Five PDPM pointers and reimbursement opportunities you may have missed

November 13, 2019
Medicare Web

Editor's Note: This article originally appeared in Billing Alert for Long-Term Care (BALTC), a membership benefit of the Association for Medicare Billing and Reimbursement (AMBR). Become an AMBR member today for additional LTC content. 


The Patient-Driven Payment Model (PDPM) has so many nuances that can impact reimbursement that it is near impossible for SNFs to consider and capitalize on them all.

BALTC asked leading experts to share some of the lesser-known payment opportunities and challenges in PDPM. Check your processes and procedures to ensure you’re taking advantage of or protecting against the following aspects of PDPM.   

1: Capture reimbursement for physician utilization review

In RUG-IV and now PDPM, SNFs receive the majority of their payments from Medicare prospectively. However, filing a cost report also leads to reimbursement for a few specific items, including the Medicare utilization review.

“Many SNF providers do not know that if they have a physician who participates in their Medicare utilization review, they can get reimbursed for the Medicare portion of the cost of that,” says Lisa Trundy-Whitten CPA, FHFMA, CPC-A, a principal for the healthcare and not-for-profit practice groups with the accounting firm, BerryDunn.

This is a reimbursement opportunity for SNFs, who may consider involving physicians in the Medicare utilization review meetings once PDPM goes into effect.

“Because reimbursement will be based on clinical characteristics, there will need to be more participation from providers to determine the primary diagnoses and comorbidities for residents,” Trundy-Whitten says.

To ensure correct reimbursement, SNFs will need to ensure that they have documentation that the providers participated in the meetings and a process for ensuring that data pulls over into the cost report.

2. Submit accurate claims when interrupted stays occur

The introduction of the interrupted stay policy (ISP) is one of the biggest changes billers will have to contend with in PDPM, says Rosana Benbow, RN, CCM, CIC, DNS-CT, RAC-CT.

The ISP states that when a SNF discharges and readmits a patient within three consecutive calendar days or less, the SNF should consider the readmission a continuation of the previous Medicare Part A-covered stay, Benbow explains.

“The ISP applies anytime they have a three-day gap in their Medicare coverage. This could be because they're in the hospital, they've changed payers, or even a leave of absence,” Benbow says.

A discharge home for less than three days also meets the interrupted stay criteria. 

Because it is a continuation of the stay, providers resume the assessment schedule and variable per diem schedule from the point just prior to the discharge. SNFs are not required to perform or submit a new 5-day assessment for patients who are subject to the ISP, says Mary Jo Wilson, client engagement specialist and consultant with SNF-Solutions, LLC.

Billing specialists must be aware of and consider the ISP’s requirements when calculating beneficiary days.

“Instead of a one-day skip period, a resident can actually be in the hospital for up to three days and they can bill those days as skip days,” Wilson says.

Additionally, billers need to understand how to submit claims if a patient returns to the SNF in the interruption window and the MDS/RAI coordinator determines that an interim payment assessment (IPA) is needed.

IPAs allow SNFs to capture the clinical conditions associated with the reasons for the patient’s hospital or interrupted stay. The IPA can change all five case mix groups, so the MDS coordinator and billers should evaluate how the IPA will impact the overall daily rate before performing one.

Billers should submit one continued claim with the HCPCS codes generated by the current 5-day assessment. Billers should indicate that the hospital days or interrupted days are non-covered skip days by using revenue codes 0220, 0180, and ZZZZ0. This also requires billers to use span code 74 and dates of service to cover the skip days, Wilson says.

However, keep in mind that the ISP only applies if the resident leaves and returns to the same facility. It does not apply if the resident transfers in from another facility. When the SNF receives a transfer, the clinical team must complete a new 5-day assessment and billers must generate and submit a new claim, Wilson says.

3. Get reimbursed for hospital-administered total parenteral nutrition (TPN)

In PDPM, TPN will impact the non-therapy ancillary (NTA) case-mix component, not just the nursing component which was the only category linked to TPN reimbursement in RUG-IV, says Benbow.

If the resident receives TPN while in the SNF, you will see  higher NTA and nursing scores for that patient. The resident will either meet the criteria for TPN High Intensity or Low Intensity. According to Medicare, use Section K0710A2 to determine the resident’s level. The criteria are:

  • High intensity: If the proportion of total calories the resident received through TPN was 51% or more while a resident
  • Low intensity: If the proportion of total calories the resident received through TPN was 26-50% and average fluid intake per day by IV or tube feeding was 501 cc per day or more while a resident

SNFs will continue to receive reimbursement under the nursing component for TPN administered in the hospital. Section K is a 7-day look back, which can include the hospital stay. Including the TPN in Section K can increase the patient’s nursing score, which can result in a much higher nursing component case-mix grouping and bump the SNF’s reimbursement for these patients.

