Therapy revisions remain a CMS goal

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Elizabeth Newman
Elizabeth Newman

If there's one sentence from this week's Office of Inspector General report that should be pulled out and displayed on your bulletin board, it's this: “We found that Medicare payments for therapy greatly exceeded SNFs' costs for therapy.”

In long-term care, them's fightin' words.

But if it's a complete surprise, you haven't been paying attention. Last month, the Centers for Medicare & Medicaid Services turned an investigation over to recovery audit contractors based on the levels of Ultra-High therapy billing. Earlier this year, one skilled nursing facility false claims case was settled for $125 million.

If CMS and OIG were in a marriage, the title of the recent report is the “Office of Inspector General's 2016 Compendium of Unimplemented Recommendations” is the equivalent of sending your spouse a list of grievances, with an appendix of a “honey-do” list. The report outlines 25 unimplemented recommendations the office says would help cut costs and improve quality among Department of Health & Human Services programs. There's no scenario where these two entities will be able to get divorced, so CMS is continuing to grit its teeth and work through what the OIG wants.

The OIG has many concerns, but its specific issue around therapy is how the daily rate for it is based on the amount of therapy provided, without taking into account specific characteristics of the beneficiary. Pretty consistently, federal officials have said they've found Medicare payments for therapy are exceeded the SNFs' costs for therapy, and that there's too much of a financial incentive to bill at a higher level of therapy. In 2009, the OIG said skilled nursing facilities billed one-quarter of that year's claims in error, resulting in $1.5 billion in inappropriate Medicare payments.

As a reminder, for beneficiaries at a SNF under Medicare Part A, the facility assesses the resident to classify him or her into a resource utilization group. That RUG level determines how much Medicare pays the SNF each day. There are five levels of RUGs, and payment rates for therapy RUGs are generally higher than in non-therapy. In one example, the OIG found the average daily payment rate for Ultra-High therapy was $620 in fiscal year 2013, while the average rate for Low-Therapy was $362. If you were looking at a 30-day stay where one person was reclassified in this way, that's more than $7,000 difference.

To be fair to providers, long-term care facilities are seeing increasingly complex patients, and  some of the decisions around who is best served by additional therapy is tough. For those at fault, some of this becomes complicated for who is actually wrong — if anyone — for high levels of billed therapy. SNFs may be contracting out their therapy, and there's often a fair amount of pressure on rehab centers, therapists and aides to provide higher levels of therapy. It can be challenging to do what you believe is ethical when you'd also like to keep your job. I am tremendously sympathetic to clinicians stuck on a hamster wheel of paperwork in attempts to help a Medicare beneficiary grow stronger through therapy, and eventually go home. I am less sympathetic to those pushing therapy under the guise of “what can it hurt?” when the truth is that the only people it's helping are well-paid executives.

Ultimately, as with so many things, it doesn't matter what I think, or even what the truth is, but rather what to infer will happen next. In this marriage, the partners are united in agreeing that the method of paying for therapy should change, and CMS is doing a project to study and evaluate SNF therapy payment options. For providers, if they didn't know already, the day is coming where a facility cannot be kept afloat through a lot of therapy alone.

Elizabeth Newman is Senior Editor of McKnight's. Follow her @TigerELN.


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Daily Editors' Notes

McKnight's Daily Editors' Notes features commentary on the latest in long-term care news and issues. Entries are written by Editorial Director John O'Connor, Editor James M. Berklan, Senior Editor Elizabeth Newman and Staff Writer Marty Stempniak.