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CMS pulls the “RUGs” out from under Providers Potential Effects of SNF PPS Final Rule

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SNF PPS Final Rule FY2012

• Published in August 8, 2011, Federal Register o http://www.gpo.gov/fdsys/pkg/FR-2011-08-08/pdf/2011-19544.pdf

• Effective October 1, 2011

• Applies to SNFs, hospital-based SNUs, & swing beds (except in CAHs)

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Polling Question

• Are you affiliated with free-standing SNF or hospital-based?

o SNF

o Hospital-based SNU or swing bed

o Neither

o Unsure

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SNF PPS Final Rule FY2012

• Rates are decreasing by an average of 11.1%

o “Parity” or “recalibration” adjustment – 12.6% decrease

o Market basket 2.7%, less 1.0% productivity adjustment = 1.7% net increase

• Cuts only apply to therapy categories

• Non-therapy rates actually went up slightly by net market basket increase

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Rehab Rates Comparison (Urban, not wage adjusted)

Category FY 2011 Urban rates FY 2012 Urban rates Decrease

RUX $ 869.42 $ 737.08 (132.34)

RUL 847.33 721.01 (126.32)

RVX 786.66 656.06 (130.60)

RVL 698.28 588.60 (109.68)

RHX 722.91 594.39 (128.52)

RHL 637.69 530.14 (107.55)

RMX 668.30 545.24 (123.06)

RML 611.49 500.27 (111.22)

RLX 593.60 478.85 (114.75)

RUC 634.27 558.79 (75.48)

RUB 634.27 558.79 (75.48)

RUA 512.75 467.23 (45.52)

RVC 551.51 479.38 (72.13)

RVB 467.86 415.13 (52.73)

RVA 466.28 413.52 (52.76)

RHC 487.76 417.71 (70.05)

RHB 434.10 375.95 (58.15)

RHA 375.71 330.97 (44.74)

RMC 434.73 366.95 (67.78)

RMB 403.17 344.47 (58.70)

RMA 324.26 283.43 (40.83)

RLB 431.05 356.78 (74.27)

RLA 263.76 229.89 (33.87)

Clinical Rates Comparison (Urban, not wage adjusted)

Category FY 2011 Urban rates FY 2012 Urban rates Increase

ES3 $ 661.20 $ 672.93 11.73

ES2 517.58 526.77 9.19

ES1 462.34 470.55 8.21

HE2 446.56 454.49 7.93

HE1 370.81 377.39 6.58

HD2 418.15 425.57 7.42

HD1 348.71 354.90 6.19

HC2 394.48 401.48 7.00

HC1 329.77 335.63 5.86

HB2 389.75 396.66 6.91

HB1 326.62 332.42 5.80

LE2 405.53 412.73 7.20

LE1 339.24 345.26 6.02

LD2 389.75 396.66 6.91

LD1 326.62 332.42 5.80

LC2 342.40 348.48 6.08

LC1 288.74 293.87 5.13

LB2 325.04 330.81 5.77

LB1 276.11 281.02 4.91

CE2 361.34 367.75 6.41

CE1 332.93 338.84 5.91

CD2 342.40 348.48 6.08

CD1 313.99 319.57 5.58

CC2 299.79 305.11 5.32

CC1 277.69 282.62 4.93

CB2 277.69 282.62 4.93

CB1 257.18 261.74 4.56

CA2 235.08 239.26 4.18

CA1 219.30 223.19 3.89

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Parity Adjustment

• Transition from RUG III to RUG IV in FY2011 was intended to be budget neutral

• Payments to providers for SNF days October 2010 through April 2011 were higher than CMS projected

• Payment increases largely attributable to o Higher than anticipated therapy utilization

o Increased utilization of ultra high & very high rehab RUG categories

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Expected vs. Actual RUG Distribution

RUG Category Groups

FY2009 actual RUGs III

distribution

CMS projected RUGs IV

redistribution

Actual distribution October 2010 to

April 2011

Rehab + Extensive Services

39% 4% 3%

Rehab Only 51% 79% 89%

Total Rehab 90% 83% 92% Ultra High & Very High 62% 37% 73%

Clinical 10% 17% 8%

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Parity Adjustment

• No retrospective recovery of current overpayments

• Cuts for FY2012 intended only to decrease future payments, not recoup FY2011 overpayments

BUT…

• Potential impact on FY2012 rates of other provisions in final rule was not considered

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Objectives

• Understand impact of PPS changes

• Understand MDS form changes

• Understand new OMRAs

• Know changes to group therapy

• Understand changes to PPS assessment

• Learn how to improve MDS & claim accuracy through effective strategies

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2012 Final Rule Changes

• Effective October 1, 2011

o MDS/PPS assessment schedule

o New Other Medicare Required Assessment (OMRA)

o CMS clarifications

o Group therapy

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PPS Assessment Schedule

New PPS Assessment Schedule Effective October 1, 2011

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CURRENT SCHEDULE NEW SCHEDULE

