Long Term Care Issues. HFMA Healthcare Financial Management Association Thursday March 17 th 2011 Los Angeles, CA

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1 Long Term Care Issues HFMA Healthcare Financial Management Association Thursday March 17 th 2011 Los Angeles, CA

2 Presenter Michael Lesnick Ron Wall Axiom Healthcare Group

3 Topics Medicare RUG IV Categories Questionable Billing Practices in SNFs OIG Report A Gaze Into the Future 3

4 RUG-IV Overview What Are The Thirty (30) Most Critical Things To Know About RUG-IV? 4

5 RUG-IV Overview What Are The Thirty (30) Most Critical Things To Know About RUG-IV? MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0. MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0. MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0. MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0. MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0. MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0, MDS 3.0 5

6 Implementation Date RUG-IV Overview Originally Now Payment Under RUG-IV Effective With A Catch Starting you will be paid under the 66 category RUG-IV classification system, BUT, you will be earning the 53 category RUG-III HYBRID rates GREAT NEWS RUG IV Delay Is Repealed! There will NOT be a RUG III Hybrid To Deal With 6

7 RUG-IV Adjustment to RUG-III HYBRID Currently the only Grouper Software that will function under MDS 3.0 will only produce the RUG-IV grouping In other words CMS can NOT comply with the law that mandates a RUG-III payment under the MDS 3.0 Therefore, you get paid RUG-IV rates now and sometime in the coming months CMS will figure out how to take the difference between RUG-IV and RUG-III HYBRID rates back from you GREAT NEWS RUG IV Delay Is Repealed! There will NOT be a RUG III Hybrid To Deal With! Happy Holidays! President Obama has delivered the LTC industry with a holiday gift by signing into law the Medicare and Medicaid Extenders Act of Section 202 of the MMEA repeals the delay of the Skilled Nursing Facility (SNF) PPS RUG-IV classification system. Therefore, RUG- IV will continue to remain in effect from October 1, 2010, as previously implemented by the final SNF payment regulation for FY All claims processing activities shall proceed in accordance with the existing instructions. (Big Sigh) And to All a Good Night! 7

8 NEW Rates Look GREAT!!!! Or Do They???????????????? If you simply compare the Old Rates (FY 10 Rates) to the New Rates (the FY 11 Rates) It looks like you will have a very significant increase. Please be aware that under MDS 3.0 and the new rules about Therapy Minutes and Look Back Periods, it will be much more difficult to achieve the higher RUG categories and to get Therapy minutes recorded. Also, remember you are earning only the RUG-III Hybrid rates that are lower than the RUG-IV rates 8

9 Why Is It More Difficult To Get Into Various RUG Categories? Extensive Rehabilitation 9

10 More Difficult To Get Into Extensive Categories To date, the vast majority of the extensive qualifiers occurred in the acute care hospital before admission to the SNF Look Back Periods will be modified to prohibit providers from taking credit for certain services (specifically the extensive qualifiers) that occur in the acute care hospital before admission to the SNF For RUG-IV purposes, the look back period for section P1a items will NOT include any services rendered before the patient was admitted to the SNF Services prior to admission (those provided in the hospital) are still recorded, but, only for Care Planning purposes, not for reimbursement purposes 10

11 More Difficult To Get Into Extensive Categories Qualifiers for Extensive Categories Have Changed The Number of Extensive qualifiers is reduced The Remaining Extensive qualifiers are: Existing - Tracheotomy Care IN THE NURSING HOME ONLY Existing - Ventilator / Respirator Care IN THE NURSING HOME ONLY NEW Isolation QUARANTINE for an active infectious disease IN THE NURSING HOME ONLY 11

12 What Is Isolation QUARANTINE? Examples Of Conditions That Do Qualify Active Cases of TB Neutropenic Precautions Isolation (look it up) Active Shingles (Airborne) MSRA In The Respiratory Tract with Wet Productive Cough (Airborne) Examples of Conditions That Do NOT Qualify Normal MDROs (Multi Drug Resistant Organisms) MSRA VRE Not What SNFs Typically Call Isolation 12

