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Reimbursement: Surviving Prospective Payment as a Recreational Therapist. Chapter 19 HPR 453. Challenges of Healthcare. Increasing challenges and pressures regarding financing services CTRSs must be competent in financial management and accountability of their treatment services

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reimbursement surviving prospective payment as a recreational therapist

Reimbursement: Surviving Prospective Payment as a Recreational Therapist

Chapter 19

HPR 453

challenges of healthcare
Challenges of Healthcare
  • Increasing challenges and pressures regarding financing services
  • CTRSs must be competent in financial management and accountability of their treatment services
  • Demand for validation of tx effectiveness and efficiency is vital as healthcare $$ become more precious
windows of opportunity
Windows of Opportunity
  • RT not included as a rehab service in the Social Security Act
  • In 1990s the language the outdated language was simply updated so access to RT was still limited
  • DRGs in 1994 by American Rehabilitation Association and 1997 Balanced Budget Act prospective payment system (PPS) bundled services for more flexibility
  • Move from provider-based specific to outcome-driven bundling
  • Recognizes offering the most effective mix of tx based on medical judgment of client needs
Medical and rehab services must demonstrate effectiveness and efficiency to be viable under the changes
  • Identification and coding systems have created opportunities for RT
  • 3-hr screening criteria (3-Hour Rule)
  • Partial Hospitalization incremental billing
  • Skilled Nursing (MDS 2.0 then 3.0)
  • Rehab PPS
Measuring value of RT is solely on benefits delivered to patients
  • Must enhance value of services at reasonable cost
  • Labor, resources, technology are primary cost components of any service
  • Lower average salaries under a capitated reimbursement system are a marketing advantage
Durable and nondurable resources are nominal in cost
  • High-touch, low tech caring profession does not routinely rely on expensive technology for facilitating effective outcomes
balanced budget act of 1997
Balanced Budget Act of 1997
  • Goal- Reduce the spending of healthcare $
  • Mandated reduced federal healthcare $
  • Tied payment rates to cost in
    • Skilled nursing
    • Outpatient hospital
    • Home health
    • Comprehensive rehab
    • Specifics on pgs 309-310
overview of prospective payment
Overview of Prospective Payment
  • Payment for med/rehab services at predetermined price calculated prior to service delivery
  • Based on statistically determined price or historical costs
    • Price-based system
    • Rates are set in advance
    • Price is inclusive of all services provided
    • No additional payment or settlement will occur
    • Current year’s actual costs do not impact price established
PPS is based on 4 principles
    • Cost containment – hospitals must closely manage both revenue and costs
    • Quality – safeguards include audits and surveys are 2 methods
    • Access – maintain access to medically necessary healthcare services
    • Beneficiary Centered – based on specific resident needs based on resources used daily (RUGs)
price based vs cost based payment
Price-Based vs. Cost-Based Payment
  • HC facilities no longer establish price for services
  • Now the buyer arbitrarily sets the price
  • A more balanced system is needed for the future
  • PPS comes in 2 different designs
    • Per diem – skilled nursing – how much per day (day to day service cost)
    • Per episode – hospital and rehab – discharge, admission or diagnosis
  • Reimbursement – recovering the costs of resources used
  • Coverage – Identification and inclusion as a tx service within terms of a managed care contract/plan
  • Prospective Payment – payment for tx services at a predetermined price calculated prior to delivery
  • Retrospective payment – cost is submitted after service delivery
Routine service – services required by all patients – predictable and manageable
  • Ancillary services – services specific to patient need – differ in scope, duration, and intensity for each patient
evolution of payment and coverage
Evolution of Payment and Coverage
  • Fee for service
    • Provider controls price – bartering for services in “old days”
    • Boom time for hospitals and healthcare
    • Less frequent today – managed care has replaced to cut costs
  • Implications for RT
    • Manager must understand system to account for every $
    • Tx and services must show outcomes
Examples in RT can be found but vary across the country due to lack of knowledge, misinterpretations of guidelines or resistance to change
  • Discounted Fee for Service
    • Negotiating price-setting process between provider and payer
    • Can be accomplished as identification of a provider and assurance of increased business
Implications for RT
    • Must have fee-for-service system in place
    • RT has traditionally lower direct cost so can maintain a reasonable net margin
    • Using group procedures with reasonable expectation of improving patient’s condition using a group design
    • Example – Aquatic Therapy for a school district
      • # of pts, duration of tx, Frequency of tx, school personnel assistance with pre and post-pool functions, presence of school personnel in pool
Per Diem
    • Daily charge vs. charge per procedure
    • Fee for service is ordering from menu…Per Diem is eating the buffet
  • Implications for RT
    • Increased emphasis on interdisciplinary team
    • Coordination to avoid duplication of services
    • Cost-effective mix of tx services
    • Education for inclusion of RT as covered service is critical for service manager
    • Licensed skilled nursing settings are driven by Medicare and Medicade per diem reimbursement
Capitated Per Diem
    • Under per diem if you couldn’t charge more per day then increase the days
    • Capitated per diem maintains daily charge with limit on number of days
  • Implications for RT
    • Quicker results to move patient to next level of care are valued
  • RT examples
    • Medicare partial hospitalization
    • Long-Term care (100 skilled nursing facility days)
    • If RT is employed in these 2 settings, cost assumed under per diem amount
Prospective Payment of Care
    • Predetermined amount of payment calculated on historical or statistical costs
    • First occurred with DPGs
    • Expanded version of per diem (per day) to per episode (acute care stay or comprehensive rehab discharge)
    • Classifies pts into groups for payment
  • Implications for RT
    • Expanded access for RT because it is bundled care for rehab svcs – RT is a primary rehab svc
Examples of RT Payment
    • Under FPP leadership of ATRA, the profession has received special recognition as a qualified service to satisfy 3-hr rule in comprehensive rehab
    • RT in acute care setting also covered under PPS based on statistical cost for each DPG
  • Prospective Payment for Continuum of Care
    • Next generation of payment – delivered under a larger system or network – Cradle to Grave services
    • Assuring svcs through a continuum
pps application and recreational therapy across the spectrum of care
PPS Application and Recreational Therapy Across the Spectrum of Care
  • Acute Care Hospital Inpatient – per episode DPG payment
  • Inpatient Rehb Facilities (IRF) – per episode payment in case-mix groups made on per discharge basis
  • Partial Hospitalization – RT is one of several “Activity Therapy” svcs – per diem basis
  • Outpatient – RT not covered for outpt Medicare at this time based on outdated Soc Sec language
  • SNFs – RT covered under Medicare Part A – per diem PPS – must be medically necessary and appropriate
strategies for success
Strategies for Success
  • 6 strategies for recognition and coverage
    • Assure Active Tx – 1.)individualized plan of Tx or diagnosis 2.)reasonable expectation to improve condition 3.)be for diagnostic purposes 4.)supervised periodically 5.)evaluated by a physician
    • Specific Physician Orders – Key indicator of medical necessity – scope, intensity and duration
    • Clear distinction between RT and Activities – RT in addition to mandated activity services in LTC – Some RTs provide both but must be distinct regarding the difference
    • Cost Analysis and Accountability – be knowledgeable about cost and revenue – from annual to 15-min or every minute
Staffing and productivity – personnel costs are primary expense – ratio of staff hours to tx volume – can vary based on organization mission, patient acuity, and complexity
  • Compliance with Regulatory Mandates – CMS, JC, CARF – Mgr must be aware of applicable state or local health regulations