Advanced Therapy Management

Risk Advanced Therapy Management The larger the risk the more incentive to actively change behavior to control costs and provide only those services that are medically necessary 3 Thoughts About Risk Medicare is shifting from a Fee For Service model to Risk Based systems Bundling Shared savings (ISNP, ACOs) Our entire business model is based on per day FFS and utilization (RUGs, HCPCS) Shift towards episodic payment and shared savings will require new metrics The time is now to start gathering data Agenda Therapy Department Operations Productivity vs. Efficiency Cost per Unit/Minute Profitability Episodic Cost Outcomes 2 4 ZIMMETHEALTHCARE SERVICES GROUP, LLC 1

Daily Operations Therapist Staffing Therapist Scheduling/Caseloads Interdisciplinary Meetings Activity (Medicare/Managed Care/Medicaid) Monitoring Therapist Staffing Therapist Scheduling/Caseloads Straight v. Adjusted Productivity Straight Productivity = Hours Billed/Hours Worked Adjusted = Hours Billed/Therapy Clock Time Clock Time is defined as the actual amount of time needed to complete the resident caseload, incorporating the mode of therapy Factors in Mode of Therapy 5 Regulations Dictate Modalities Straight Productivity Therapy is one of our biggest cost centers and is our greatest revenue driver today. Loss of Concurrent and Group therapy has altered treatment models and made therapy more expensive Efficiency becomes essential (Resident Readiness) How do we treat Managed Care residents? How will we alter model under Bundled payment? How will we pay Contract Therapy companies? 6 ZIMMETHEALTHCARE SERVICES GROUP, LLC 2

Adjusted Productivity Cost Per Unit/Minute Therapist treatment time Billable hours, units or minutes Excludes: 1. Screens 2. Team/family meeting 3. Documentation 4. Administrative management 11 Cost Per Unit/Minute Factors Impacting Costs Department Costs Therapist/assistant salary Benefit burden Cost of Health Insurance PTO Employer costs Administrative staff Per diem/weekend staffing Agency costs Manager productivity Therapist/Assistant ratio NY: 4:1 NJ: 2:1 Median salary: PT $88,000: PTA $48,000* Benefit burden Medical/Dental Benefits PTO *APTA 2010 and 2009 Median Income of Therapist Summary Report 10 12 ZIMMETHEALTHCARE SERVICES GROUP, LLC 3

High Cost Care Center Physical Therapist #1 $88,000 Physical Therapist #2 $88,000 Physical Therapist #3 $88,000 Therapist Assistant $48,000 Total Salary $312,000 Total Cost* $474,240 *(inclusive of Benefit Burden of 52%) What this Means High Cost Care Center Total Cost $474,240/6,587 (Treatment Hours billed) = $72/Hour or $18.00/Unit or $1.20/Minute Efficient Care Center Total Cost $336,400/6,587 (Treatment Hours billed) = $51/Hour or $12.75/Unit or $0.85/Minute 13 15 Efficient Care Center Efficiency Physical Therapist $88,000 Therapist Assistant #1 $48,000 Therapist Assistant #2 $48,000 Therapist Assistant #3 $48,000 Total Salary $232,000 Total Cost* $336,400 *(inclusive of Benefit Burden of 45%) 14 Cost per Unit v. Revenue per Unit What are reasonable #s? Can this be applied to compare in house v. contract? High Productivity and Low Efficiency Medicare Part A resident with 900 minutes Two hour initial evaluation Documentation High Cost Therapy Department Maximize Therapist: Assistant Ratio ZIMMETHEALTHCARE SERVICES GROUP, LLC 4

Limiting Non Billable Tasks Getting Started Morning Meeting Family Meeting Care conferences Screens Completion of MDS assessments Use of non clinical/administrative staff 1. Know your therapy caseload 2. Determine common resident characteristics 3. Group resident diagnostic groups (e.g. postop orthopedic, neurologic, complex medical) 4. Drill down groups (e.g. neurologic with severe impairment vs. neurologic with minimal impairment) 19 Episodic Cost Why is this important? MedPAC Recommendations: Revise PPS immediately Payment for therapy services should be based on patient characteristics (not services provided) Broad reform needed! (Move toward ACOs, Bundled payment, Uniform assessment instrument, single payment system, New Quality Measures & Care Transitions, PAC H readmission penalties) Next Steps After grouping residents characteristics, perform length of stay study to identify the following: 1. Record start date 2. End/discharge date 3. Disposition 4. Average length of treatment session or sum total of treatment units/minutes provided 5. Number of actual treatment days 18 20 ZIMMETHEALTHCARE SERVICES GROUP, LLC 5