13 Extensive Qualifiers That Have Been Eliminated Some of the services that were formerly extensive qualifiers will be moved to other categories Parenteral / IV Feeding moves to Special Care High IV Medications moves to Clinically Complex Suctioning has been dropped completely as a qualifier 13

14 Why Is It More Difficult To Get Into Section T Eliminated REHAB Categories? Counting Minutes Modified Concurrent Therapy Aide Time 14

15 Counting Rehab Minutes The manner in which Therapy minutes are counted has been modified Method Of Rehab Delivery Individual Therapy No Change Group Therapy No Change (Be Careful About Coverage Criteria) Concurrent Therapy Minutes Will be allocated / Limited to 2 patients (1/2 of time counted for reimbursement purposes) 15

16 Counting Rehab Minutes Aide Time Is essentially limited to set up time The old practice of counting all of the aides time (for a Part-A patient) under line of sight supervision by a licensed therapist is no longer acceptable, only the setup time is counted 16

17 Value of Categories Has Shifted Essentially Rehab is worth less under RUG-IV and NON-Rehab (Extensive / Medical) Conditions are worth more 17

18 RUG-IV Overview Impact On Rates / Payments Overall Payments to SNFs WERE expected to be Budget Neutral, with a SIGNIFICANT reshuffling of the payments among categories. There be a reshuffling, but, with the move directly to RUG IV the overall cost to the government will NOT be budget neutral. 18

19 RUG-IV Overview Winners & Losers In a very global sense, therapy services will be worth less and complex medical services (actually performed in the SNF) will be worth more Therapy reimbursement remains very attractive and will continue to be a major element of Medicare reimbursement. 19

20 RUG-IV Overview Winners & Losers SNF Most Likely to be negatively affected NOTE LOSSES ARE MITIGATED BY THE SKIP DIRECTLY TO RUGIV SNFs with a high percentage, over 35% of X s and L s (Rehab PLUS Extensive category patients) that are based on extensive services provided in the acute care hospital SNFs with a high percentage of Rehab Category Patients (over 75% to 80%) 20

21 RUG-IV Overview Winners & Losers Payments for the Special Care (High & Low) and Clinically Complex categories will be worth more relative to the old RUG-III rates 21

22 RUG-IV Overview RUG-IV Significant Changes The ADL Index / Scoring will be adjusted RUG-IV ranges for 0 to 16 RUG-III ranged from 4-18 Feeding ADL scoring has been modified 22

23 RUG-IV Overview RUG-IV Significant Changes Revisions to calculation of Therapy minutes will be implemented. You will need to indicate on the MDS 3.0 what delivery mode is being used for rehab services: Individual Therapy Group Therapy Concurrent Therapy 23

24 RUG-IV Overview RUG-IV Significant Changes Look Back Periods for Section P1a will eliminate credit for services rendered before the patient is admitted to the SNF 24

25 RUG-IV Overview RUG-IV Categories Total Number of Categories will change from 53 to 66 There will be a variety of changes within the categories 25

26 RUG-IV Overview RUG-IV Categories: Extensive plus Rehab Services Rehab Categories Extensive Services Special Care High Special Care Low Clinically Complex Behavioral & Impaired Cognition Reduced Physical Function 26

27 RUG-IV Overview RUG-IV Other Issues Level of Care / Presumption of Coverage # of categories will change where there is at least an initial presumption of coverage. CORRECTLY ASSIGNED to one of the UPPER 52 ON THE INITIAL 5-DAY MDS 27

28 Level of Care / Presumption of Coverage Nursing Facility Level-of-Care Criteria As discussed in , we include in each update of the Federal payment rates in the Federal Register the designation of those specific RUGs under the classification system that represent the required SNF level of care, 28

29 Level of Care / Presumption of Coverage This designation reflects an administrative presumption under the 66-group RUG IV system that beneficiaries who are CORRECTLY ASSIGNED to one of the UPPER 52 RUG IV groups on the initial 5-day, Medicare-required assessment are automatically classified as meeting the SNF level of care definition up to and including the assessment reference date on the 5-day Medicare required assessment 29

30 RUG-IV Strategies RUG-IV Overview Work with your therapy vendors as soon as possible to adapt to RUG-IV. Focus on the following with them: New Methods for counting minutes Concurrent Therapy Group Therapy Does It Meet Coverage Criteria? New Payment Levels for Rehab Categories Use of Therapy Aides 30

