Reaching Your Reimbursement Potential with the Patient Driven Payment Model (PDPM) for Skilled Nursing Facilities

Key Takeaways

• PDPM emphasizes patient-centred care, shifting reimbursement focus from the volume of therapy services to individual patient needs for better outcomes.
• A needs assessment can help you identify where you’re already complying with PDPM standards and where your gaps are.
• The MDS 3.0 assessment tool can collect resident information directly mapped to the PDPM case-mix classification system.
• Create personalized treatment plans with the input of patients and caregivers. Once you’re up and running with PDPM, you’ll unlock many new reimbursement opportunities, including COPD assessments, interim payment assessments and resident transition to restorative nursing care.

Prepare for the Patient-Driven Patient Model (PDPM)

PDPM is another giant step that the Centers for Medicare & Medicaid Services (CMS) is taking away from fee-for-service and toward value-based care. If your skilled nursing facility (SNF) isn’t there yet, it’s a good time to catch up.

First, understand how the new PDPM model is different from any previous model. In a few words, it’s patient-driven.

It puts Medicare Part A patients into different reimbursement categories based on their:

• Diagnosis
• Functional ability and limitations
• Cognitive impairment
• Co-occurring conditions
• Level of care needed after SNF discharge

Components include:

• Physical therapy (PT)
• Occupational therapy (OT)
• Speech-language pathology (SLP)
• Nursing
• Non-therapy ancillary (NTA)

While not mandatory yet, the CMS is moving swiftly in this direction.

At a glance: steps SNFs can take toward PDPM

• Take a deeper dive into PDPM reimbursement
• Understand the minimum data set (MDS 3.0) that SNFs need to adopt PDPM
• Conduct a needs assessment for your facility
• Begin aligning your services to PDPM patient outcome categories
• Initiate measurable quality improvement programs such as resident safety, pain management and wellness engagement
• Look at your resource allocation to optimize and document your efforts

Check out the PDPM Toolkit.

Old Resource Utilization Group Version IV (RUG-IV) case-mix classification system vs. new PDPM

The old RUG-IV system was based on the amount of therapy services a patient received in minutes. The PDPM is based on how well SNFs meet individual resident healthcare needs.

PDPM emphasizes patient-centred care to prevent over- or under-delivery of services. Care is customized to each resident’s unique characteristics, which benefits SNFs as well as residents, with:

• The right level of treatment
• Emphasis on prevention
• Reduced hospital readmissions
• Better payment accuracy

Conducting a needs assessment

A needs assessment can help you identify where you’re already complying with PDPM standards and where your gaps are. Think of it as your roadmap to your destination of PDPM reimbursement.

Your assessment should span:

• Resident diagnoses, functional abilities, therapy needs and lengths of stay
• Staffing levels, skill sets and allocation across each of the PDPM therapies, from physical therapy to non-therapy ancillary
• Technology infrastructure, including data management, EHR and reporting
• Alignment of clinical documentation to PDPM requirements
• Comparison of current coding and classification against PDPM
• Development of care plan templates focused on functional outcomes

Throughout your assessment, keep staff training needs and growth opportunities in mind.

Gathering the Minimum Data Set (MDS 3.0)

Like all things value-based care, PDPM relies on timely, accurate data. How do you get there? The MDS 3.0 assessment tool can collect resident information directly mapped to the PDPM case-mix classification system.

Data points include:

• Physical functioning
• Cognitive ability
• Medical conditions
• Activities of daily living (ADLs)
• Social needs
• Mental state

Once the data is captured, residents are assigned to a payment group automatically, which directly impacts reimbursement.

The advantages of the new model include:

• Accurate reimbursement for residents across a range of needs
• Built-in quality care monitoring that can help you qualify for CMS reimbursement incentives like the SNF Value-Based Purchasing (SNF VBP) program
• Secure data sharing with other healthcare providers for better care coordination and communication
• Automatic tracking of one-on-one therapy minutes, which are required to be 75% of total time — with only 25% of therapy in group settings

The importance of resident participation

A big part of personalizing treatment plans is getting the input of patients and caregivers and encouraging healthy habits like exercise.

