A new mindset for skilled nursing

Medicare’s new payment model will bring about ‘scores of changes’ for skilled nursing facilities in October

Scores of changes – including significant scoring changes under new payment methodology -- are ahead for the nation’s skilled nursing facilities when a new Medicare payment model takes effect Oct. 1.

A patient’s functional and cognitive status will be important determinants for payment to skilled nursing facilities under the new Patient-Driven Payment Model (PDPM), requiring clinicians to learn new scoring and assessment procedures.

In the case of functional impairment, for example, the score will be calculated in a manner directly opposite from the method used under the current payment model.

“It’s all going to be much different under PDPM,” said J’non Griffin, owner and president of Home Health Solutions, a nationwide consulting and outsourcing firm which has served the home health and hospice industries since 2012.

Her Alabama-based company has launched a new Long-Term Care Solutions division in anticipation of PDPM-inspired need among skilled nursing facilities for training, consulting and outsourcing during the adjustment period ahead.

“A whole new mindset will be required for skilled nursing facilities for fiscal year 2020, when PDPM takes effect, with an especially sharp learning curve in the first year of implementation,” J’non said.

Coding accuracy

The new complex new payment model uses five primary components – physical therapy (PT), occupational therapy (OT), speech language pathology (PLT), nursing and non-therapy ancillary services (NTAS). Each of those five components contains resident classifications to determine a case-mix index on which a per diem rate will be based.

ICD-10 coding will play an integral role, driving the case mix groups and demanding coding accuracy for mapping codes into the correct clinical categories, J’non said. The patient’s co-morbidities will also play a significant role under the new payment methodology, helping to classify the patient in the case-mix index.

“We are anticipating larger numbers of skilled nursing facilities turning to outsourced coding services to ensure coding accuracy under PDPM,” J’non said. “Many facilities may find the new coding requirements much more extensive than what they have been accustomed to in the past.”

Changes ahead

Many of the changes coming about under the new payment model will align payment for skilled nursing facilities with other post-acute care facilities. The change in how a patient’s functional impairment is scored, for example, will make the approach used by skilled nursing facilities consistent with the scoring method used in other care settings, such as in-patient residential facilities (IRFs.)

As part of assessing care needs, skilled nursing facilities already evaluate patient characteristics such as a patient’s ability to complete certain Activities of Daily Living, known as ADLs, and the presence of any sort of cognitive impairment.

Under PDPM, however, the methodology used to score those patient characteristics will undergo extensive changes.

“Both functional and cognitive factors are payment group classifiers in the case-mix classification that makes up the current SNF Prospective Payment System (PPS), but PDPM will make substantial changes to how functional and cognitive scoring are used within the payment system,” J’non said.

She offered two examples of scoring changes ahead under PDPM.

1. Functional scoring: Under the current system, a patient’s Activities of Daily Living (ADL) scores are tracked for functional dependence rather than independence. The more dependent the patient, the higher the points. PDPM will switch that up, with new methodology requiring a completely opposite approach.

“Beginning in October, the higher the patient’s level of independence, the higher the points,” J’non said.

2. A new cognitive score: New cognitive scoring methodology will be used under PDGM. Under the current system, assessments such as a Brief Interview for Mental Status (BIMS), or a Staff Assessment for Mental Status used when a BIMS cannot be completed, are used to determine cognitive function. PDPM methodology requires certain assessments and makes it possible to derive a new cognitive score by combining scores into one scale which can be used to compare cognitive function. "These are just two examples of the extensive changes facing skilled nursing facilities under PDPM," J'non said. "It's going to have a huge impact on the industry."

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