Despite Speech Push, Physical and Occupational Therapy Have Key Role Under PDPM

Speech therapy has taken center stage in discussions about the new Medicare payment system for skilled nursing facilities, but therapists and operators say providers can’t ignore physical and occupational therapy services as they adapt.

In the months after the Centers for Medicare & Medicaid Services (CMS) announced the new Patient-Driven Payment Model (PDPM), speech therapy quickly became the belle of the ball for one vital reason: consistent reimbursements. Under PDPM, providers will see a 2% reduction in payments for PT and OT starting on day 21, with further 2% cuts every seven days thereafter. The reimbursements for speech services, however, will not decline after the 20th day of a resident’s SNF stay.

“CMS has determined that they believe the need decreases, and so there should be a lower payment,” Josh Pickus, CEO of therapy software provider Optima Healthcare Solutions, told SNN back in November. “They have not done that with speech. With speech, you get a consistent rate throughout the period, and so at some level, speech is even more attractive.”


But therapy professionals also noted that the reduction in payment starting on day 21 isn’t necessarily harsh enough to force major changes in provider behavior — and that capturing those effective PT and OT hours remains important for both reimbursements and resident outcomes.

“Really, if you look over the course of time, it is a minimal impact overall to revenue,” Michelle Jabczynski, director of compliance and strategy at Infinity Rehab, said.

With average length of stays around 25 days, there simply aren’t that many days that providers will have to deal with the lower reimbursements, according to JoLynn Munro, division president at the Wilsonville, Ore.-based Infinity. That said, Munro, Jabczynski, and the team realized that there’s still a strong incentive to prove their worth to partners who may look at that number and see cash-flow headaches.


“What we’ve done to position ourselves is really look at how to deliver care that’s efficient — measuring that efficiency of care delivery over time, or by labor hour, to really demonstrate the value of therapy,” Munro said.

For Infinity, a subsidiary of senior housing and care provider Avamere Family of Companies, that has meant developing dedicated physical and occupational care pathways for specific resident conditions, which individual therapists can then tailor to each person’s needs.

“The way I look at PDPM: That’s just another flavor of value-based purchasing, in that it’s going to present an opportunity for physical therapists to really individualize the care they’re providing within these pathways,” Avamere executive vice president Mike Billings said.

As the name of the program implies, CMS designed PDPM with the explicit goal of personalizing nursing home residents’ care. Under the current Resource Utilization Group, Version IV (RUG-IV) system, Medicare pays for therapy service on a per-hour basis, a model that the government claims has encouraged fraud by directly incentivizing the provision of as many therapy hours as possible. While the industry has pushed back on that version of events, multiple providers have had to pay out major settlements to the Department of Justice for False Claims Act violations stemming from improper therapy services, and there’s a general sense that PDPM will put such issues in the past.

PDPM hypothetically rectifies the issue by linking reimbursement amounts with the complexity of resident needs, which marks a likely stepping stone to a system that pays providers based on outcomes. But Billie Nutter, president of rehab-focused electronic medical record (EMR) provider Casamba, emphasized that operators still must make the same case for skilled care as they did under the old system, and the best therapists should start with a clear plan.

“The therapy intensity, the frequency and intensity, has to align with the goals. None of these things change with PDPM,” Nutter, who also served as president and CEO of Brighton Therapy and Rehabilitation, said. “It’s just that PDPM brings about a lack of structured volume of care. It doesn’t tell therapists how much care they need to provide to get reimbursed, so they have to figure that out on their own. And that needs to be driven by the plan of care.”

That’s where developing solid care models, or pathways, comes in. By providing an overall framework of care, complete with occasional checkpoints to determine whether or not the therapists are following the plan, pathways can streamline care provision under PDPM, according to Blue Sky Therapy chief quality and operations officer Lisa Chambers.

“For 20 years, somebody’s been telling them how many minutes to get with a patient,” Chambers said. “And now it’s really not minute-driven anymore, but you have to make sure that your plan of care is appropriate.”

The added flexibility could be both freeing and challenging for providers as they sort out their PDPM strategies before implementation on October 1, when CMS will formally switch from the old RUG model. For instance, providers currently need a specific number of days in each type of therapy discipline in order to get into the higher-reimbursing RUG categories — a problem that won’t occur under PDPM.

But adaptability comes with more responsibility for nursing, therapy, and other staff members, who must work together to accurately create a plan up front that addresses needs and executes the care accordingly. Providers must assess resident function and cognitive impairments, Nutter noted, while also cutting the risks of falls and hospitalizations — goals that therapists have always had under RUG.

“All of those things are still play. They’re still really important, and things we have to work together as a team — both therapy and nursing and all the caregiver,” she said.

And aside from patient outcomes, operators have another reason to monitor their care plans and therapy provisions closely. While CMS has positioned PDPM as a revenue-neutral program, officials will be watching providers closely, and will likely swoop in with rate cuts or penalties if care doesn’t match resident need.

“It’s clear to me and others in the industry that CMS has stated its intent to monitor provider behavior after the implementation of PDPM,” Nutter said. “And they’re going to be looking for any changes in care delivery that may not be supported on the MDS and in the medical record.”

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