Therapist documenting conversation with patient for Infinity Rehab

January 31, 2019


Skilled nursing is saying goodbye to therapy minutes and welcoming a new payment model. The Patient-Driven Payment Model makes patients the focus of the care plan. This is a major shift away from volume-based services to value-based services designed to depend on the patient’s clinical classification.

This change will take effect October 2019. Here’s what you need to know.

What is PDPM?

PDPM is a new Medicare payment model for skilled nursing communities. This replaces the current Resource Utilization Groups IV (RUG-IV) system, creating a different way of calculating reimbursement.

This change is intended to enhance payment accuracy for therapy, nursing, and non-therapy ancillary services by relying on patient characteristics as the payment dependent rather than therapy minutes.

PDPM creates a case mix based on all factors related to the patient and assigning a score based on that case mix.

The six components used to calculate scores are: nursing, physical therapy (PT), occupational therapy (OT), speech-language pathology (SLP), non-therapy ancillary (NTA), and non-case-mix.

These components add up to a total rate.

With these reimbursement changes, skilled nursing communities must develop methods to: 1) capture the correct diagnoses within eight days of admittance, 2) learn how to investigate the hospital records for potential missing diagnoses, and 3) provide more ICD 10 training.

Here are other major changes with PDPM:

  • Focus on patient characteristics (including diagnosis and function)
  • Therapy minutes are no longer a factor in determining the PDPM level
  • Combined limit of 25 percent on group and concurrent therapy services
  • Two required (and one optional) unscheduled Minimum Data Set (MDS) assessments
  • Over 28,800 payment categories, up from 66 under RUG-IV

Moving forward with excitement

PDPM will help nursing and therapy speak the same language regarding activities of daily living (ADL). This allows the staff to fully capture the resident’s comorbidities for reimbursement.

The Avamere Family of Companies team is excited to embrace the coming PDPM changes through all its challenges and successes.

“We survived MDS 3.0 and the Prospective Payment System,” Avamere Director of Clinical Reimbursement Jeannie Russell said. “We are pros at this now. We will knock PDPM out of the park.”

Visit the American Health Care Association’s PDPM Academy to find out more about PDPM.

Related Posts

Bob Thomas, COO, poses with Avamere award from Portland Business Journal as one of Oregon's Most Admired CompaniesAvamere Family of Companies Recognized as One of Oregon’s Most Admired Companies
Avamere team member serving the homeless at 2019 Project Homeless Connect event in Beaverton, OregonServing the Homeless as a Community