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ABCs of PDPM: New Case-Mix Components

Posted by Keith Carson

| speech therapy occupational therapy CMS skilled nursing facilities physical therapy pdpm case-mix components

As you know, the Patient Driven Payment Model (PDPM) is the most significant change in the skilled nursing profession since the arrival of PPS in 1998. There are a number of different aspects to this payment model that can be difficult to digest. I hope to provide you some of the ABCs of this new model that will serve as building blocks to help you understand the key characteristics of PDPM. One of the basic ABCs of PDPM will be the change in case-mix components.

 RUG IV vs. PDPM

RUG IV vs. PDPM_New Approach

Above is a picture of what life is like under RUG-IV vs. PDPM. Under RUG-IV, you have two case-mix categories – nursing (which includes non-therapy ancillary services) and therapy (which includes physical, occupational, and speech therapy). Based on the resident assessment information, the case-mix categories (nursing and rehab) get put into the top of the funnel and out pops a prescribed level which corresponds to a per-diem rate for the facility.  Therapy provides their minutes, nursing works on their ADLs and the facility gets paid a per-diem rate.  In the skilled nursing profession, we have grown accustomed to this model since 1998!

Under PDPM there are five case-mix components: physical therapy (PT), occupational therapy (OT), speech therapy (ST), nursing and non-therapy ancillary (NTA) services. These case-mix components will combine to reflect the patient's characteristics and therefore the amount/type of services that the patient will receive at the facility.  So, when perform the MDS assessments under PDPM, patient A could look very different than patient B. Based on the patient characteristics patient A could require more speech therapy and non-therapy ancillary services while patient B might require more physical therapy and nursing services (see below). You are going to have patients that will receive very different amounts/types of treatment and in turn the facility will receive very different daily per-diem rates for each patient.

RUG IV vs. PDPM

How Much Therapy Should We Provide Our Patients?

The skilled nursing providers we are talking with right now are asking, "How do we know how much therapy to provide our patients?" This is the million dollar question!   CMS has intentionally left this question unanswered.  They want providers to answer this question by looking first at the patient's needs rather than what "level" they should put them at.  I know a number of our clinicians are excited about moving away from minute thresholds and being able to exercise their clinical judgement and discretion to determine how much therapy a patient needs. The initial MDS assessment and the discussions within the IDT will be critical components to determining how much therapy a patient receives.  At Therapy Specialists, we are focused on helping our therapists explain their value within the IDT and justify the therapy a patient might need to be discharged safely and successfully.  In many ways, under PDPM, clinical outcomes will be our compass.  Over time, best practices and treatment patterns will emerge for patients with specific conditions and co-morbidities, and assuming you are achieving the outcomes you want to with those patients, facilities will begin to develop best practices for patients with certain characteristics.

Want to learn more?   For additional information on the role of the IDT under PDPM, please take a look at our video about the evolution of the IDT.

Author Bio:

Keith Carson is often “the first handshake” for Therapy Specialists’ new business partners. Responsible for finding, nurturing and growing strategic partnerships in the market, Keith is the point of contact for facilities considering values-driven contract therapy options. His background in medical and healthcare sales management includes tenures with start-ups and multi-million dollar companies that put him on the frontline with the likes of physical therapists, neurosurgeons and long term care facility managers. He calls on his vast experience and track record to strengthen and grow our business.