Resi esident dent Cl Clas assifica sification tion Syst ystem - - PowerPoint PPT Presentation

ZIMMET HEALTHCARE 2018

Me Medi dicare care Par art t A SN SNF Paym yment ent Syst ystem em Refo eform: m: In Intr troductio

• duction

n to to Resi esident dent Cl Clas assifica sification tion Syst ystem em -I

ZIMMET HEALTHCARE 2018

In Intr troduction

• duction to

to th the e

Resi esident dent Cl Classification assification Syste ystem m - I

Concepts Structure Implications

ZIMMET HEALTHCARE 2018

• IMPACT Act mandated MedPAC to outline a unified payment system

that would replace the four current post-acute care Medicare payment systems (SNF, HHA, IRF, LTCH)

• Objective is to base payment on patient characteristics rather than setting or

amount of therapy furnished (significant redistribution of PAC dollars)

• IMPACT Timeline: Propose system by 2023, then implement
• MedPAC demonstrated that the system is highly feasible & accurate;

recommends implementation in 2021 with 3-year optional phase-in

• See June 2017 MedPAC Report to Congress, chapter 1 for details

RCS S is is NOT OT th the e Unif ifie ied d Post st-Acute Acute Payment yment System stem

ZIMMET HEALTHCARE 2018

Abo bout t RCS CS-I

• Advanced Notice of Proposed Rulemaking (5/4/17; CMS-1686)
• Public comment period extended from 6/26 to 8/25/17 and left open ended
• Based on extensive research and TEPs (possible refinements)
• Target date is October 1, 2018
• Likelihood of implementation?
• Budget Neutrality assumed (Parity adjustments)
• No mention of “phase-in / blend-in” but possibility
• Improvement over RUGs?
• Shift from Volume to Patient Characteristics as $ driver

ZIMMET HEALTHCARE 2018

• NO CHANGE IN MEDICARE “CLINICAL” / “TECHNICAL” ELIGIBILITY REQUIREMENTS
• “Focus on reducing administrative burden for providers”
• MDS remains basis for rate setting, but 5-day sets the “Composite score”

for the entire benefit period (assuming no discharges or sig. changes)

• Remaining PPS MDS schedule is eliminated, including COTOs
• Sets up benchmarking mechanism from admission – discharge
• Recognizes disproportionate costs during first days of stay
• Frequency / Amount of therapy does not impact reimbursement
• Therapy is “just another component of the care plan” – Nursing

acuities, Diagnosis coding & certain Ancillaries drive revenue

Abo bout t RCS CS-I

ZIMMET HEALTHCARE 2018

RCS CS Str tructur cture

• RUG-IV contains 3 rate components:
• Therapy, Nursing (including NTAs) and Overhead
• Blended into one of 66 distinct per diem rates
• RCS includes 5 distinct, (4 variable) rate components:
• PT/OT (30 categories)
• SLP (18 categories)
• Nursing (43 RUGs)
• Non-Therapy Ancillaries (6 levels)
• Overhead / Non-Case Mix Adjusted (1 rate)

Per Diem RUG

O N T

1 of 30 1 of 18 1 of 6 1 of 43 1

Composite

How many possible combinations???

ZIMMET HEALTHCARE 2018

Pos

• ssi

sible ble RCS CS Ra Rate te Co Comb mbin inations ations

PT/OT: 30 SLP: 18 Nursing: 43 NTA: 6 Overhead: 1

139,320

• While there are technically

139,320 possible composite combinations, many are “mutually exclusive”

ZIMMET HEALTHCARE 2018

One step at a time…

Each h co compo mponent nent ha has s its ts own wn grouping ping process cess usi sing ng different fferent variables iables and nd sc scor

• ring

ing me meth thodol

• dologies
• gies

PT/OT • 30 categories SLP

• 18 categories

Nrsng • 43 RUGs NTA

• 6 groups

OH

• 1 CBSA

RCS Composite

RCS: : Wher here e Do W

• We

e Sta tart? t?

ZIMMET HEALTHCARE 2018

Why y is is th the P e Pat atient ient He Here re?