The 7-day look back is measured by the assessment reference date (ARD) counting back 7 days, including the ARD. At times, it may benefit SNFs to use an earlier day in the stay.

SNFs risk missing out on reimbursement dollars associated with TPN if they do not gather complete documentation from the hospital during the pre-admissions process.

“Because we’re now able to count back from the hospital administration of the TPN, admissions needs to gather that information so that we can set the reference date early enough to capture that hospital TPN,” Benbow says.  

4. Get to know the return to provider (RTP) codes

CMS identifies certain ICD-10-CM codes that will automatically trigger an RTP error if submitted on the MDS or claim. ICD-10-CM codes listed on CMS’s RTP list are not specific enough to map to a PDPM clinical category, so CMS will kick them back for nonpayment, says Maureen McCarthy, RN, BS RAC-MT, QCP-MT, DNS-MT, RAC-MTA, president and CEO of Celtic Consulting.

The RTP list includes many primary diagnoses accepted in the RUG-IV system, including:

  • Muscle weakness
  • Falls
  • Unspecified diagnoses
  • Failure to thrive
  • Dehydration
  • Unsteady gait/Abnormal gait/Difficulty walking
  • Debility
  • General weakness

Including RTP codes on MDSs and claims will cause delays in reimbursement and could ultimately lead to no reimbursement if you admit a patient who does not have a condition that maps to a PDPM clinical category, McCarthy says.

“In RUG-IV, we could cover patients with these conditions by providing therapy to get them to that skilled-level of care. But now, you do not have that safety net. Those diagnoses do not cross over to PDPM. If you have an RTP condition listed as the reason why you’re skilling them, you will not get a case-mix grouping and the patient will not be covered,” McCarthy says.

Consider admission staff as your first line of defense in guarding against patients with RTP conditions as their primary diagnosis. Savvy SNFs will screen for these conditions during the pre-admission process.

“If you have one open bed and three referrals, admission staff should look at the diagnosis codes provided in the admission documentation and compare it to the RTP list. You should choose the patient that you can cover—whose conditions are not on the RTP list,” McCarthy says.

MDS coordinators should also know the codes that will trigger an RTP and avoid including them on the MDS. If the MDS sees an RTP, it may also be a sign that the clinical documentation is not strong enough to support a more accurate and higher-paying code. The MDS coordinator can go back to the clinical team and get a more accurate diagnosis that CMS will reimburse, McCarthy explains. 

Billers are the SNF’s last line of defense. During the triple check, the biller should confirm that the primary diagnosis listed does not appear on the RTP list, McCarthy says.

5. Prepare for a bumpy ride

Business office staff, MDS coordinators, and administration should expect technical issues when they submit MDSs and claims to Medicare or to other payers who have adjusted their systems for PDPM, McCarthy says.

“We saw this in 2010 when we went from MDS 2.0 to MDS 3.0. In some states, we couldn’t even submit MDSs at all. They were being rejected,’ McCarthy says. “There are probably going to be problems, and you’re not just going to be able to push one button and be done.” 

In anticipation of technical problems, do not wait until the last minute to submit MDSs or claims. Give yourself extra time to troubleshoot any issues so that you’re not late in submitting the MDS or claims.

Proper preparation can ward off major cashflow issues for the SNF.

“It can cause huge problems. For example, administrators may need to request interim rate relief because they can’t make payroll because they cannot get their Medicare money,” McCarthy says.

MDS coordinators and billers should also check their software for accuracy during the first several months that PDPM is in effect, says Jennifer LaBay, RN, RAC-MT, RAC-MTA,CRC, a MDS and policy consultant with Triad Health Care.  

“Most of the bigger integrated software systems have a sequencing component or a list of diagnoses managed by the clinical team that carries over to the bill. Double check that information flows over correctly,” LaBay says.

In PDPM, ICD-10 codes take on an entirely new level of importance for reimbursement. The interdisciplinary team (IDT) must ensure that the codes not only accurately reflect the patient’s conditions but are sequenced properly.

Do not assume that the software sequenced the codes properly. The IDT should review and confirm the sequencing during regular Medicare meetings and during the triple check to ensure that the codes are correct, LaBay says.

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Billing and reimbursement