MDS assessment is completed. It is highly advisable for MDS nurses to review each assessment to ensure that all skilled services are captured during the assessment period to maximize reimbursement rate for the facility based on the patient’s diagnosis and acuity.
For the Non-Therapy Ancillary Component, each diagnosis has a corresponding score which is multiplied to the federal NTA case mix index. The higher the score, the higher the NTA rate.
All PDPM components are assigned an appropriate score to multiply to the federally assigned case mix index group. After the PDPM rate for each component is determined, the sum of the PDPM component rates is added to the fixed non-case mix rate which will be the final reimbursement rate for the patient for the entire skilled nursing facility stay.
This can be revised if there is a change in a patient’s condition which requires additional skilled services such as IV medications which were not administered initially.
For situations like this, the MDS nurse will choose to complete an Interim Payment Assessment (IPA) to capture such changes and eventually increase the daily reimbursement rate. The MDS nurse should be alert to these changes to ensure timely completion of the required MDS assessment.
To assist in ensuring that you can capture all diagnoses and pertinent information to maximize facility reimbursement, I suggest doing the following (which most MDS nurses I am sure are already doing):
Request for Hospital History & Physical, Progress Notes, and consults.
Request for labs, imaging studies and surgical reports whichever is applicable.
Formulate a PDPM group to review the chart and come up with the resident’s primary or principal diagnosis and do the ICD-10 clinical category mapping. Medical records department should already code and map for the clinical category to be able to determine principal diagnosis code and calculate expected daily rate for the facility using either the manual PDPM worksheet or software-generated calculation.
Rehab and Nursing staff should complete the Section GG on the MDS form for indicated ADL tasks on Day 1-3 of admission with the admission date as Day 1.
Re-calculate expected daily rate based on the completed Rehab and Nursing Functional Scores and re-review principal diagnosis.
ENSURE TO CAPTURE EVERYTHING PRIOR TO COMPLETION OF THE 5-DAY MDS ASSESSMENT!
(Nursing, Social Services, Dietary and Activity Staff)
All disciplines should complete all their assessments ON TIME to CAPTURE all skilled services and accurately calculate resident’s daily rate PRIOR TO completion and transmission of the MDS 5-day assessment.
Daily Medicare charting should focus on all possible nursing clinical categories, special care high, special care low, clinically complex, behavioral symptoms and cognitive performance, and reduced physical function.
Conduct interview assessments for the Brief Interview for Mental Status (BIMS), and Mood ON ASSESSMENT REFERENCE DATE (ARD) OR A DAY PRIOR TO ARD.
Complete Section K ON ARD or a DAY PRIOR TO ARD indicating if resident has a swallowing disorder especially if on a mechanically altered diet (Puree or mechanical soft diet). Coding of these areas will affect the Speech Case Mix Index.
Continuous training is the key and implementation of what was learned in coordination with the facility team members will ensure success in providing skilled care for the patients and maximizing facility reimbursement.
Always be on the lookout for new updates which usually happen every year and usually effective by October 1 of each updated year. This gives you enough time to prepare for their implementation of any changes as MDS assessments are time sensitive.
Seek advice from experts, trainers and other MDS nurses when needed to clarify any areas in the MDS assessment or PDPM calculation. You are never alone in this field and resources are available in seminars, webinars, the CMS website, MDS manual, etc.
The saying, “haste makes waste” applies in the completion of MDS assessments and calculation of the maximized PDPM rate for the patient. At first, it took me longer to get used to making calculations in determining the highest allowable rate for the patient.
I believe that this payment method acknowledges not only the skilled rehabilitation services provided to the patient, but also the complexity of skilled nursing services rendered to the patient and appropriately incorporated in the PDPM rate calculation.
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