On July 31, 2018, the Centers for Medicare and Medicaid Services (CMS) finalized a plan to replace the Skilled Nursing Facility’s (SNF) Resource Utilization Groups (RUGs) payment system with a new model for Medicare Part A payment, to be effective October 1, 2019. While the model is similar to the one proposed in April 2018, CMS made some refinements. The new payment methodology will be called the Patient-Driven Payment Model (PDPM). This new payment model will create both opportunities and challenges for SNF providers and SNF therapists, including more focus on Minimum Data Set (MDS) coding, specifically ICD-10 and Section GG coding. Additionally, managing length of stay and managing the amount and type of therapy delivered will be important strategies for providers. Understanding the new system will be critical to future success.
Ellen R. Strunk, PT, MS, GCS, CEEAA, CHC, has worked in various roles and settings as both a clinician and manager/director: hospital, transitional care, Director of Rehab for a hospital home health agency, Clinical Consultant, Director of a HH staffing division, and Director of Governmental Affairs for a company providing rehab services in long-term care, home health, and outpatient settings. Presently, Ellen is the owner of Rehab Resources & Consulting, Inc., a company providing continuing education and consulting services for post-acute care settings. For the past seven years, she has specialized in helping clients understand and navigate the CMS regulations for post-acute care settings, as well as how to prepare for the transition to a value-based system. Ellen is passionate about delivering medically necessary therapy services in these settings and lectures nationally on the topics of pharmacology for rehabilitation professionals, exercise and wellness for older adults, the importance of functional outcomes, and coding/billing/documentation for therapy services. Ellen is a member of the American Physical Therapy Association, where she has served on a Payment Policy Strategy Committee advising the APTA Board of Directors on payment policy in all settings. She is a member of the APTA Section on Geriatrics, the APTA Home Health Section, and the APTA Health Policy & Administration Sections. She serves on a state level as the President of the Alabama Physical Therapy Association and as its Practice & Reimbursement Chair. She is a member of the American Health Care Association, where over the last three years she has been a part of a therapy workgroup to develop a national quality measure for rehabilitation.
The Patient Driven Payment Model (PDPM) is the SNF Payment System that correlates payment to the patients’ conditions and care needs rather than volume of services (Cost-Based) provided or resources rendered (PPS RUGs System). This chapter will describe the basis for changing the system and the essential components that calculate the new PDPM.
The first step in determining the patient’s per diem in the new Patient Driven Payment Model (PDPM) is to classify patients by clinical category. This chapter will define those categories, as well as how the patient is classified into one or another.
While the role of function has always been an important part of determining the appropriate frequency and intensity of services to be delivered, the Patient Driven Payment Model (PDPM) elevates its importance by linking it directly to the case-mix index. As a result, it will become an important part of determining how much a skilled nursing provider is paid.
Tapering of therapy services as a preparatory step to discharge planning is not a new concept. What is new is that the Patient Driven Payment Model (PDPM) incorporates this concept into the payment model beginning on Day 21 of a patient’s stay. This chapter will explain how the calculation will work and why it is being used.
The Centers for Medicare and Medicaid Services (CMS) has openly discussed how the Patient Driven Payment Model (PDPM) will provide patients an opportunity “to choose a skilled nursing facility that offers services tailored to their condition and preferences”. This chapter will explore how the PDPM will do this. The role of quality and value will also be discussed, and the important part the interdisciplinary team, including PT, OT, SLPs, Nursing, Activities, Restorative and Dietary professionals have in their facilities.