• 10 “Clinical Categories” capture the

“range of general resident types” found in SNFs

• MDS Section I: ICD-10 code
• “Primary reason for SNF stay”
• DRG “Mapping”

Major Joint

• Rep. or Spinal

Surgery Non-Surgical Orthopedic/

Musculoskeletal

Orthopedic Surgery (Except

Major Joint)

Acute Infections

Medical Management

Cancer Pulmonary

Cardiovascular & Coagulations

Acute Neurologic

Non- Orthopedic Surgery

ZIMMET HEALTHCARE 2018

The 10 categories are collapsed into 5 for PT/OT

Medical Management Other Orthopedic

Major Joint

• Rep. or Spinal

Surgery

Acute Neurologic

Non- Orthopedic Surgery

2 for SLP

Acute Neurologic Non- Neurologic

Orthopedic Surgery (Except

Major Joint)

Acute Infections Pulmonary

Cardiovascular & Coagulations Major Joint

• Rep. or Spinal

Surgery Non-Surgical Orthopedic/

Musculoskeletal

Cancer Acute Neurologic

Non- Orthopedic Surgery Medical Management

ZIMMET HEALTHCARE 2018

Major Joint Rep.

• r Spinal Surgery

Other Orthopedic Medical Management Non-Orthopedic Surgery Acute Neurologic

14 – 18 8 – 13 0 – 7

Intact or Mildly Impaired

Moderately or Severely Impaired

Physical ysical / Oc Occupa cupational tional Compo mponent nent Calcu culation lation

Clinical Category (5) Functional Score (3) Cognitive

Impairment (2)

MDS Section Clinical:

I8000 / I0020

Primary reason for SNF stay (ICD-10)

Functional: G

Trans, Eating, Toileting: Self Perf only

Cognitive: C

Cognitive Function Scale

All patients score in one PT/OT group no matter if they receive therapy (or how much)

ZIMMET HEALTHCARE 2018

PT PT/OT /OT Fu Func nction tional al Sco core re

• RCS PT/OT scoring differs from RUG-IV ADL system
• Transfers, Eating and Toileting Self-Performance scores only
• Each ADL scored on a 0 – 6 scale; (v. 4 in RUG-IV)
• 0 – 18 point range
• Unlike RUGs, higher point totals represent lower dependence;
• Fully functional residents are reimbursed at the highest rates
• Greater need reduces PT/OT rate but increases RCS Nursing RUG
• The difference in net impact varies for each component score
• Nursing increase may or may not exceed PT/OT increase
• Any inflexible capture strategy may be counter-productive

ZIMMET HEALTHCARE 2018

ZIMMET HEALTHCARE 2018

RCS: S: P PT/OT OT Fu Functional ctional Score

• re v. RUG-IV

IV: : Self lf-Per erfor formance mance Scale cale

RCS-I I Scoring

• ring

ZIMMET HEALTHCARE 2018

PT PT/OT /OT Ca Case se-Mi Mix x Cl Clas assif sification ication Gr Grou

• ups

ps

See handout for complete listing of case-mix groups

ZIMMET HEALTHCARE 2018

Speec eech h Languag guage e Patholog thology y Component mponent Calculation lculation

Clinical Category (2)

Swallowing Disorder or Mechanically- Altered Diet (3) SLP Related Comorbidity or

• Mod. to Severe

Cog Imp (3)

MDS Section Clinical: I8000 Sw Dis: K0100Z MA Diet: K0510C2 Comorb: Misc. Cognitive: C (CFS)

All patients score in one SLP group no matter if they receive therapy (or how much) Acute Neurologic Non- Neurologic Either Neither Both Either Neither Both

ZIMMET HEALTHCARE 2018

SLP LP Rel elated ated Co Como morb rbidit idities ies

ZIMMET HEALTHCARE 2018

SLP LP Ca Case se-Mix Mix Cl Clas assifi sification cation Gr Grou

• ups

ps

See handout for complete listing of case-mix groups

ZIMMET HEALTHCARE 2018

PT PT/OT /OT & SLP: LP: Co Cogni gniti tive e Fu Func nction tion

• New cognitive measure: Cognitive Function Scale (CFS)
• Combines Brief Interview for Mental Status (BIMS) and

Cognitive Performance Score (CPS) into one scale

Note: Impairment reduces PT/OT but increases SLP component. PT/OT rate reduction exceeds SLP enhancement (almost always).

