Once the new Medicare payment model takes effect, frontline nurses may prove vital to securing the proper reimbursements for skilled nursing services.
The Patient-Driven Payment Model (PDPM) will place increasing pressure on nursing facilities to justify each resident’s need for Medicare-reimbursed skilled care, Zimmet Healthcare Services Group president Marc Zimmet said during a recent industry event — a task that will likely fall to a building’s nursing staff.
“The pressure in this system really falls to the nurses: a lot of the responsibilities and the pressures of maintaining strong documentation that supports skilled care,” Zimmet said at the eCap Healthcare Summit outside of Miami last month.
Under PDPM, set to take effect October 1, therapy minutes will no longer drive Medicare reimbursements; instead, providers will be paid based on each individual’s specific needs, with generally higher payments for more complex services. The change will bring a newfound emphasis on accurately assessing a patient’s conditions, as mistakes on a resident’s initial assessment could lead to lost dollars in addition to improper care.
But while the industry has focused on a variety of specific solutions to the new PDPM reimbursement problems — including the importance of ICD-10 coding and the documentation of certain higher-reimbursing patient categories — Zimmet emphasized that simply justifying the need for institutional skilled care should take center stage.
“We don’t need those minutes. We don’t need those thresholds,” Zimmet said, referencing the incentives of the old Resource Utilization Group (RUG) system. “But what we do need are reasons for a resident, a patient, to qualify for skilled nursing on an inpatient basis. Plenty of people get therapy at home. Why does the patient require skilled care on an inpatient basis?”
The Centers for Medicare & Medicaid Services (CMS) has long pushed to ensure that seniors receive care in the lowest-cost setting that can accommodate their needs, with a host of initiatives designed to empower home health agencies to perform increasingly more complex services at beneficiaries’ homes. SNFs represent a cheaper option than hospitals, but still result in a substantially higher spend for the government than home health — and with cost reductions a stated goal of PDPM, the pressure will only increase.
Zimmet pointed to Chapter 8 of the Medicare Benefit Policy Manual, a 56-page document that spells out the eligibility rules for inpatient nursing home care under Medicare. Before the advent of the Prospective Payment System (PPS) in the late 1990s, Zimmet said, nursing home staffs needed to be fluent in those rules to ensure proper payments, a skill that has dropped off in the years since as therapists increasingly took over reimbursement matters.
He recommended that SNF operators and owners ask their nursing leaders to produce a copy of the Benefit Policy Manual in the lead-up to the introduction of PDPM.
“If it takes them more than 30 seconds, and it’s not highlighted, and it’s not cross-checked, you’re going to have some problems,” Zimmet said.
To highlight the stakes, Zimmet shared an analysis of projected nursing home winners and losers under PDPM, which showed that about 59% of the 13,769 studied SNFs would see payment increases — against around 41%, or more than 5,600 individual buildings, with coming losses. The biggest winners, he noted, were rural swing-bed hospitals in the state of California, while the worst loser was a large for-profit in New York City that would see $5.35 million in annual Medicare losses.
But managing the transition from RUG to PDPM isn’t as simple as zeroing on one factor or billing code. Different components of the PDPM calculation have varied impacts on the overall reimbursement rates, Zimmet noted, and slight changes could have an outsized impact. For instance, he pointed to a scenario in which a therapy company’s focus on Section GG scoring brought an additional $16 in physical and occupational therapy reimbursements — while also decreasing the nursing rate by $30 per day.
He also joined the chorus of industry watchers who note that while knowledge of ICD-10 coding will help providers under PDPM, it’s not a vital cure-all.
“You’ve got to try very hard to screw up this rate,” Zimmet said. “This message is not being put out there. Coding is important, but don’t go crazy with experts. You don’t need to. Why? The money’s not here.”