Medicare: Survive Today And Prepare For Tomorrow

1. Medicare:Survive Today And Prepare For Tomorrow Monday October 11, 2010

2. Today and Tomorrow Is All About Health Care Reform Elise Smith Vice President, Finance Policy American Health Care Association

3. Health Care Reform Balancing Act

4. Cost Containment Strategy • Direct -- Continue to Address and Improve Current Methodologies • PPACA holds down increases in adjustments to provider payments in all categories • Silo coverage and payment methodologies will continue as long as they must • Future quality measurement will build on silo quality measurement • Indirect -- Improve medical care delivery and improve health outcomes through: • Development of new care delivery systems. E.g. bundling, accountable care organizations etc. • Integration • Co-coordination • Co-operation

5. The A Team! • Peter Gruhn -- RUG-IV: Selected Issues and Opportunities • Joy Morrow -- MDS 3.0 and Operational Issues • Pat Newberry -- Operationalizing MDS 3.0 and RUG-IV • Peter Gruhn -- What’s Ahead For SNF Reimbursement • Bill Ulrich -- Critical Current Billing Issues and More • Jill Mendlen -- The Future!

6. RUG-IV:Selected Issues and Opportunities Peter Gruhn Director of Research American Health Care Association

7. RUG-IV: Realizing Opportunities • The New RUG-IV: But Don’t Forget HR-III • RUG-IV: Selected Issues and Opportunities • Operationalizing MDS 3.0 and RUG-IV: Realizing Opportunities

8. The New RUG-IV • Under RUG-IV, CMS will modify the eight levels of the RUG hierarchy and increase the number of case-mix groups from 53 to 66 in order to better distinguish between relative resource use both within and between RUG groups • CMS believes that the new RUG-IV system will be more sensitive to differences in patient complexity and the SNF resources needed to provide quality care • CMS believes that RUG-IV better targets payments to beneficiaries with greater needs • Improved accuracy of Medicare payments • Access to high quality SNF care will be maintained and enhanced

9. The New RUG-IV • RUG-IV will be implemented in a budget neutral manner • While budget neutral, RUG-IV will significantly affect the distribution of payments across a significantly regrouped and modified RUG-66 grouper • However…

10. …But Don’t Forget About HR-III • FY 2010 Final Rule: • MDS 3.0 and RUG-IV implementation on Oct 1, 2010 • Patient Protection Affordable Care Act (ACA): • Mandated implementation of MDS 3.0 for FY 2011 • 1 year delay in implementation of RUG-IV FY 2012 • Implementation of selected RUG-IV elements as originally set for FY 2011 (concurrent therapy and look-back changes)

11. RUG-IV versus HR-III • Issues: • RUG-IV designed to be implemented with MDS 3.0 • RUG-III incompatible with MDS 3.0 • Need to modify RUG-III and develop grouper to utilize MDS 3.0 to include RUG-IV elements • Hybrid RUG-III (HR-III) PPS and grouper will not be ready for implementation on Oct 1, 2010

12. RUG-IV versus Hybrid RUG-III • Response: • CMS plans to apply interim payment rates based on MDS 3.0 and RUG-IV effective Oct 1, 2010 • This way providers can be paid • Once the necessary infrastructure is in place, CMS will retroactively adjust the rates to reflect HR-III • SNF may need to resubmit claims using HR-III grouper • HR-III will also be implemented in a budget neutral manner • Legislation is pending in Congress to repeal HR-III, and proceed with implementation of RUG-IV as specified in last year’s final rule

13. RUG-IV: Selected Issues and Opportunities • RUG-III/RUG-IV: Changes in Distribution • Payment Rate Changes: Issues and Opportunities • Therapy Contracting: Issues to Consider • Assessment Window Pitfalls

14. RUG-IV: Issues and Opportunities: Changes in RUG Grouping/Distribution

15. RUG-IV: Issues and Opportunities:Changes in RUG Grouping/Distribution • RUG-III to RUG-IV: Factors • Concurrent therapy adjustment • Pre-admission lookback • ADL scale and scoring • Recategorization • Other (No Section T, SOT OMRAs, Short stay policy) • RUG-III to HR-III: Factors • Concurrent therapy adjustment • Pre-admission lookback • Resource: AHCA Medicare RUG-IV Rate Calculator

16. RUG-IV: Issues and Opportunities:RUG-IV & (Urban) Payment Rates

17. RUG-IV: Issues and Opportunities:The Lookback Effect & (Urban) Payment Rates:The Lookback Effect

18. RUG-IV: Issues and Opportunities:Concurrent Therapy & (Urban) Payment Rates:

19. RUG-IV: Issues and Opportunities:Concurrent Therapy & (Urban) Payment Rates: ?

20. RUG-IV: Issues and Opportunities: The Lookback Effect & (Urban) Payment Rates

21. Reimbursement Issues and Opportunities: The Lookback Effect & (Urban) Payment Rates:Extensive Services Qualifier Effect: IV Feeding

22. Reimbursement Issues and Opportunities: The Lookback Effect & (Urban) Payment Rates:Extensive Services Qualifier Effect: IV Meds

23. Therapy Contracting: Issues To Consider

24. Assessment Window Alert • Resident Therapy Delivery and the Assessment Window • CMS’s concern: • MDS does not accurately reflect the services needed by and provided to the resident • CMS’s guidance: • “Therapy definitions and limitations must be applied consistently whether or not the resident is in the assessment window” • “The therapy mode definitions must always be followed and apply regardless of when the therapy is provided in relationship to all assessment windows (i.e. applies whether or not the resident is in a look back period for an MDS assessment)”

25. Assessment Window Alert • Issues: • Possible inconsistency in therapy service delivery between the MDS and medical record • Invites medical review by MACs, RACs, surveyors • Would there be overpayment recovery and sanctions?

