The Proposed Patient-Driven Payment Model (PDPM): 10 Things You Need to Know

In April 2018, the Centers for Medicare and Medicaid Services (CMS) threw yet another curveball at (MDS) coordinators and skilled nursing facilities (SNFs) across the country. CMS’ original plan to introduce RCS-1 (resident classification system, the proposed new federal payment system) was overturned and replaced by the now proposed patient driven payment model (PDPM). This new payment model does have similarities to the previous RCS-1, but there were improvements made to increase payment accuracy.

It’s important to be aware of PDPM and understand its significance to your long-term post-acute care organization. Below are the top 10 things you  need to know about PDPM:

1. PDPM uses clinical conditions to determine the resident’s therapy payment category, rather than the amount of therapy provided. Payment would be based on the sum of the five component case-mix group (CMG) rates. Based upon RCS-1 feedback, CMS has condensed the number of CMGs possible under PDPM resulting in a lower figure.
   • Physical therapy
   • Occupational therapy
   • Speech language pathology
   • Nursing
   • Non-therapy ancillary services
2. Nursing categories continue to be determined by the residence conditions and the services through the RUG IV classification system.
3. Physical therapy case mix grouper will be determined by the following:
   • Clinical categories
   • Functional score now based on Section GG (late Late loss Loss ADLs and two early Early loss Loss ADLs)
   • Cognitive score
4. Occupational therapy case mix grouper will be determined by the following:
   • Clinical categories
   • Functional score now based on Section GG (late Late loss Loss ADLs and two early Early loss ADLs)
   • Cognitive score
5. Speech and language case mix grouper will be determined by the following:
   • Clinical categories
   • Swallowing disorder
   • SLP comorbidity or cognitive impairments
6. Non-therapy ancillary services (NTAS) case mix grouper will be determined by the following:
   • Comorbidity extensive services score
   • NTAS tier
   • Age
7. Nursing case mix grouper will be determined by the following:
   • Existing nursing resource utilization group (RUG) - will use 25 RUGS IV nursing categories
   • Functional measure based on Section GG
   • Continue using depression symptoms and restorative nursing services to further adjust the case mix index score.
8. Non-therapy ancillary NTA services are used to adjust the case mix overall score; they consist of a score for a number of comorbidities coded on the MDS. There are 50 comorbidity conditions considered for the NTA score.
9. Eighteen items will be added to the MDS PPS discharge MDS assessment to capture the total amount of therapy provided during the Medicare stay. CMS has added more detailed requirements for reporting therapy minutes on the discharge MDS to track delivery of therapy. Under RCS-1, SNFs only would have had to report minutes while under PDPM; SNFs must report using an array of therapy service delivery codes.
10. The Medicare 5-day and Medicare PPS discharge MDS will be the only MDS assessments required. The 5-day MDS will establish the PDPM payment category for the entire Medicare stay, unless an interim payment assessment is warranted due to a substantial change in the resident. An Interim Payment Assessment (IPA) may be used to capture significant changes in resident condition during thee stay. An IPA would be completed if the change or changes are such that the resident would not be expected to return to his or her original clinical status within a 14-day period. The IPA is meant to capture substantial changes to a resident’s clinical condition, not every day, frequent changes. CMS believes 14 days gives the facility an adequate amount of time to determine whether the changes identified are, in fact, routine or substantial. To clarify: The change in classification group described above refers to not only a change in one of the first-tier classification criteria in any of the proposed payment components, but also to one that would be sufficient to change payment in either one component or in the overall payment for the resident.

Factoring all of the changes together, I truly believe this could be a positive change for our industry. While we will get paid less for therapy-intensive residents, we will get paid substantially more for clinically complex residents. This payment shift will cause us to provide therapy services based on resident need and not reimbursement. MDS coordinators will also have fewer assessments to complete and more time to focus on care planning and the development of patient-centric care. This can only lead to an increase in patient satisfaction and positive outcomes.