ZIMMET HEALTHCARE 2018

Nu Nurs rsin ing g Ca Case se-Mix ix Cl Clas assif sificatio ication

• 43 “nursing RUGs”
• RUG-IV Reimbursement drivers, ADL scoring

& splits and hierarchy remain intact

• Minus Rehab RUGs
• Reweighted indices
• 19% HIV/AIDS rate enhancement only applies

to this component

• Triggered by ICD-10 code B20 on the UB-04

See handout for complete listing of case-mix groups and comparison of RUG-IV to RCS CMI weights

ZIMMET HEALTHCARE 2018

NT NTA Gr Grou

• up

p Cl Clas assif sification ication

• Non-Therapy Ancillaries
• Based on the number of services

and conditions

• Hospital look-back as allowed in

RUG-IV

• Greatest rate impact for days 1 - 3

See handout for complete listing of NTA service / condition drivers and related Points

ZIMMET HEALTHCARE 2018

ZIMMET HEALTHCARE 2018

RCS CS Ra Rate te Co Comp mpos

• site

ite Ca Calc lcul ulation ation

• 5-day MDS (ARD 1 – 8) establishes Composite for the entire

benefit period with limited exceptions

• Significant Change / Readmissions
• Each component has a “Base Rate” adjusted by CBSA
• Multiply each Base Rate by respective CMI weight
• “Variable Per Diem Adjustment Factors”
• PT/OT and NTA components decrease as the benefit period

progresses (see handout for detail on Base Rates & VPDA)

ZIMMET HEALTHCARE 2018

Sig igni nifican ficant t Ch Chan ange e Ass ssessm essments ents / Read eadmiss missions ions

• SCSA would change the resident’s RCS-I classification but NOT

reset Variable per diem adjustment schedule

• Interrupted Stay Policy:
• Resident discharged from SNF and returns to same SNF within 3

calendar days: Stay is treated as a “continuation” for purposes of RCS classification and VPDA

• Resident readmitted to the same SNF more than 3 calendar days after

discharge, or in any case where resident is readmitted to a different SNF: Resident receives a new 5-day; RCS and VPDA are reset to Day 1

• PPS Discharge Assessment required (CMS to add items to track

therapy minutes over the course of a resident’s stay)

ZIMMET HEALTHCARE 2018

• Technical & Clinical Eligibility (7 day/week Nursing, 5/Therapy)
• No therapy “levels” to audit – cannot be “excessive”
• “Rationing” therapy (too little?)
• Nursing RUG drivers and “end splits”
• “Lock & Drop” patterns
• ADL scoring
• NTA drivers
• Medical necessity, method of administration, supporting documentation
• Justification for Significant Change assessments
• DRG – ICD-10 assignment (“Mapping”)

Pos

• ssi

sible ble RCS CS Audi dit t Sco cope pe

ZIMMET HEALTHCARE 2018

DRG – ICD-10

DR DRG G Map appi ping ng

• 757 active MS-DRGs in 2017
• Medicare Severity – Diagnosis Related Group:
• The system of clinically classifying a Medicare patient’s hospital

stay into groups in order to set payment

• Diagnoses drive variable RCS components
• Link to MDS: ICD-10 Coding
• Section I: Primary reason for SNF stay
• Secondary & Tertiary codes

ZIMMET HEALTHCARE 2018

RCS CS Ope perati rations

• ns Im

Impl plicatio ications ns

• Admissions decisions
• Profitability profiles change
• Target length of stay
• Billing and corrections; time limitations?
• Financial modeling / revenue projections
• Revenue allocations
• Impact on managed care contracts / rates / APMs
• Hospital-based resurgence?
• Assessment burden – MDS staffing & qualifications
• No margin for error on 5-day
• We need “New Analytics”

ZIMMET HEALTHCARE 2018

The herap rapy y Im Impl plicat ications ions

• No treatment minimums, but ANPRM specifies limits of 25% each

for Concurrent and Group of whatever formal therapy is provided

• No RUG / COTO management
• Department staffing requirements and ratios (% Assistants, Techs)
• Development of therapy-centric programs under the direction of

licensed staff (Activities, Restorative Nursing)

• Alternative modalities (Acupuncture, Therapeutic Massage, Chiropractic)
• Outsource v. In-House management considerations:
• “Pricing” therapy component: no direct link to reimbursement may

incentivize over/under-utilization depending on contract structure

• Reconciling Dx to need, inverse ADL / Cognitive revenue issues

ZIMMET HEALTHCARE 2018

RCS CS Rei eimb mbursem ursement ent Im Impl plicati ications

• ns
• Facility-specific revenue transition analysis:
• Budget neutral redistribution creates “Winners & Losers”
• Comparison to RUG-IV transition projections
• Changes in Provider behavior
• Parity adjustment / Recalibration risk
• Relative values among rate components
• Realizable value of non-therapy payment drivers
• Reimbursement-sensitivity & documentation requirements
• Diagnosis mapping & coding
• Understanding NET revenue impact of ADL & Cognition coding
• Timing of NTA drivers