Residents are more likely to comply with treatment and wellness plans if they’ve had a say in them because:

• Inclusion fosters a sense of ownership and cooperative spirit Tailored activities engage residents based on their interests and abilities Being heard reduces feelings of frustration

You can help residents stay motivated by:

• Asking for feedback
• Encouraging open communication
• Offering a range of exercise options and activities
• Giving positive reinforcement

The PDPM stresses the importance of regularly evaluating resident progress to keep care plans in line with changing needs and reimbursement levels.

Up and running and maximizing reimbursements

As you’re experiencing the growing pains that always come with change, keep the gains in mind to stay motivated and cheer your staff on. Take a look at just a handful of the many new reimbursement opportunities you’ll have under PDPM with documentation and proper coding in your minimum data set.

• Resident COPD assessment
• Interim Payment Assessment (IPA) after a change in a resident’s clinical characteristics
• Patient Health Questionnaire Depression Module (PHQ-9) screening, based on the DSM-V — rate honestly, not lower than what you observe
• Brief Interview for Mental Status (BIMS) — don’t give hints if the resident can’t answer
• Resident transitions to restorative nursing care after physical, occupational or speech therapy to maintain mobility and independence

Frequently Asked Questions

What is the new Patient Driven Payment Model (PDPM)?

The Patient-Driven Payment Model (PDPM) is the new Medicare reimbursement model for SNFs, emphasizing patient-centered care and accurate payment calculations.

What is the difference between the old RUG-IV payment model and the new PDPM?

The old RUG-IV system was based on the amount of therapy services a patient received in minutes. The new PDPM is based on how well SNFs meet individual resident healthcare needs.

PDPM emphasizes patient-centred care to prevent over- or under-delivery of services. Care is customized to each resident’s unique characteristics.

How does PDPM affect the delivery of care in skilled nursing facilities?

PDPM requires personalized treatment plans, regular monitoring, resident participation and one-on-one instead of group attention 75% of the time.

How can skilled nursing facilities prepare for PDPM?

• Take a deeper dive into PDPM reimbursement
• Understand the minimum data set (MDS 3.0) that SNFs need to adopt PDPM
• Begin aligning your services to PDPM patient outcome categories
• Initiate measurable quality improvement programs such as resident safety, pain management and wellness engagement
• Look at your resource allocation to optimize and document your efforts

Check out the PDPM Toolkit.

What should a needs assessment in preparation for PDPM include?

• Resident diagnoses, functional abilities, therapy needs and length of stay
• Staffing levels, skill sets and allocation across each of the PDPM therapies, from physical therapy to non-therapy ancillary
• Technology infrastructure, including data management, EHR and reporting
• Alignment of clinical documentation to PDPM requirements
• Comparison of current coding and classification against PDPM
• Development of care plan templates focused on functional outcomes

Help me stay motivated. What new reimbursements will my SNF be eligible for under PDPM?

Take a look at just a handful of the many new reimbursement opportunities you’ll have under PDPM with documentation and proper coding in your minimum data set.

• Resident COPD assessment
• Interim Payment Assessment (IPA) after a change in a resident’s clinical characteristics
• Patient Health Questionnaire Depression Module (PHQ-9) screening, based on the DSM-V — rate honestly, not lower than what you observe
• Brief Interview for Mental Status (BIMS) — don’t give hints if the resident can’t answer
• Resident transitions to restorative nursing care after physical, occupational or speech therapy to maintain mobility and independence

Why are residents more likely to comply with personalized treatment plans they have a say in?

• Inclusion fosters a sense of ownership and cooperative spirit
• Tailored activities engage residents based on their interests and abilities
• Being heard reduces feelings of frustration

How can you help residents stay motivated to comply with their personalized treatment plan?

• Asking for feedback
• Encouraging open communication
• Offering a range of exercise options and activities
• Giving positive reinforcement

What is the difference between fee for service (FFS) and Value Based Care (VBC)?