Episodic Cost Analysis Calculate Cost/Minute for the entire department All therapist, management and administrative staff costs Calculate Cost/Episode Episodic Cost Efficient Care Center Treatment Days in Episode 24 Average Treatment Time per Day 120 Minutes of Treatment throughout Episode 2880 Cost per minute 0.85 Therapy Cost per Day $102 Therapy Cost per Episode $2,448 21 23 Episodic Cost Implications High Cost Care Center Treatment Days in Episode 24 Average Treatment Time per Day 120 Minutes of Treatment throughout Episode 2880 Cost per minute 1.20 Therapy Cost per Day $144 Therapy Cost per Episode $3,456 Current Admissions Process Managed Care Negotiations Case Management Future Marketing to Acute Care Profitability 22 24 ZIMMETHEALTHCARE SERVICES GROUP, LLC 6

Outcomes Reporting Tracking Performance Monthly, Biannual, or Annual Utilized for: Quality Assurance Hospital Readmission Rate (MI, CHF, Pneumonia) Marketing to Acute Care Hospitals Marketing to Resident/Family Length of stay study 120 100 80 60 40 20 0 Nuero Post op Ortho Medically Complex Severe ADL Medically Complex Minimal ADL Length of Stay Average FIM Improvement Percentage of Residnets D/C Home 25 27 Outcomes Reporting Similar to Episodic Study in structure Added component of ADL functioning ADL status at onset ADL status at discharge Functional Assessment Tools FIMs Part B Severity modifiers CARE Outcomes Reporting Analyze Results Track Improvement/Decline Identify Poor Outcomes Market Good Data 26 28 ZIMMETHEALTHCARE SERVICES GROUP, LLC 7

Conclusion Keep Looking Ahead Focus on Improving Quality and Decreasing Costs Determine Your Cost per Unit/Episode Track and Analyze Outcomes 29 Medicare Part B Therapy 4.9M Medicare beneficiaries utilized in 2011 $5.7 billion in outpatient therapy 37% of total spending billed by SNFs (an increase from 29% in 2004) PT = 2/3 of therapy billed ($4.1B) 2013 Annual Caps on OT / PT+ST ($1,900 each) Exception process continues (KX modifier) $3,700 threshold, then prior auth (auto ADR) NGS: progress reports required at least every five treatment days after limit??? MPPR to 50% reduction to practice expense 31 Avoiding Medicare Part B Coding Losses Recoupment SNFs may not realize they did not receive full reimbursement Examine each claim to verify if full reimbursement was received because more lines may have been disallowed per claim The AVERAGE facility leaves behind ~ $3,000 per month (based on ZHSG audits) Can only go back one year to correct Are you affected? 32 ZIMMETHEALTHCARE SERVICES GROUP, LLC 8

Common Coding Issues CCI edit violations Therapy cap adjustments Incorrect / missing diagnosis code in support of service rendered Timed versus untimed billing issues Overlapping date issues Modifier codes Non reply to ADR letters (30 day limit) Functional Reporting The Law: Section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012 Section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) amended Section 1833(g) of the Social Security Act to require a claims based data collection system for outpatient therapy services, including physical therapy (PT), occupational therapy (OT) and speech language pathology (SLP) services. The system will collect data on beneficiary function during the course of therapy services in order to better understand beneficiary conditions, outcomes, and expenditures. This data will be used in developing an improved payment system. 33 35 Correct Coding Initiative (CCI) January 1, 2006 these edits applied to SNF Part B billing Edits CPT code pairs billed together because either the code pair represents mutually exclusive services or one code is a component of a more comprehensive procedure code Therapeutic Activities (97530) and Gait Training (97116) 59 modifier application Functional Reporting Requires CMS to implement by January 1, 2013: Implemented Functional Reporting with a 6 month testing period January 1 through June 30, 2013 Claims will be returned/rejected without applicable G codes and modifiers for dates of services on and after July 1, 2013 34 36 ZIMMETHEALTHCARE SERVICES GROUP, LLC 9

