New CMS rule to eliminate section of MDS, revise RUGs

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New CMS rule to eliminate section of MDS, revise RUGs
New CMS rule to eliminate section of MDS, revise RUGs

A controversial new rule from the Centers for Medicare & Medicaid rule will recalibrate Medicare case mixes under the Resource Utilization Group (RUG) system. Specifically, it will eliminate a section of the Minimum Data Set (MDS) and change the RUG classification process for short-stay residents.

Effective Oct. 1, 2010, the rule will eliminate section T of the MDS, which helps determine RUG placement.  Section T is used to estimate the amount of therapy a resident will receive during the first 14 days of a stay in a skilled nursing facility. CMS believes that projections have been inaccurate and a large number of residents have not received the amount of therapy they were forecast to receive. Instead, CMS will implement an optional start-of-therapy Other Medicare Required Assessment (OMRA) with an Assessment Reference Date (ARD) to be carried out five to seven days after therapy begins.

CMS will also change the RUG reporting process for short-stay residents. The new classification process "will be based on the average daily minutes of therapy provided," according to the rule.

The rule, which CMS disclosed earlier this summer, has riled providers. Nursing home groups believe it will reduce Medicare payments to facilities by roughly $12 billion to $16 billion over the next 10 years. CMS said the rule will reduce payments to nursing homes by approximately $1.05 billion in FY 2010. But those cuts to Medicare will be offset slightly by a $690 million market-basket adjustment, according to CMS.