The federal government announced it would be taking a look at the Medicare reimbursement system for skilled nursing facilities in the wake of higher-than-expected payments over the course of last year, even allowing for the impact of a global pandemic that had a uniquely deleterious effect on SNF operations.
But whatever ends up changing, for operators, the focus should be the same: maintaining the proper documentation for all care provided to patients.
The Centers for Medicare & Medicaid Services (CMS)— in announcing the new proposed final rule for the fiscal 2022 prospective payment system (PPS) — expressed its intention of recalibrating the Patient-Driven Payment Model (PDPM) “as quickly as possible,” estimating that SNFs received an unintended increase in payments of approximately 5%, or $1.7 billion, in FY 2020 in a fact sheet released with the rule.
The agency has proposed some options for how to restore payments under PDPM to the original budget-neutral goal, meaning that CMS would not spend more under PDPM than it had under the Resource Utilization Group – Version Four (RUG-IV) that it replaced. They include giving operators a certain time period to prepare for a blanket cut in the PDPM case mix index, or reducing the index by a smaller amount over a few years.
For Bill Goulding, lead consultant at the post-acute firm PACS Consulting, the fact that the agency is asking the provider community for input is important. But he disagrees with CMS’s argument that PDPM alone, rather than the COVID-19 public health emergency (PHE), is driving some of the changes.
The agency’s argument is that even though it waived the “three-day-stay rule” requiring a hospital stay of three days for a beneficiary to receive Medicare coverage, only a small portion of residents in Part A skipped a hospital stay. It also argued that there was no “huge, overwhelming percentage of positive COVID diagnoses,” Goulding told Skilled Nursing News.
“[E]ven when removing those using a PHE-related waiver and those with a COVID19 diagnosis from our dataset, the observed inadvertent increase in SNF payments since PDPM was implemented is approximately the same,” CMS wrote in the proposed rule. “This would seem to imply that this ‘new’ population of SNF beneficiaries (that is, COVID-19 patients and those using a section 1812(f) waiver) does not appear to be the cause of the increase in SNF payments after implementation of PDPM, since we would expect a much greater impact on the calculation of the necessary recalibration from removing this population from our analysis if that were the case.”
But Goulding argued that what happened, particularly in the early stages of the pandemic, was that SNFs didn’t always have evidence of positive diagnoses of COVID-19, even if they had waves of residents developing symptoms and sometimes even going to the hospital.
Because of the issues with getting a quick diagnosis of COVID-19, a resident with pneumonia symptoms and fever might not be recorded with CMS as a COVID-19 patient — or even be classified as isolated because they did not meet the technical definition of having an active infection that could be identified, Goulding said.
“So they’re classified as ‘special care high’ under this new system,” he told SNN. “We saw an enormous spike not only in isolations, for nursing, but in special care high. If they’re only looking at positive COVID diagnoses and hospitalization rates, they’re missing the significant impact of these very sick residents over this past year.”
Goulding looked at roughly 100,000 Minimum Data Set (MDS) assessments in the PACS database since the beginning of PDPM on October 1, 2019, with two distinct periods: from October 2019 to February 2020, just before the pandemic hit in full force, and April 2020 through March 2021, “the COVID period,” as he put it.
“I look at case mix, as measured by the PDPM system, and I see that PT [physical therapy] and OT [occupational therapy] are dealing with lower case-mix residents, and nursing and speech are dealing with higher case-mix residents,” he said. “There’s a clear change.”
The higher case mix for speech resulted in about $4 more a day, while nursing led to $33 more a day, he said, pointing out that “all changes are not equal.”
He also noted that CMS cited changes in therapy minutes — specifically a drop in the average therapy that patients received from from 91 minutes to about 62 minutes — “well before the onset of the pandemic,” according to the proposed rule.
“One of the reasons they need to make these parity adjustments is because therapy minutes have changed — I just don’t see that as even a valid driver for that decision,” he said. “If they need to make parity adjustments that move towards a budget-neutral system, that’s fine, but I wouldn’t use as the rationale for it: ‘Therapy minutes have have changed.’ They’re not paying for therapy minutes; they’re paying for patient characteristics, at least from a PT and OT standpoint.”
He also argued that even though CMS says it has seen no change in outcomes, the only outcomes the agency refers to are some quality measures, specifically falls and rehospitalizations.
“Therapy has some impact on those measures,” Goulding said. “But not nearly as big an impact as nursing has.”
Reviewing based on utilization
Medicare’s entire method of review is based on utilization, and it will explore providers who have an increase in utilization in specific categories of care, according to John Delossantos, president and CEO of JMD Healthcare Solutions, a SNF management service company based in Carmel, Ind.
“The special care high category is one that’s really spiked, and this comes as a result of people learning how to do the MDS a little bit better,” he said. “When we first started reviewing under PDPM, they missed a lot. A lot of providers missed a lot of things that would have given them bumps in reimbursement, that they have learned — just like anyone learns — the things that do that and focusing on those things … The second category to look at: They’re going to look at speech.”
Speech therapy emerged early as a critical area of focus under PDPM, given how many different aspects of patient care it touches. CMS will be looking to ensure that speech services were directly linked to a doctor’s order, such as for patients with swallowing issues who require a modified diet, Delossantos said.
OT and PT are condition-based and functional-level based, but speech “is kind of its own little entity,” he explained. The swallowing issue and altered diet can be determined by a speech therapist, rightly, since this is their area of expertise, he said. But given the sharp utilization changes, from a lower category at the start of PDPM to a much higher portion of patients showing those two conditions, that will draw attention, he told SNN.
“I feel — this is my opinion — but I feel they are going to start looking for more supportive documentation from the physicians, rather than just signing the therapy certification,” Delossantos said.
Another area SNFs need to think about is the capturing of non-therapy ancillaries. While providers should be getting credit for every service they provide to a patient, NTAs are only for active diagnoses; in other words, they should not be captured every time something that qualifies as an NTA appears in a patient’s chart, Delossantos explained.
SNFs also need to keep in mind that they still have to provide therapy to patients, even though COVID-19 scrambled the conditions under which they normally facilitate those services, he noted. Facilities will have to be sure they had plans for ensuring the standards of care, especially for patients who did not receive therapy.
“Medicare never said you don’t have to take care of them anymore,” Delossantos said. “You have to give them the essential services. So looking at that is going to be a big thing over the next year for reviews — who got therapy, who didn’t — and rather than trying to support the minutes, trying to support maybe lack of minutes.”