PDGM is Coming in 2020: How to Prepare?

Transcription

1 PDGM is Coming in 2020: How to Prepare? Chris Attaya VP of Product Strategy Home Care Association of New York Senior Financial Managers Retreat September 7,

2 Objectives Understand the latest updates for CMS and the components of the proposed PDGM model Identify the winners and losers and other insights based on data from SHP Share key takeaways to help your agency s prepare for a PDGM-like model 2

3 Understand the latest updates for CMS and the components of the proposed PDGM model 3

4 CY 2018 Proposed Rule July 2017 CMS contracted with Abt Associates to reassess the current HHPPS model and develop an alternative payment model that better aligns patients needs and payments Uses 30-day periods rather than 60-day episodes for payment Eliminates the use of the number of therapy visits in payment determination Relies on clinical characteristics and other patient information in the model Includes Non-Routine Supplies (NRS) in the base rate Proposed to begin January 1, 2019 in a non-budget neutral manner ($950M reduction in payments) 4

5 Industry CMS Negotiations HHGM Rescue Proposal - October 26, 2017 Allow 30 day payment period but maintain 60 day certifications Start January 1, 2020 with rate of $1,772 Extend HH-VBP to all remaining states Industry Letter to CMS December 12, 2017 Principles Budget Neutral; Limit Behavioral change adjustment; Reasonable Reimbursement; Payment on Patient Characteristics and Clinical Needs; Operating Consistently with other aspects of service delivery; Enough Time to implement; and Fully Tested and Validated. Almost Family Proposal Model focuses on patient goals rather than characteristics Technical Expert Panel (TEP) February 1,

6 Behavioral Adjustments (HHGM) LUPAs one visit under the HHGM thresholds FY % of episodes were LUPA 7% of current 60-day episodes receive a LUPA 4.9% of 30-day periods of care are just one visit below thresholds Agencies would provide one additional visit to avoid a LUPA Highest paying Dx code would be listed as Primary Dx Compared changes from DRGs to MS-DRGs IRF PPS first year transition Experience in HH nominal case mix growth No Explicit comment on increasing number of Periods 6

7 Bipartisan Budget Act of 2018 (BiBA) Budget Neutral Transition To A 30-Day Unit Of Payment For Home Health Services 30-DAY UNIT OF SERVICE. For purposes of implementing the prospective payment system with respect to home health units of service furnished during a year beginning with 2020, the Secretary shall apply a 30-day unit of service as the unit of service applied under this paragraph. TREATMENT OF THERAPY THRESHOLDS. For 2020 and subsequent years, the Secretary shall eliminate the use of therapy thresholds (established by the Secretary) in case mix adjustment factors established under clause (i) for calculating payments under the prospective payment system under this subsection IN GENERAL. The Secretary shall annually determine the impact of differences between assumed behavior changes 7

8 CY 2019 Proposed Rule July 2018 Model renamed Patient-Driven Groupings Model (PDGM) Warmed-over version of HHGM Added additional level for Comorbidity adjustment based on the presence of secondary diagnoses Standard Rate and Behavioral assumptions 8

9 Structure of the PDGM 4 x 6 x 3 x 3 = 216 Groups Source: CMS CY 2019 HH Proposed Rule 9

10 Timing of 30-Day Periods The first 30 days would be defined as early and all other subsequent period would be classified as late A 30-day period could not be considered early unless there was a gap of more than 60 days between the end of one period and the start of another Source: CMS CY 2019 HH Proposed Rule 10

11 Admission Source Patients discharged from an institutional setting (acute or post-acute) in the prior 14 days will be defined as institutional and all others as community Second periods with a institutional discharge within 14 days of the SOC would be considered community Source: CMS CY 2019 HH Proposed Rule 11

12 Clinical Groups Based on the Principle Diagnosis on the Home Health Claim Would be the primary reason patient is receiving services under the Medicare home health benefit Source: CMS CY 2018 HH Proposed Rule 12

13 Clinical Groups Questionable Encounters (QE s) were not to referred to. CMS now refers to the list of diagnosis codes that are acceptable in the PDGM Grouping Tool If a 30-day period of care could not be grouped based on the home health reported principal diagnosis, it is expected the claim would be returned to the provider for more accurate or definitive coding Regarding the MMTA category, CMS noted We believe MMTA is not so much an other category as much as it appears to represent the foundation of home health. Source: Table 38: Distribution of resource use of MMTA Subgroups -CMS CY 2019 HH Proposed Rule 13

14 Functional Level Like with the current HHPPS model, PDGM patients would be classified into 1 of 3 functional level based on the following OASIS items: M1800 Grooming M1810 Dress Upper Body M1820 Dress Lower Body M Bathing M1840 Toilet Transferring M1850 Transferring M Ambulation M1033 Risk of Hospitalization Functional Levels based on Points Low, Medium, High 14

15 Functional Level CMS designed to have 1/3 as low, medium and high in each of the Clinical Groups Source: CMS CY 2019 HH Proposed Rule 15

16 Clinical and Functional Groups Source: CMS CY 2019 HH Proposed Rule 16

17 Co-morbidity Adjustment CMS analyzed the presence of comorbidities as another factor that could impact resource utilization and costs Refined the eleven clinically significant subcategories to include interactions of 27 comorbidity subgroups Source: CMS CY 2019 HH Proposed Rule 17

