Yet another glorious summer bites the dust, and fall colors are looming around the corner. Similarly, on October 1, SNFs, and their extended summer fling with RUGs, morph into the uncertainty of the Patient-Driven Payment Model.

The falling temperatures, and the absence of RUGs, will surely make SNFs reach for a warm blanket! Best practices can truly be SNFs’ security blanket as they cozy up to PDPM. Here are some tips.

Admission and the Initial MDS Assessment: 

  • Timeliness: The Initial MDS assessment (to be done between day 1-8) is the prime driver of reimbursement under PDPM. Therefore, accurate and comprehensive documentation of patient characteristics in the Initial MDS assessment is of paramount importance. SNF patients are at their sickest upon discharge from hospitals, as they are being treated for acute illnesses, often requiring expensive medications and extensive nursing care and rehabilitation.

    The initial MDS assessment needs to happen as early as possible to capture the increased acuity and higher utilization of resources upon admission. An initial MDS assessment completed later in the window may not get credit for the higher NTA CMI that is usually afforded to IV infusions, medications, supplies and nursing care, if they are discontinued by that date. The cost of a missed opportunity is especially impactful as the NTA payments for the first three days of SNF stay are multiplied by a factor of three.
  • Accuracy: While timing of the initial MDS assessment is critical, without an accurate capture of patient characteristics, SNF reimbursement will suffer under PDPM. A thorough review of hospital records and outpatient records, performed by a clinical practitioner- who can verify and edit (if necessary) the ICD 10 diagnoses codes for each patient, goes a long way towards ensuring accuracy. Physicians are reimbursed by Medicare for the additional time spent in reviewing this information during the initial visit with a SNF patient, and SNFs should insist on, and facilitate, completion of initial visits at the earliest possible time. If non-physician practitioners spend time reviewing records or verifying orders, the prolonged visits are reimbursed based on medical necessity. Any administrative time spent by medical directors in this process, especially on patients who are not theirs to follow, needs to be factored into their monthly stipend.
  • Relevance: There are many advertised ‘tools’ that scan documents for ICD 10 codes, or ‘group’ codes for efficiency, but they are generally poor substitutes for the much needed human intelligence in deciding which ICD codes and patient characteristics are relevant for each MDS assessment. Of particular import is the process of choosing ICD 10 codes to populate MDS fields based on their impact on case mix for each category. A ‘cheat sheet’, listing the high impact diagnoses for each category, will be very helpful at the outset. Special attention should be given to identifying acute neurological diagnoses, depression, dysphagia, altered diet, and cognitive deficits, as they significantly affect case mix indices under therapy categories.

SNF stay and the Interim Payment Assessment (IPA): 

  • Change of condition: If the patient’s clinical condition changes during the SNF stay, and higher acuity of care, IV infusions, expensive medications, additional nursing care and equipment or more intense therapy services are needed to optimize care, an IPA should be considered. In such scenarios, IPA likely will bring in higher reimbursements, commensurate with the escalation in care provided.

    Since any change in reimbursement will only affect the remainder of the SNF stay, and there is no NTA multiplier, each facility may wish to define a threshold increase in per diem reimbursement to trigger an IPA. A designated clinician (e.g., MDS clinician or Director of Nursing) ought to assume ownership of the PDPM process to continually track changes in patient characteristics and functional status (section GG) to initiate IPAs when the time is right. “Revenue forecasting” is a fancy term- but this key person would be doing just that and whenever appropriate, optimize the revenue stream to befit care delivery by triggering an IPA. Several therapy and pharmacy electronic records have the capability to integrate with the electronic MDS records and trigger alerts when an IPA might be appropriate.
  • Interdisciplinary collaboration: This is perhaps the most overlooked, and yet the most important singular attribute that results in PDPM success for SNFs. Therapy, pharmacy, nursing, administrators, clinical practitioners and the medical director must collaborate closely to achieve anything more than a modicum of success with PDPM. Once the Initial MDS assessment has established a payment schedule for the SNF stay, the reimbursement mechanism under PDPM mimics the DRG system for hospitals, and just as hospitals receive payments based on patients’ clinical conditions, and not for individual tests, medications and services, SNFs also aren’t reimbursed for unnecessary care and services, and therefore need to always be mindful of “medical necessity.”
    “Utilization Review” is not just a hot topic for hospitals from now on. A dollar saved is two dollars earned, and antibiotic stewardship, deprescribing, timely reconciliation of medications and timely discharge to a lower cost of care setting are all extremely important in achieving profitability. Payments under PDPM are frontloaded (with NTA multiplier for days 1-3, and therapy modifiers after 20 days) to encourage such a transition to value based care. It is vital however, that the clinical practitioners initiate the orders to reduce unnecessary utilization. Whether it is deprescribing, stopping IVs and antibiotics, or reducing therapy minutes, the decision needs to be correlated with medical necessity, and signed off by the practitioner promptly, to avoid potential audits and litigation.
  • Data analytics: In addition to revenue forecasting and timing of IPAs using changing patient characteristics, continued success with PDPM requires SNFs to analyze their revenue streams and expenses closely. These analyses should break down revenue and expenses under each reimbursement category, correlated with lengths of stay, to look for discrepancies. Any and all discrepancies should trigger a root cause analysis to help isolate process errors and identify areas for improvement on an ongoing basis.

PDPM will be here, and upon us, in very short order. Establish and implement best practices quickly, and you shall bask in the glow of success under their security blanket. Procrastinate, and you might just be left with a wet blanket. Trust me, they won’t be fun to be around come October!

PDPM will be here, and upon us, in very short order. Establish and implement best practices quickly, and you shall bask in the glow of success under their security blanket. Procrastinate, and you might just be left with a wet blanket. Trust me, they won’t be fun to be around come October!

Rajeev Kumar, MD, CMD, FACP is the CMO at Symbria and Secretary at AMDA.