ZIMMET HEALTHCARE 2018

• Non-medically complex post-knee replacement
• Moderate ADL assistance
• No co-morbidities or NTA services
• 2 hours of therapy per day, 6 days per week
• RUG-IV score = RUB

$730.96

Simplified examples using 2017 NYC rates RCS rate simulator available at zhealthcare.com

ZIMMET HEALTHCARE 2018

• Dialysis
• Moderate ADL assistance
• Wound, IV meds, Transfusion
• 65 minutes of therapy per day, 5x per week
• RUG-IV score = RHB

$491.79

Simplified examples using 2017 NYC rates RCS rate simulator available at zhealthcare.com

ZIMMET HEALTHCARE 2018

• Impact of capturing Respiratory Therapy and Depression

Simplified examples using 2017 NYC rates RCS rate simulator available at zhealthcare.com

Medicare Data Analysis

Market Analysis

238,056

FFS BENEFICIARIES

10,879

SNF USERS

88

SNF PROVIDERS

123.6

• AVG. USERS PER

PROVIDER

4.6%

USERS OF FFS BENEFICIARIES 2,150 1,913 1,875 1,545 1,214 1,191 998 898 852 851 DRG 871 DRG 291 DRG 872 DRG 470 DRG 190 DRG 292 DRG 373 DRG 870 DRG 247 DRG 194

Hospital Medicare Claims Submitted

Facility CBSA Market Saturation and Utilization, by Facility County

26.1% 32.2% 34.9% 25% 27% 29% 31% 33% 35% 37% 2015 2016 2017

Medicare Advantage Penetration

County State Nation

Medicare Data Analysis

Hospital Referral Sources

201 190 75 62 45 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 50 100 150 200 250 Hospital 1 Hospital 2 Hospital 3 Hospital 4 Hospital 5

Hospital Referrals to ABC Care Center

Referrals Medicare Payments

Medicare Data Analysis

SNF Part A Referrals by Hospital

SNF Referrals (#) Referrals (%) ALOS Cost per Admit 5 Star Re-Hosp (%) D/C Community (%) Facility #1 254 17.7% 31.5 $20,349 **** 23.5% 58.2% Facility #2 246 17.2% 33.6 $21,874 *** 18.2% 60.5% Facility #3 201 14.1% 27.1 $17,615 ***** 17.9% 61.4% Facility #4 192 13.4% 28.9 $19,508 ** 22.5% 57.6% Facility #5 150 10.5% 30.2 $19,328 ***** 21.0% 60.1% Facility #6 104 7.3% 34.6 $22,075 *** 20.4% 59.7% Facility #7 88 6.2% 35.7 $23,276 **** 17.7% 57.9% Facility #8 76 5.3% 28.1 $18,518 *** 18.9% 52.2% Facility #9 60 4.2% 30.9 $19,745 * 26.4% 54.5% Facility #10 58 4.1% 36.9 $24,871 *** 23.4% 57.8%

Medicare Data Analysis

Referring Hospital “Pain Points”

1,156 1,058 998 970 901 865 800 798

0% 5% 10% 15% 20% 25% 30% 35% 200 400 600 800 1,000 1,200 1,400 DRG 871 DRG 291 DRG 470 DRG 190 DRG 373 DRG 194 DRG 885 DRG 690

XYZ Hospital

DRG Volume & Re-Hospitalization Rate Medicare Claims Re-Hospitalization

Medicare Data Analysis

Episodic Cost Competitive Analysis

Clinical Category Facility Episodes Facility Episodic Cost Competitor Episodes Competitor Episodic Cost Sepsis 75 $14,987 66 $15,874 Major Joint 68 $8,512 101 $9,254 CHF 64 $11,521 74 $13,654 Stroke 62 $17,085 52 $16,958 UTI 55 $14,954 40 $17,878 AMI 49 $10,098 61 $12,568 Pneumonia 46 $12,545 42 $12,085 Respiratory 41 $13,654 38 $11,097

$0 $3,000 $6,000 $9,000 $12,000 $15,000 $18,000 Sepsis Major Joint CHF Stroke UTI AMI Pneumonia Respiratory

Episodic Cost Comparison

Competitor Episodic Cost Facility Episodic Cost