26. MDS 3.0 and Operational Issues Joy Morrow, RN, PhD Senior Clinical Consultant Hansen, Hunter, & Co., PC

27. How long it takes to do MDS 3.0 • We believe published information is inaccurate • From our in the field practice the process is longer • BUT 3.0 is better • Nurses like the relevance • Residents like it • Families like it • I felt that I really knew the resident

28. Residents Must Be Interviewed • Most residents will be able to be interviewed • Do not inaccurately presume that resident cannot be interviewed without a professional attempt • This compliance issue will be surveyed

29. Presumption of Coverage • The original material from Baltimore sounded as if presumption of coverage was gone • Not true – we still have the presumption with physician order for skilled service that resident is skilled until day 8 of skilled stay or ARD of 5-day assessment whichever occurs first

30. Hospital Observation Issues • Lack of 3 day qualifying stay • SNFs have difficulty discerning observation vs. inpatient • Elderly are often not ready to be discharged home and… • They are not eligible for SNF Part A • Hospitals not always forthcoming with correct information re: observation stays

31. Most Beneficiaries Who Have Met Qualifying Hospital Stay Criteria • Meet the criteria for skilled care • Administrative criteria – complexity of non-skilled conditions… • Safety and stability… • Need for skilled professional nursing care • RUG IV qualifiers • Skilled nursing facility that provides some rehab • “Rehab facility” that rarely provides skilled nursing

32. Look Back • The questions that include look backs longer than admission forward are for information and care planning and overall clinical care • They are not for reimbursement related to services prior to the SNF admission • Most look backs are 7 days unless designated otherwise • The top nine RUG categories will likely have far fewer days

33. Extensive Services • Since admission – trach and vent care • Isolation for active infective respiratory infection • ADL score 2 or more • Alone or combined with Rehab – not too likely in most of our facilities

34. Setting the ARD • MDS nurse must know the facility payment rates • Some nursing categories have better payment than therapy categories • All patient/residents do not need therapy • Enhance your skilled clinical nursing services

35. Skilled Nursing • Staff nurses must understand the clinical services that they provide • Accurate clinically appropriate documentation is a must • Skilled prompts & check list programs are helpful IF the nurse is using clinical thinking while documenting

36. Critical Clinical Thinking • What services am I providing that require skilled professional knowledge? • What are the immediate health and safety needs of this patient/resident? • What are the co-morbidities that I must consider and monitor? • Does my documentation reflect these professional considerations?

37. Default Payment Exceptions • Remain in effect for allowed circumstances: • Resident discharged during 1st 8 days • Late assessment – default up to ARD

38. More Assessments – Quite a Few More • Some assessments will require sophisticated thinking to ensure appropriate reimbursement • Combined assessments will need careful thought • Split RUG assessments

39. Start of Therapy (SOT) OMRA • Optional (even though called “required”) • May be needed to get appropriate reimbursement • Is used to qualify resident for rehab RUG • MDS will be rejected if the MDS does not calculate to rehab category

40. SOT Details (cont.) • Facility clinical management needs to manage types of MDSs and communicate with therapy • The SOT assessment is shorter assessment • Payment starts on first therapy day even when only one therapy is starting

41. End of Therapy OMRA • Required – establishes non-therapy RUG when therapies are discontinued • But skilled care continues. • ARD must be set 1-3 days after all therapies dc’d • Payment is adjusted to non-therapy • Which ARD you pick will NOT affect payment • Payment changes as of last day of therapy

42. Short Stay Policy • Therapy is pro-rated based on average daily therapy minutes actually provided • Therapy minutes are divided between the days that treatment minutes were provided • Treatment minutes must still meet the 15 minutes per day requirement

43. Short Stay Policy Includes 8 Requirements for the Start of Therapy MDS • It requires a competent MDS nurse who considers the RUG categories • Assesses the payment for each category • Short stay policy may work best for stays that are only 4 days or less • Latest news from 3.0 facility practice…

44. Biggest Decision For CEO/DON • Do I have the right person in the right job? • Is each MDS nurse competent – exhibiting critical clinical thinking? • Is he/she willing to embrace the culture change and really interview and examine each resident? • Is each MDS nurse able to examine and interpret RUG rates considering resident needs and appropriate reimbursement? • Does facility need to reassign some roles/tasks?

45. CEO/DON Must Understand • Complexity of 3.0 • Transition time needed • Importance of performing job correctly • Correct number of MDS nurses • Difference between Medicare MDSs and non-Medicare MDSs • Considerations for case-mix states

46. Always Have Manual Open • Use the RAI manual with every MDS • Read the instructions • Read the MDS form instructions • Have a facility policy/guideline that requires MDS nurses to use the RAI manual

47. Concerns • Since the SOT OMRA is optional, nurses may tend to not do them • We believe that more often than not this will be detrimental to facility reimbursement • It is essential that you learn how to combine the SOT OMRAs with the regularly scheduled PPS assessments

48. The New Interviews Are Validated • They are excellent tools • You may need to look at competency of staff to decide who should perform these specific interviews. • MSW vs. RN vs. well-trained social worker with B.S. degree, etc. • Do not rush resident to answer – let them process the question – allow at least 30 seconds

49. Changes to ADL Scoring • Must we verify 3 occurrences? • If so, how should this be done? • Will more effort be required re: ADLs and documentation? • (Rule of 3 does not apply to bathing)

50. ADL Documentation • ADL flow sheets ??? • Computer programs – very good but training and review are needed • Interviews with direct care givers including documentation of interview is very good • Daily Part A documentation sheet with limited important prompts might be a good tool