Assessment Type

Code

Applicable Medicare

Payment Days

Assessment Reference Date

Grace Days Assessment

Reference Date Grace Days

5 day or Readmission

01, 06 1 - 14 Days 1 - 5 Days 6 - 8 Days 1 - 5 Days 6 – 8

14 day 02 15 - 30 Days 11 - 14 Days 15 - 19 Days 13 - 14 Days 15 – 18

30 day 03 31 - 60 Days 21 - 29 Days 30 - 34 Days 27 - 29 Days 30 – 33

60 day 04 61 - 90 Days 50 - 59 Days 60 - 64 Days 57 - 59 Days 60 – 63

90 day 05 91 - 100 Days 80 - 89 Days 90 - 94 Days 87 - 89 Days 90 – 93

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PPS Assessment Schedule

• Why change????

o Avoid overlapping & duplication of data Example

5-day assessment with ARD on Day 8 of stay & 14-day assessment with ARD on Day 11 have four overlapping days

o More accurately reflect resident status Example

Interview of 14-day assessment will better reflect that person during payment period

Transition for Implementation

• CMS Policy Summary:

In order to reduce overlap between assessment look-back periods, Effective for FY 2012 (beginning October 1, 2011), facilities will utilize the revised MDS assessment schedule in Table 10B in the FY 2012 SNF PPS proposed rule (76 FR 26389), which was finalized in the FY 2012 SNF PPS final rule (76 FR 48517)

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Polling Question

• Is your facility at greater risk for CMS medical review if grace days are used frequently?

o Yes

o No

o Unsure

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New PPS Assessments

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New PPS Assessments

• Other Medicare Required Assessments (OMRAs)

o End of Therapy (EOT) OMRA-clarification

o End of Therapy-Resumption (EOT-R) OMRA (Not considered NEW assessment)

o Change of Therapy (COT) OMRA

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EOT– Clarification • Providers are required to complete an EOT OMRA when

resident in Rehab RUG does not receive therapy services for 3 consecutive days, regardless of reason for discontinuation of therapy.

o Planned (discharged)

o Unplanned (refusals, appointments, illness of patient, illness of therapist, holidays)

• Setting of ARD for the EOT is unchanged. You still may set your ARD on Day 1, 2 or 3 after discontinuation of therapy services

• Recommend do not SUBMIT immediately because…

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ARD of EOT (Example)

Friday Saturday Sunday Monday Tuesday

Therapy

Tx Ends

EOT ARD

Day 1 Day 2 Day 3

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EOT– R (Resumption)

• If therapy resumes within 5 days & RUG level stays unchanged from previous assessment.

o Facility completes an EOT-R or modifies EOT to an EOT-R and submits

o New therapy order or evaluation is not required

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EOT-R OMRA

• Therapy services resume within five consecutive days after last day of therapy

• Resume at same rehab RUG category

• No new therapy evaluation or SOT OMRA required

• A0310C = 2 or 3

• Complete O0450A & O0450B (new)

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EOT-R OMRA

• Example

o Therapy ends Day 35 of stay

o Resumes at same level by Day 39 of stay

o Resumption date is reported on EOT OMRA, if EOT OMRA has not been submitted

o If submitted, complete modification to EOT OMRA

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Polling Question

• Does your facility submit your PPS assessments within the same week as completion?

o Yes

o No

o Unsure

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EOT Modified to EOT-R

• Patient received therapy Monday – Friday • Therapy not provided Saturday & Sunday • Monday, patient refused therapy • EOT OMRA now required • Tuesday therapy was missed due to appointment • Missed therapy did not result in change in clinical condition

that would make him tolerate less therapy & change his RUG-IV classification

• EOT OMRA completed with ARD of Monday • On Wednesday, EOT is modified into EOT-R by reporting

actual date of resumption, which was Wednesday

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EOT-R OMRA

• If therapy does not resume by 5th consecutive day, SNF may not complete EOT-R OMRA

• SOT OMRA with new therapy evaluation can be completed 5-7 days after first day therapy starts (optional)

CMS Transition Instructions

• Effective for all EOT-OMRA assessments with an ARD on or after October 1, 2011.

• Effective October 1, 2011, facilities will be considered 7-day facilities for the purposes of setting the ARD for an EOT OMRA.

• As October 1, 2011 is a Saturday, this day should be counted as a day of missed therapy if a patient does not receive any therapy services on that day.