18 Other Key Elements RAPs (Request for Anticipated Payments) and Final Claims billed the same way, but for 30-day Periods CMS soliciting comments on reducing the percentage of the upfront payment incrementally over a period of time Newly enrolled HHAs as of 1/1/19 to be exempt from receiving RAPs PEPs (Partial Episode Payments) and Outliers have the same methodology LUPAs have variable thresholds based on HIPPS code Each HHGM payment group threshold based on 10 th percentile of visits or 2 visits which ever is higher LUPA visits are one less than the threshold listed Thresholds ranges from 2 visits 6 visits 18

19 Financial Impacts of PDGM CMS is providing CCN specific revenue changes under PDGM compared to the current HHPPS on their website Includes assumption of the $1, day rate due to expectation that behavioral factors have occurred Source: CMS CY 2019 HH Proposed Rule 19

20 Financial Impacts of PDGM Nationally the percent of agencies who will see higher revenue under PDGM vs HHPPS is 55.6% (76.4% in the state of New York) Estimate Impact by State range from 28.6% in the Virgin Islands to -11.6% in Idaho (NY is at 6.0%) Limited Data Set (LDS) is available for agencies who request to help address and understand which patients that are impacting the revenue changes Without RAPs, cash flow will be impacted by at least 32 days 20

21 Concerns from NAHC Proposed Comments Cost report data for discipline values is suspect Admission source is a poor substitute for patient characteristics provides incentive to prioritize these patients LUPA thresholds is complicated Behavioral adjustments (BA) should be applied after impact has been studied with supporting evidence BA should only include changes related to PDGM only 21

22 Identify the winners and losers and other insights based on data from SHP 22

23 SHP Data Analysis CY 2017 SHP National Database All Medicare Traditional Episodes ending in CY 2017 with a corresponding Medicare claim (August 8, 2018) HHGM Grouper model was used with a correction Total Episode Count 3,657, ,294 Questionable Diagnoses (17.1%) 7,199 Unknown Diagnoses (.1%) HHGM Period #1 2,553,662 HHGM Period #2 1,895,908 Revenue assumptions based on CY 2017 National Rates for HHPPS HHRGs (inc. Non-Routine Supplies) compared to the CY2018 Proposed Rule HHGM Group Model with estimated budget neutral rate of $1,772 (no Area Wage assumptions) 23

24 HHGM Components by CMS region Clinical Group NY 53.0% 24

25 HHGM Components by CMS region Functional Level NY 46.1% NY 20.9% 25

26 HHGM Components by CMS region Admission Source (Period 1) NY 37.7% 26

27 HHGM Components by CMS region Timing of the Episode NY 53.4% 27

28 LUPA data across CMS Regions LUPA Percent of Periods highest in the Northeast 28

29 LUPA data across HHGM Clinical Categories LUPA averaged 8.2% across all periods 29

30 Visits per Period Reflects the higher resource use in the first Period Likely to see visits changing due to therapy incentive changes 30

31 Supply Costs Built into the case mix weight of each PDGM group CMS has estimated that 60% of the CY 2017 did not contain Non-routine Supplies (NRS) Wounds have higher non-routine supply cost per new Clinical Groupings 31

32 HHGM Revenue Compared to HHRG Based on Standard PPS Episodes (excluding LUPA, PEP, Outliers) 32

33 HHGM Revenue Compared to HHRG 33

34 HHGM Revenue Compared to HHRG 34

35 Top 25 ICD-10 Primary Dx Codes 35

36 Top 25 ICD-10 Primary Dx Codes 36

37 Comparison of Top Diagnosis Codes Top Diagnosis codes in each HHGM Clinical Group HHGM Revenue is lower in 3 of the 6 Groups Variance is significant compared to national PPS rates are reimbursed today 37

38 Questionable Encounters (QE) SHP National Average was 17.1% 38

39 Top 20 QEs by ICD-10 Code Begin to address codes that would be questionable 39

40 Lengths of Stay (LOS) by Region Shows Percent of Episodes across 1-15 days, days and at 60 days 40

41 Share key takeaways to help your agency s prepare for a PDGM-like model 41

42 Evaluate your Agency s PDGM Impact PDGM has been designed based on National Resource Use Model the revenue changes between todays HHPPS and PDGM using the 80/20 rule Groupings Tool - Type/Home-Health-Agency-HHA-Center.html Consider the Marketing Impacts Competition for patients from institutions may increase LEAN look at your costs/efficiencies What is your value proposition Managing LUPAs with the different thresholds 42

43 Coding Accuracy Determining correct primary Diagnosis Coding Determining secondary Dx and impact on the co-morbidity adjustment Avoiding Questionable Encounters (QEs) OASIS Accuracy is crucial for: Functional Levels that impact resource use Quality Outcomes 43

44 Therapy as a Cost vs Revenue Driver Use of therapy assistants Use of rehab aides Use of tele rehab Utilize centralized therapist to make recommendations Observation of functional status via webcam Therapist can cover many more patients without travel What is right amount of therapy to produce results? Efficient and Effective plans of care 44

45 Evaluate Length of Stay (LOS) Considerations Are the visits performed in the 2nd 30 days giving you positive results? Avoid confusion between Payment Model vs Care Model Avoid discharging too early Will need to continue to determine plan of care and interventions over 60 days Discharge to Community - PAC Medicare Spending per Beneficiary (MSPB) - PAC Potentially Preventable 30-Day Post-Discharge Readmissions 45

46 Questions? 46