31 Concurrent & Group Therapy Concurrent & Group Therapy are appropriate if utilized PROPERLY Concurrent and Group Therapy are still allowable and should be used in the appropriate situations However, you need to understand the LIMITS that apply to each mode of delivery 31

32 RUG-IV Overview RUG-IV Strategies Work with your clinical staff to enhance your capacity to provide clinically complex services such as Ventilator/Respirator and quarantine, IN YOUR SNF 32

33 RUG-IV Overview RUG-IV Strategies Enhance Your capacity to complete complex services including, but not limited to: IV Services Complex Wound Care Respiratory & Cardio Respiratory Programs 33

34 RUG-IV Overview DANGER What Medicare Gives, the OIG and Take Away Please Read the OIG Report Questionable Billing Practices By Skilled Nursing Facilities After you have read this report, take the appropriate actions to protect yourself against and billing problems. 34

35 Questionable Billing Practices By Skilled Nursing Facilities Released December 2010 Report # EI Points Out A Variety of Issues The OIG is Concerned About 35

36 Questionable Billing Practices By Skilled Nursing Facilities 26% of Claims Submitted by SNFs NOT Supported by the Medical Record Increase in Ultra High Therapy Billing NOT JUSTIFIED For Profit providers Far More Likely to have problems Length of Stay Longer Than Necessary ADL Scores Inappropriately High 36

37 Questionable Billing Practices By Skilled Nursing Facilities This report along with the ongoing RAC program and increased scrutiny from many agencies and investigators makes being in compliance with applicable guidelines more important than ever. 37

38 A Gaze Into the Future Pay For Performance (P4P) Accountable Care Organizations / Bundling 38

39 Pay for Performance P4P What is it? (Overview) Why is this concept being pushed? P4P Initiatives In Other States How Will Providers be Paid? Where Will the Money Come From? California s Plan Qualifying - Scoring DISQUALIFIERS How Will They Get the Data? Who Will Get the Data? 39

40 P4P What Is It? Pay for Performance (P4P) is a concept where providers reimbursement will be MODIFIED Some will get more Some will get (less) if they achieve certain goals or if they fail to achieve certain goals. 40

41 P4P Why is This Concept Being Promoted? To Reduce Cost To Stop Undesirable Patterns To Promote Desirable Actions (Quality?) 41

42 P4P Where Will the Money Come From? California will take money out of the existing pot by reducing payments to ALL providers. This initiative does NOT increase funding for nursing homes, it redistributes the existing pot of money. 42

43 California P4P Plan SB 853 (BTB) Reauthorization of AB 1629 A one year extension of the SNF reimbursement system until July 31, 2012 Establishment of a Skilled Nursing Facility Quality and Accountability Special Fund to reward providers that meet quality benchmarks in the following areas: Compliance with the 3.2 hppd staffing standard Immunization rates Use of physical restraints Facility acquired pressure ulcers Resident and family satisfaction Direct care staff retention, if sufficient data is available (Welfare & Institutions Code (i).) 43

44 California P4P Plan Q&A Fund - Quality of Care Improvement Measures To reiterate the six specific Quality Measures identified in the BTB are: 1. Immunization Rates 2. Facility Acquired Pressure Ulcers 3. Physical Restraint Rates 4. Compliance with Staffing Hour Requirements 5. Resident and Family Satisfaction 6. Direct Care Staff Retention (if sufficient data) 44

45 California P4P Plan Q&A Fund Developing the Payment Model How Many Dollars Are at Stake? For the initial incentive payment period $40 million is available Amount of facility-specific quality award payments will be determined annually based on performance criteria and the process 45

46 California P4P Plan The Ongoing California State Budget Negotiations Could Change Everything! 46

47 Accountable Care Organizations / Bundling ACOs & Bundling Could Change Our Future Anytime the Control of the Money is Placed in New Hands, the picture Changes The Impact On SNFs Is NOT Clear At This Time, But, It Is Advisable To Make Certain That You Stay Up To Date In This Area 47

48 Q&A 48

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