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CMS – ABN clarification

• Inquiries as to issuing ABN weekly on Friday

• ABN should inform beneficiary of providers belief Medicare will no longer pay for SNF stay

• CMS expects unplanned discontinuation to be rare

• If unplanned discontinuation in services occur repeatedly, provider should evaluate if patient continues to meet Medicare coverage criteria

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Polling Question

• As providers, are you monitoring patients’ therapy minutes beyond look-back period for assessments?

o Yes

o No

o Unsure

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Change Of Therapy (COT) OMRA

• Required when

o Patient in RUG-IV Rehab therapy group has change in intensity of therapy services (total RTM* delivered) no longer reflect classification & payment assigned

o New type of PPS assessment Uses same item set as EOT OMRA

*RTM - Reimbursable therapy minutes

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COT OMRA

• ARD of COT OMRA set for Day 7 of COT observation period

o COT observation period is rolling 7-day window

o Beginning day following most recent PPS assessment (scheduled or unscheduled)

or

o Beginning day therapy resumes when an EOT-R OMRA is completed

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COT OMRA

• Example o ARD of 14-day assessment is Day 14 of stay

o Day 1 of COT observation is Day 15 of stay

o Facility required to review therapy minutes for week of Day 15-21 of stay

o ARD of COT OMRA would be set for Day 21 of stay, if total RTM changed RUG classification

o If no change in RTM – no COT OMRA required

o Next evaluation of patient’s total RTM for purposes of completing COT OMRA, would occur on Day 28 of stay (new COT observation period – Day 22-28)

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Therapy Issues

• Reimbursable Therapy Minutes (RTM)

o Therapy minutes necessary to reach or to classify patient into certain RUG-IV categories; given allocation of individual, concurrent & group therapy minutes

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Group Therapy

• Revised definition of group therapy

o Therapy provided simultaneously to 4 patients who are performing similar therapy activities

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Group Therapy

• Allocation of group therapy

o Full time spent by therapy with group therapy would be divided by 4 (by the software) to give RTM

o Example For 1 hour of group session, 60 minutes would be entered on MDS for each resident in group. Software would divide 60 minutes by 4 to get 15 RTMs, which count toward RUG-IV Rehab group

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Group Therapy

• Group therapy documentation will need to be more specific

o Type of group therapy (Plan of Care)

o Number of participants in group

o Number of total minutes

o Monitor RTMs during ARD window

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Therapy Issues

• Therapy student – clarification

o Therapy students working in an SNF would no longer be required to be in supervising therapist’s line of sight

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Strategies for PPS 2012

• Medicare meeting

• Triple check

• Scheduling calendar to monitor pertinent assessment dates

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Medicare Meeting

• Meet daily

o Brief update on all Medicare Part A patients

• Meet weekly

o Review Medicare Part A & B

o Review Progress-rehab & clinical

• Meet monthly

o Triple check

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PPS Assessment Dates

• Pertinent dates to monitor

o Entry

o Discharge

o Medicare start & end dates

o Therapy start & end dates

o COT 7-day rolling window

o Therapy resumption date

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Managing PPS Assessments

• Communication between Medicare coordinator & therapy

o Change in patient condition or status Rehab or clinical

o Refusal of any skilled services

o Appointments or LOAs

o Plan of action for Holidays

o Discharge plans

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Strategies for Success

• Evaluate financial impact of rate reductions on your organization

o Cuts based on national average overpayments

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Polling Question

• Have you estimated the impact of the final rule on your facility?

o Yes

o No

o Unsure

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Strategies for Success – ADLs

• Evaluate & monitor ADL scoring

RUG category ADL score National %

Rehab C 11 – 16 32%

Rehab B 6 – 10 37%

Rehab A 1 – 5 31%

Medically Complex E 15 – 16 23% Equivalent to “C” for Rehab Medically Complex D 11 – 14 29%

Medically Complex C 6 – 10 23% Equivalent to “B” for Rehab

Medically Complex B 2 – 5 15% Equivalent to “A” for Rehab Medically Complex A 0 – 1 10%

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Polling Question

• Is training for ADL capture part of your staff orientation program?

o Yes

o No

o Unsure

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Strategies for Success – ADLs

• ADL examples RUG category ADL score Urban rate per day Impact

RVC 11 – 16 $ 479 difference $ 64 per day

RVB 6 – 10 $ 415 $ 1,920 for 30 days

LD2 11 – 14 $ 397 difference $ 49 per day

LC2 6 – 10 $ 348 $ 1,470 for 30 days

CD1 11 – 14 $ 320 difference $ 37 per day

CC1 6 – 10 $ 283 $ 1,110 for 30 days

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Strategies for Success – Depression

