Long Term Care Issues

HFMAHealthcare Financial Management Association

Thursday March 17th 2011Los Angeles, CA

Presenter

Michael Lesnick Ron Wall714-323-5968 909-472-8900MikeL@axiomhc.com RonW@axiomhc.com

Axiom Healthcare Group

Topics

• Medicare RUG IV Categories

• Questionable Billing Practices in SNFs – OIG Report

• A Gaze Into the Future

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RUG-IV Overview

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

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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

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RUG-IV Overview

Implementation Date

• Originally 10-1-2011• Now Payment Under RUG-IV Effective 10-1-2010

With A “Catch”• Starting 10-1-10 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• GREAT NEWS – RUG IV Delay Is Repealed!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

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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• GREAT NEWS – RUG IV Delay Is Repealed!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 2010. 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 2011. All claims processing activities shall proceed in accordance with the existing instructions. (Big Sigh) And to All a Good Night!

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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

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

• Extensive

• Rehabilitation

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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

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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

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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

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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

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Why Is It More Difficult To Get Into REHAB Categories?

• Section T Eliminated

• Counting Minutes Modified

– Concurrent Therapy

– Aide Time

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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)

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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

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Value of Categories Has Shifted

• Essentially Rehab is worth less under RUG-IV and NON-Rehab (Extensive / Medical) Conditions are worth more

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RUG-IV Overview

Impact On Rates / Payments

• Overall Payments to SNFs WERE expected to

be “Budget Neutral”, with a SIGNIFICANT re-shuffling 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.

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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.

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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%)

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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

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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

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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

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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

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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

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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

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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

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Level of Care / “Presumption of Coverage”

Nursing Facility Level-of-Care Criteria

As discussed in § 413.345, 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,

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Level of Care / “Presumption of Coverage”

This designation reflects an administrativepresumption under the 66-group RUG–IV system that beneficiaries who areCORRECTLY ASSIGNED to one of the UPPER 52RUG–IV groups on the initial 5-day,Medicare-required assessment areautomatically classified as meeting theSNF level of care definition up to andincluding the assessment reference dateon the 5-day Medicare requiredassessment

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RUG-IV OverviewRUG-IV Strategies

• 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

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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

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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

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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

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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.

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“Questionable Billing Practices By Skilled Nursing Facilities”

• Released December 2010

• Report # EI-02-09-00202

• Points Out A Variety of Issues The OIG is Concerned About

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“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

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“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.

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A Gaze Into the Future

• Pay For Performance (P4P)

• Accountable Care Organizations / Bundling

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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?

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P4PWhat 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.

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P4PWhy is This Concept Being Promoted?

• To Reduce Cost

• To Stop Undesirable Patterns

• To Promote Desirable Actions (Quality?)

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P4PWhere 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.

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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 §14126.022(i).)

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California P4P PlanQ&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)

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California P4P PlanQ&A Fund

Developing the Payment Model

How Many Dollars Are at Stake?

• For the initial 2011-2012 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

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California P4P Plan

• The Ongoing California State Budget Negotiations Could Change Everything!

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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

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•Q&A

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