‘Triple Whammy’ of Regulatory Changes Leave Little Breathing Room as MDS Changes Arrive at SNFs

Ahead of the upcoming Minimum Data Set (MDS) changes on Oct. 1, the preparation of clinicians is mixed and may have a lot to do with company size and regional market, along with resources to stay apprised of reimbursement updates.

Many clinicians feel stressed and overwhelmed by the adjustments, with some playing catchup to the changes – some of the frustration being related to staffing shortages and not enough time – although many also generally feel prepared.

Shawna Rainey, vice president of clinical reimbursement with Ignite Medical Resorts, said her team has been feeling overwhelmed, as clinicians continued to revisit some of the new processes toward the end of September.


“From a 500-foot view, I think we’re feeling optimistic, we’re feeling good, feeling prepared but still trying to wrap our heads around our checks and balances,” said Rainey.

Rainey said that she will be spending the next several weeks into the end of October gauging how the team is adjusting to the changes, with a special focus on the accuracy of Section GG, which is used to evaluate a resident’s self care and mobility, and the PHQ 2 and 9, which is used to screen or diagnose depression, as well as operationalizing some of these auditing tools, she said.

Another concern on the horizon for operators is how states will handle MDS changes, if they haven’t already.


Vincent Fedele, partner and director of analytics at Zimmet Healthcare Services Group, said states have three options. States can convert to the Patient Driven Payment Model (PDPM), or move to an optional state assessment (OSA) and “kick the can down the road” until 2024 or 2025. Or, states can simply freeze their case mix, freeze their rates and not move to PDPM until next year.

The Centers for Medicare & Medicaid Services (CMS) is allowing states to have Section G and GG running at the same time, in what the agency calls the OSA. It’s designated as a supplement. It is, however, a source of consternation.

“That is essentially dual system management,” Fedele said of the OSA option. States like Illinois are opting for a phased-in approach, he said, but that still exacerbates a level of complexity, with the provider managing case mix in two systems, resource utilization groups (RUGs) and PDPM.

To incorporate these changes, there isn’t much “breathing room” either, Rainey noted, with staff needing to immediately shift focus from MDS to managing quality measures and the Five-Star Rating System.

While October usually brings a multitude of regulatory changes for the industry, Rainey said it seems this year is a “triple whammy” with new quality measures and updates to Five-Star. Health care associations at the local and federal level have been good at keeping operators informed throughout the process though, through memos and updated FAQs in the past year, Rainey added.

“We’re ready … most of the industry is ready,” Prestige Healthcare Management’s senior VP of Quality and Innovation, Lorie Morris, said of her team. “We have talked to other companies. I would think that everybody would be ready because we’ve had time, but I was surprised that some are just not on top of it at all. I’m not sure what will happen there.”

A range of preparedness

The different levels of preparedness across the sector might come down to the size of the provider, Morris said. Not all companies have dedicated staff overseeing resident assessment instruments (RAIs) and those are the very companies playing catchup right now, Morris said, especially single-owner buildings.

“The story’s not written fully yet,” Morris said of MDS changes and the full impact it will have after Oct. 1, especially on state Medicaid reimbursement. “It would really be nice if [CMS] put something in place, if they had the whole book written before we had to start working on chapter one.”

Aside from changes with activities of daily living and Section G, Morris said the team at Prestige adjusted to smaller MDS updates as they came, including clarity on social determinants of health and Section N with drug diagnosis.

Similarly, Massachusetts-based EF Senior Care has been working internally to support assessment question modifications for Section GG and getting input from interdisciplinary teams while working on data collection tools including its own app, EF Ally.

“Every October with my line of business … We anticipate a whole bucket of changes. That’s the way it’s been for over 20, 25 years. You can set your watch to it, and it happens. So we planned for it,” said Danielle Dang, vice president of clinical reimbursement for EF.

PointClickCare, Morris said, added tools themselves that Prestige staff will use to make the change easier on everyone.

Zimmet also launched CMI-Connect just in time for Oct. 1, which helps providers monitor case mix regardless of what system, RUGs or PDPM, or state they’re in, Fedele said.

“The system calculates the Medicaid case mix using the assessment completion information to tell you what your CMI is in PDPM or RUGs, depending on what system the provider uses, and the ability to toggle between the two, in the states that are transitioning,” he said.

The app compares Medicaid performance across states for reimbursement managers and pulls reimbursement codes and pertinent documentation, he noted.

“I’m sure other software providers did that also, like adding the social determinants of health [to the software] so we’re ready to go,” said Morris. Prestige also made changes to their neuro documentation system and interoperability components.

“You get to the end, and you can feel the weight coming off – finally we’re here,” added Morris. “All of the state associations have been definitely doing a lot of training on it, the professional associations have updated their training to include it. I think we’re ready.”

States vary in MDS approach

Questions surrounding how MDS changes will affect Medicaid reimbursement continue to cause confusion, Morris said, with the shift from Section G to Section GG being the main concern.

Morris said state updates will add another “confusion component” to the mix for providers, depending on what state they operate in, despite finally getting comfortable with PDPM coding.

This section is used to measure the functional status of residents, from the nursing home MDS. The move to replace it with a similar Section GG has states scrambling to figure out how to best implement the change.

“Some states are choosing to freeze [quality points] in place for a period of time, so in terms of quality points you kind of stay there until we cross this divide,” said Morris. Some states use the quality measures as part of their Medicaid rank,” she said. Some of those quality measures won’t be measurable for a while with Section G being removed.

Section GG pulls rehabilitation services into a separate case mix component, while RUGs incorporated it into the case mix with the rest of the clinical conditions.

Prestige will have to do the OSA for some of its facilities.

All the states in which Ignite has facilities have elected not to use the OSA, added Rainey. But, states that don’t require the OSA like Missouri, where it does have facilities, have also indicated that they plan to transition to PDPM. And with no additional information as to the specific components, confusion for operators persists.

“Are they just going to use the nursing case mix group? Is there going to be the non-therapy ancillary addition? We’re trying to navigate that so that the assessments we’re doing now make sense when they’re ready to rebase and recalculate CMI,” said Rainey.

Ignite has a “pretty good idea” the focus in this case will be on the nursing component, she added.

And as for states like Massachusetts, the transition to PDPM was initially “scary for many,” Dang said, but now the new assessments should be familiar since they’re used for a new Medicare admission. Streamlining in this way is “one of the greatest gifts the state could have given us,” she added.

However, there may be bumps along the road when it comes to how MDS changes will affect other care providers in EF’s network, she said, including the Senior Council on Aging that does level of care assessments.

“They’re entirely focused around Section G that’s now retiring. They’re working to come up with a plan to update their system,” said Dang. “The hospice agencies have the same issue, and the VA network – they haven’t come up with a plan yet. They’re asking for paper copies going forward because CMS isn’t supporting [Section G] any longer. And Massachusetts doesn’t have an OSA so we’re going to continue to follow the CMS assessments.”

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