• Mood interview results (clinical RUG categories only)

o National averages 13% with depression

87% without depression

• Examples of scoring depression

RUG category PHQ score Urban rate per day Impact

HE2 ≥ 10 $ 454 difference $ 77 per day

HE1 0 – 9 $ 377 $ 1,078 for 14 days

LE2 ≥ 10 $ 413 difference $ 68 per day

LE1 0 – 9 $ 345 $ 952 for 14 days

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Strategies for Success – Rates FY2012 Category Rate per day Rank

RUC $ 559 1

RUB 559 1

RVC 479 3

RUA 467 4

HE2 454 5

HD2 426 6

RHC 418 7

RVB 415 8

RVA 414 9

LE2 413 10

HC2 401 11

HB2 397 12

LD2 397 12

HE1 377 14

RHB 376 15

CE2 368 16

RMC 367 17

RLB 357 18

HD1 355 19

LC2 348 20

Strategies for Success – Rates 2012

Category Rate per day Assume PPD Therapy

Cost @ $1.05 / minute Net Rate per day Rank

HE2 $ 454 $ 454 1

RUC 559 $ (108) 451 2

RUB 559 (108) 451 2

HD2 426 426 4

LE2 413 413 5

RVC 479 (75) 404 6

HC2 401 401 7

HB2 397 397 8

LD2 397 397 8

HE1 377 377 10

RHC 418 (49) 369 11

CE2 368 368 12

RUA 467 (108) 359 13

HD1 355 355 14

RLB 357 (7) 350 15

LC2 348 348 16

CD2 348 348 16

LE1 345 345 18

RMC 367 (22) 345 19

RVB 415 (75) 340 20

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Strategies for Success

Week 1 Week 2 Week 3 Week 4 Week 5 Total

Assessment 5 - day 14 - day Dischg

Category RVC RVC RVB RVB Medicaid 28 MC days 7 MD days

Rate per day $ 551.51 $ 551.51 $ 467.86 $ 467.86 $ 150.00 $ 437.77 avg

Week total $ 3,861 $ 3,861 $ 3,275 $ 3,275 $ 1,050 $ 15,322

Therapy min 500 500 500 500 –

Therapy cost $ 525 $ 525 $ 525 $ 525 ($ 2,100)

Reimbursement, net of therapy cost $ 13,222

Current Care Model – Current Rates

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Strategies for Success

Week 1 Week 2 Week 3 Week 4 Week 5 Total

Assessment 5 - day 14 - day Dischg

Category RVC RVC RVB RVB Medicaid 28 MC days 7 MD days

Rate per day $ 479.38 $ 479.38 $ 415.13 $ 415.13 $ 150.00 $ 387.83 avg

Week total $ 3,356 $ 3,356 $ 2,906 $ 2,906 $ 1,050 $ 13,574

Therapy min 500 500 500 500 –

Therapy cost $ 525 $ 525 $ 525 $ 525 ($ 2,100)

Reimbursement, net of therapy cost $ 11,474

Change from FY2011 (13.2%) ($ 1,748)

Current Care Model – FY2012 Rates

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Strategies for Success

Week 1 Week 2 Week 3 Week 4 Week 5 Total

Assessment 5 - day 14 - day COT 30 - day, + COT

ARD Day 2 (no SOT) Day 14 (RHC) Day 21 Day 28

Category HE2 HE2 RUB RVB RVB 35 MC days

Rate per day $ 454.49 $ 454.49 $ 558.79 $ 415.13 $ 415.13 $ 459.60 avg

Week total $ 3,181 $ 3,181 $ 3,912 $ 2,906 $ 2,906 $ 16,086

Therapy min – 325 720 500 500

Therapy cost – $ 341 $ 756 $ 525 $ 525 ($ 2,147)

Reimbursement, net of therapy cost $ 13,939

Care Management Model – FY2012 Rates

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Strategies for Success

• Re-evaluate your care model o Resident’s clinical needs as important as therapy needs

o Monitor & train ADLs

o Capture depression for clinical RUG categories

o Understand hierarchy of all RUG rates

o Consider cost of therapy when selecting RUG category

• Manage delivery of care from admit to discharge o Work as an interdisciplinary team

o Do pre-assessment screening

o Evaluate all resident’s needs

o Compare ALL potential RUG categories

o Plan appropriate care

o Set ARDs for most benefit

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Strategies for Success

• Partner with your therapy provider

o Make sure they are “on board”

o Negotiate adequate payment for therapy services, even in non-rehab categories

• Manage expectations

o Staff

o Physicians

o Family

• Re-examine philosophy

• Influence behaviors

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Questions?

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Upcoming Webinar

• Issues in Unrelated Business Income for Health Care

o Thursday, September 8, 10:00-11:00 a.m. Central time

To register or for more information go to www.bkd.com/webinar/healthcare

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Director

918.584.2900

lbrunholtz@bkd.com

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