Since implementation of the Patient Driven Payment Model (PDPM), the Centers for Medicare and Medicaid Services (CMS) has reported that the model is not budget neutral as they had originally planned. Clinicians are not surprised, however, because the PDPM took into consideration patient comorbidities, the nursing components of care delivery, as well as non-therapy ancillary needs. 

In June of 2023, CMS added yet another 5-Claim Probe for all skilled nursing facilities to the current pre-payment and post-payment reviews, with the intent to identify potential billing errors and provide facilities education. As with all denials, auditors are reviewing medical records to ensure the record supports two critical areas—medical necessity and the Health Insurance Prospective Payment System (HIPPS) code billed.

1.  Medical Necessity

The term “medical necessity” is not clearly defined. A patient admitted to a skilled nursing facility must meet all four skilled service criteria, and the “inherent complexity of a service prescribed for a patient is such that it can be performed safely and/or effectively by or under the general supervision of skilled nursing or skilled rehabilitation personnel.” Therefore, reviewers can be very subjective in determining whether medical necessity has been met.

2.  HIPPS Code

The HIPPS modifier does not have to be as subjective if facilities are doing their due diligence from the time the patient admits on Medicare Part A (or certain managed plans) until billing occurs. Two obscure paragraphs in the Resident Assessment Instrument (RAI) Manual provides insight into what an auditor may target early in the review:

“It is important to note here that information obtained should cover the same observation period as specified by the MDS items on the assessment, and should be validated for accuracy (what the resident’s actual status was during that observation period) by the IDT completing the assessment. As such, nursing homes are responsible for ensuring that all participants in the assessment process have the requisite knowledge to complete an accurate assessment.” 

“While CMS does not impose specific documentation procedures on nursing homes in completing the RAI, documentation that contributes to identification and communication of a resident’s problems, needs, and strengths, that monitors their condition on an on-going basis, and that records treatment and response to treatment, is a matter of good clinical practice and an expectation of trained and licensed health care professionals. Good clinical practice is an expectation of CMS. As such, it is important to note that completion of the MDS does not remove a nursing home’s responsibility to document a more detailed assessment of particular issues relevant for a resident. In addition, documentation must substantiate a resident’s need for Part A SNF-level services and the response to those services for the Medicare SNF PPS.” 

Insufficient documentation is a problem on many levels, so the facility needs to understand where gaps may exist. For example:

• Is there a process to validate MDS items that impact payment, to ensure they are supported in the medical record prior to billing?
• Does the interdisciplinary team meet to discuss the patient from admission through the assessment reference date, to ensure all services needed to support a skilled level of care (thus medical necessity) are being documented, and can then be reported on the MDS? 
• Is the electronic health record (EHR) configured for optimizing staff utilization and efficiencies?
  

Enhance Clinical Outcomes with Richter

As the industry’s leading clinical consultants for skilled nursing facilities, we are uniquely qualified to help you identify areas of risk and develop corrective strategies that will improve denial rates and revenue cycle performance. We offer:

•    Assessments of the interdisciplinary team process
•    Audits to verify the HIPPS billed is supported in the medical record
•    MDS and interdisciplinary team education for new hires or tenured staff
•    Development of a pre-bill validation process
•    PointClickCare^© database review 
•    Compliance program assessments

To learn more about our PointClickCare^© data base reviews, clinical consulting services for skilled nursing facilities, contact us here or call us at 866.806.0799.

1. Medicare Benefit Policy Manual Chapter 8 – Coverage of Extended Care (SNF) Services
2. Centers for Medicare and Medicaid Services Long Term Care Facility Resident Assessment Instrument User’s Manual, Version 1.18.11 effective October 1, 2023 retrieved: November 1, 2023 from Minimum Data Set 3.0 Resident Assessment Instrument User’s Manual v1.18.11 (cms.gov)
3. Centers for Medicare and Medicaid Services Long Term Care Facility Resident Assessment Instrument User’s Manual, Version 1.18.11 effective October 1, 2023 retrieved: November 1, 2023 from Minimum Data Set 3.0 Resident Assessment Instrument User’s Manual v1.18.11 (cms.gov)
4. Under Hospital Insurance (Rev. 10880; issued 08-06-21). Retrieved11.1.2023. 
5. Medicare Benefit Policy Manual (cms.gov)