United States

Senior Living Health Care Connection: Final Medicare payment rule


The Centers for Medicare & Medicaid Services (CMS) on July 31, 2018, finalized the fiscal year 2019 Medicare payment rule for the skilled nursing facility (SNF) prospective payment system (PPS) which provides a 2.4 percent payment increase, or $820 million more in aggregate payments. Additionally, CMS finalized its proposed new SNF patient-driven payment model (PDPM) methodology. The PDPM starts fiscal 2020 effective Oct. 1, 2019. Per CMS, this model focuses on the patient’s condition and resulting care needs rather than on the amount of care provided in order to determine Medicare payment.

As we expected from the proposed rule, there are five case-mix adjusted components or case-mix groups:

1.  Physical therapy (PT)

2.  Occupational therapy (OT)

The primary diagnosis and the functional score will determine the PT and OT case mix.

3.  Speech language pathology (SLP)

Determination of this case mix is based on whether the primary diagnosis is acute neurologic or not, speech-related comorbidities, cognitive impairment, swallowing impairment or mechanically altered diet.

4.  Nursing

This category is based on RUG IV classifications: extensive services, special care high, special care low, clinically complex, behavior and cognitive performance, and reduced physical functioning.

5. Non-therapy ancillary services (NTA)

Classified into six case-mix groups.

Some of the major items to note related to the new PDPM reimbursement methodology are as follows:

  • CMS has finalized a combined limit on group and concurrent therapy of 25 percent and a minimum of 75 percent of individualized therapy expected per patient.
  • In this system, there are only two assessments required of the five-day and the discharge assessment.
  • Section GG will be used to classify patient’s functional scores.
  • For any stays over day 20 reimbursement will be reduced for PT and OT by 2 percent every seven days. 

This is a preliminary look at the final rule, particularly as it relates to PDPM. Look for more information on this in the near future and join us for a webcast regarding PDPM on Monday, Sept. 24. 

Questions? Contact Joan McCarthy at +1 312 634 3479.

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