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Shifting to Value: PDPM and Changes to Medicare Reimbursement

Shifting to Value: PDPM and Changes to Medicare Reimbursement. Michelle Schmerge, DNP, MSN, ANP-BC, RN. 2. 3. Course Objectives. Learners will be able to define the elements of PDPM and how it changes from PPS.

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Shifting to Value: PDPM and Changes to Medicare Reimbursement

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  1. Shifting to Value: PDPM and Changes to Medicare Reimbursement Michelle Schmerge, DNP, MSN, ANP-BC, RN

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  4. Course Objectives • Learners will be able to define the elements of PDPM and how it changes from PPS. • Learners will be able to discuss how these payment changes will impact the providers practicing in the skilled nursing facilities. • Learners will be able to identify and implement strategies to improve their practice as it relates to the changes in Medicare reimbursement.  

  5. CMS’s Mission…The “Why”

  6. Triad HealthCare NetworkUnderstanding the Impact of System Design On average, other wealthy countries spend about half as much per person on health than the U.S. spends

  7. Triad HealthCare NetworkUnderstanding the Impact of System Design Although the U.S. spends more on healthcare than other developed countries, its outcomes are generally no better Health System Performance Scores – Health Outcomes Source: Schneider et al. “Mirror, Mirror 2017: International Comparison Reflects Flaws and Opportunities for Better U.S. Health Care” http://www.commonwealthfund.org/interactives/2017/july/mirror-mirror/#methodology. Web. 22 April 2018.

  8. The Power of Data, Technology and Analytics on Referrals

  9. What is Driving Healthcare Costs? • How does the US view Social Services? • Employment programs • Supportive housing and rent subsidies • Nutritional support and family assistance • Other social services that exclude health benefits What determines health? *Source: E.H. Bradley and L.A. Taylor, The American Health Care Paradox: Why Spending More is Getting Us Less, Public Affairs, 2013 THN presentation 10-29-18

  10. Evolution of Medicare Payment Models

  11. Statewide trends • Post Acute networks • Shift to value • Focus on readmissions • Total cost of care • Hospital discharge planning rules • Growth in MA plans

  12. What impacts readmissions?

  13. Hospital Readmission Reduction Program: HRRP • Maximum HRRP penalty is 3% • Conditions that are being measured under HRRP • AMI • COPD • Heart Failure • PNA • Aftercare/circ surgery • Aftercare/joint replacements • Hospital readmission penalties in 2019 -- NC – 70 • VA – 64 • TN – 73 • GA - 83 https://khn.org/news/hospital-penalties/

  14. Impact Act • Promote effective communication & coordination of care • Promote effective prevention & treatment of chronic disease • Work with community to promote best practices of healthy living • Make care affordable • Make care safer by reducing harm, cost in the delivery of care • Strengthen person & family engagement as partners in their care Source: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Post-Acute-Care-Quality-Initiatives/IMPACT-Act-of-2014/IMPACT-Act-of-2014-Data-Standardization-and-Cross-Setting-Measures.html

  15. Opportunities • Controlling LOS • Need to improve hospital readmissions • The single SNF VBP metric is tied to “avoidable” hospital readmissions for any cause • Any admission that is not planned is avoidable even if it is for a different condition • Total cost of care

  16. Where are we headed as an industry? • Focus is on getting the patient to the right (and least expensive) care venue at the right time • Better and more focused discharge planning • Establishing follow-up and transition obligations • Hospital >> SNF >> HH >> Physician • Transition care that may be funded by the hospital, Telehealth, PCS and other tools • More sophisticated care at home – “hospital at home” programs, H2H

  17. Patient Driven Payment Model (PDPM) • Lower costs • Improve patient outcomes • Augment revenue sources • Optimize reimbursement

  18. PDPM – Structural Elements

  19. PDPM Clinical Groups • 10 groups • The ICD-10 + the surgical/inpatient category drive the category assignment

  20. PDPM Notes – PT and OT Services • The 10 Clinical Categories are condensed for purposes of PT and OT scoring based on patient function • Both will be affected by the PDPM Variable Per Diem Adjustment (VPDA) Factor which will reduce the payment rate on day 21 by 2% and every 7 days after that by another 2%

  21. PDPM Notes - SLP and Nursing Services • SLP services are weighted based on the clinical group, cognitive function, presence of SLP-related comorbidities and swallowing disorder or mechanically altered diet • Nursing services are classified based on the RUG scoring from the MDS Want to know more? https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/SNFPPS/Downloads/PDPM_Fact_Sheet_Template_Payment

  22. PDGM to PDPM – Common Themes • Both are multi-tiered calculations • Both are intended to focus on patient characteristics (diagnosis & function) rather than services • Therapy volume will no longer influence payment • Nursing becomes a more significant reimbursement driver • Both will significantly alter how providers operate • There will likely be more focus on nursing services and patients with complex needs

  23. Scope of the Opportunity Using NC as an example: • 447 providers in the State • Ranging in Medicare census from 12 to 610 – 4 qtrs ended 9/30/18 • Average LOS ranges from 6 days to 251 days – same 4 qtrs • Hospital 30-day readmission rate – from 2.5% to 32.5% • NC average SNF readmission rate is 19% • 89 of the 447 SNFs have readmit rates higher than 19%

  24. Using Data to Identify the Opportunity SNF #1 • 47 day average length of stay – avg for NC is about 30 days • 25.4% 30-day readmission rate v. State average of 19% • Avg patient age of approx 76 years • Concentration of patients in respiratory and circulatory categories • Downstream utilization

  25. Using Data to Identify Opportunity SNF #2 • Largest source of referrals is the hospital with the third highest readmission penalty in 2019 – a quarter of their DCs to SNF went to this facility • Low average length of SNF stay at 20 days • Hospital readmission rate of 25.7% • This SNF DC’d no patients to HH even though 10% of their DC’d patients ended up in HH within 30 days • Could their readmission rate and the readmission rate of their biggest referral source have been improved with better discharge planning?

  26. PDPM and Providers • Patient acuity matters • Referral sources and relationships • Timely provider documentation

  27. Keys to Success • Impact of Readmissions • Value of Growth & Volume • Acuity drives delivery of care • Documentation and proactive care planning • Care coordination and discharge planning is critical to success • Significance of communityrelationships& resources • Right Care, Right Setting, Right Time

  28. The Future is Consumer Driven Care

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