Functional Reporting Coding Guidelines Required to bill these non payable G codes: At outset of episode (evaluation) Every 10 treatment visits Re evaluation At discharge of episode Modifiers indicate severity of symptoms Therapist should report on only one code set. At each reporting period the therapist will report on 2 codes (either Current/Projected or Projected/Discharge) Code Set Status Current Functional Status Projected Goal Functional Status Discharge Functional Status Documented When? Initial Evaluation End of reporting interval Formal re evaluation Start of subsequent limitation Initial evaluation End of reporting interval Formal re evaluation Start of subsequent limitation Discharge from therapy Discharge from therapy When ending the reporting period of one code set and continuing therapy for a subsequent limitation 37 39 Functional Reporting Severity Modifiers The 6 sets typically reported for PT or OT 4 sets are for categorical functional limitations: Mobility: Walking & Moving Around Changing & Maintaining Body Position Carrying, Moving and Handling Objects Self Care 2 sets are for Other functional limitations: Other PT/OT Primary Other PT/OT Subsequent The 8 sets typically reported for SLP 7 sets are for categorical measures: Swallow Motor Speech Spoken Language Comprehension Spoken Language Expression Attention Memory Voice 1 set is for Other : Other SLP Used to report severity/complexity for the code set 7 point scale using percentage range of limitation which is assessed by the therapist or the result of a standardized test These modifiers are attached to the end of the code set on the bill and are required in all cases 38 40 ZIMMETHEALTHCARE SERVICES GROUP, LLC 10

Severity Modifiers MedPAC s June 2013 Report to Congress Modifier CH CI CJ CK CL CM CN Impairment Limitation Restriction 0 percent impaired, limited or restricted At least 1 percent but less than 20 percent impaired, limited or restricted At least 20 percent but less than 40 percent impaired, limited or restricted At least 40 percent but less than 60 percent impaired, limited or restricted At least 60 percent but less than 80 percent impaired, limited or restricted At least 80 percent but less than 100 percent impaired, limited or restricted 100 percent impaired, limited or restricted Improving Medicare s Payment System for Outpatient Therapy Services (Medicare Part B) 2011: 4.9M beneficiaries (15%) used outpatient Tx SNFs provide 37% of Part B therapy $ (up from 29% in 2004) $ for patients exceeding cap are significantly more ($3,698 v. $576 for those not exceeding) Significant differences among regions Fraud initiatives are working 41 43 Manual Medical Review MedPAC Recommendations October 1, 2012 December 31, 2012 prior approval required after the beneficiary reached $3,700 threshold No preapproval effective January 1, 2013, claims proceed directly to ADR process Pre payment review by the intermediary (MAC) or Recovery Audit Contractor (RAC) 42 Reduce certification period from 90 to 45 days Develop national guidelines for therapy; implement edits that target aberrant providers Reduce caps to $1,270 Implement manual review for requests to exceed cap MPPR to 50% Prohibit use of V codes as the principal diagnosis Collect functional status info using detailed standardized assessment tool to provide the basis for development of an episode based or global payment system Other: Lower payment rates after spending exceeds trigger Increase cost sharing 44 ZIMMETHEALTHCARE SERVICES GROUP, LLC 11

Jimmo Jimmo vs. Sebilus (see ZHSG Alert) settlement re: Medicare coverage of maintenance therapy Coverage based on SKILLED NEED rather than on demonstrated progress CMS will revise manual (expected by 01/14) to state that coverage does not turn on the presence or absence of a beneficiary s potential for improvement from the therapy but rather on the beneficiary s need for skilled care. Implications for CMI may be determined by individual State Medicaid Payment MDS 3.0 Section O definitions OMIG interpretation? 45 ZIMMETHEALTHCARE SERVICES GROUP, LLC 12