Are You Ready For PDPM?

Under PDPM, SNFs will need to accurately capture and document patient characteristics, in order to receive optimal reimbursement for the services they provide. Effectively assessing the primary reason for the SNF while still taking into account whether or not surgeries were provided during the hospital stay, appropriately assigning Non-Therapy Ancillaries (NTAs,) and adequately measuring functional performance upon admission and discharge, are all important strategies to master with this new payment system. It is imperative that Skilled Nursing Facilities must have competent Nursing, MDS, Billing, and Therapy staff who embody the expertise and skill set to not only identify all potential avenues that can lead to proper resident classification, but also meticulously document findings for reimbursement and auditing purposes.



Odyssey Rehab; we are performance, data analysis, and documentation experts! By partnering with Odyssey Rehab, we will help you measure your outcomes, showcase your value to existing and future residents, and maximize reimbursement rates, in order to not only provide “better care, healthier people, and smarter spending,” but, also to protect your bottom-line.


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Click on a question below to see the answer.

Answer: Each resident will be placed into a PDPM Clinical Category, using item I8000 of the MDS and Section GG information will be analyzed to obtain a Functional Component Score. In addition, any relevant surgical procedures that occurred during the preceding hospital stay and identified in items J2000-J5000, will also be utilized in calculating the appropriate Clinical Category.


Answer:  These four (4) Clinical Categories are the “collapsed” representation of all PT & OT categories.  There are really 10 different categories for PT & OT.  Here is the breakdown:

  • Major Joint Replacement or Spinal Surgery this is the same in the “collapse list.”
  • Non-Orthopedic Surgery & (3) Acute Neurologic– are collapsed into Non-Orthopedic Surgery & Acute Neurologic.
  • Non-Surgical Orthopedic/Musculoskeletal & (5) Orthopedic Surgery (Except Major Joint Replacement or Spinal Surgery) – are collapsed into Other Orthopedic.
  • Medical Management, (7) Acute Infections, (8) Cancer, (9) Pulmonary, & (10) Cardiovascular & Coagulations– are collapsed into Medical Management.


Answer:  All areas of Section GG submitted for PT & OT Component Function Scores, can be obtained from Therapy input, utilizing the rules set forth by CMS.  These items include: Self-Care (Eating, Oral Hygiene, and Toilet Hygiene) & Mobility (Bed Mobility Items, Sit to stand, Chair/Bed Transfers, Toilet Transfers, & Walking.)  However, Nursing Component Function Scoring includes all areas except Oral Hygiene and Walking.


Answer:  This statement holds true for the Major Joint Replacement or Spinal Surgery category, however, a score of 24 for any other Collapsed Clinical Category Group, will result in LESS reimbursement for the PT & OT Case-mix.  CMS believes that PDPM appropriately assigns payment which reflects a direct correlation between independence and PT/OT utilization; essentially, PT and OT utilization has been found to be “highest for patients with moderate functional independence and lower for patients with both the highest levels of functional dependence and independence.”

Answer:  The 2% reduction factor only applies to PT & OT per diem rates, beginning on day 21, and reduces by an additional 2% every 7 days thereafter; however, the SLP factor remains one (1,) so, there is no reduction in the SLP per diem rate.


Answer:  This statement is INCORRECT, for a number of reasons

  • PDPM does change how patients are classified into payment groups under the SNF PPS, but it does not change any of the coverage criteria or documentation requirements associated with the skilled therapy service coverage under PDPM.
  • CMS clearly states that, “PDPM does not change the care needs of SNF patients, which should be the primary driver of care decisions, including the type, duration, and intensity of skilled therapies, made on behalf of SNF patients.”
  • CMS Federal Register Proposed Rule, further states that “PDPM does not address the specific number of face to face hours that therapists spend with their patients.  The expectation for what is considered skilled therapy and reasonable and necessary care found in Chapter 8 of the Medicare Benefit Policy Manual will not change under PDPM.”
  • Unless you complete an Interim Assessment, or an Interrupted Stay Assessment, you are only required to complete an Admission MDS Assessment prior the Discharge.  This means, in order to capture six (6) days of restorative nursing, you would be required to have your restorative staff start treating each Medicare Part A patient by Day #3 of admission, and continue to provide 6 days/week of treatment for that entire episode of care.


Answer:  This statement is INCORRECT, for a number of reasons

  • CMS Transmittal 88 states that “The frequency or duration of the treatment may not be used alone to determine medical necessity, but they should be considered with other factors such as condition, progress, and treatment type to provide the most effective and efficient means to achieve the patient’s goals.
    • who report moderate to severe pain
    • Rate of successful return to home and community from a short-stay
    • who improved in their ability to move around on their own
  • The Proposed Rule states that “If we discover that the amount of therapy provided to SNF residents does change significantly under the proposed PDPM, if implemented, then we will assess the need for additional policies to ensure that SNF residents continue to receive sufficient and appropriate therapy services consistent with their unique needs and goals.
  • PDPM is designed to be budget neutral, as, the expectation is that services will continue to be provided at the appropriate frequency, intensity, and duration, as defined by CMS and State Practice Act guidelines. 
  • Having the ability to provide up to 25% of therapy services in group combined with concurrent models, the minutes will need tracked to insure we are following this rule effectively. 
  • Therapy Department Directors will still need to review minutes daily, in order to “manage” staffing/caseload coverage appropriately.
  • Lastly, the total minutes by discipline (PT, OT, SLP) and provision (Individual, Concurrent, Group) will be submitted with the Discharge MDS Assessment.


Answer:  An example given in a recently attended webinar, compared two (2) RUB patients; one would have fallen into Acute Neurologic, and the other in Major Joint Replacement, under PDPM.  Both residents would have received reimbursement of $536.42 under RUGIV.  By Day #4 (after NTA factor drops from three (3) to one (1,) the Acute Neurologic patient would equate to $654.23 per day, while the Major Joint Replacement would equate to $635.76 per day. 


Answer:  Just like “overutilization of Ultra High Rehab Categories was a concern under RUG IV,” CMS has developed a “budget neutral” replacement; meaning “underutilization of therapy services for financial gain,” will be also be scrutinized.  Also, keep in mind, SNF PQRS Rules still apply.  The goals of PQRS are to: 1) make care safer, 2) strengthen person and family centered care, 3) promote effective communication and care coordination, 4) promote effective prevention and treatment, 5) promote best practices for healthy living, and 5) make care affordable.  Also, don’t forget that Nursing Home Compare reports on “Short-stay” residents who:

    • were re-hospitalized after a nursing home admission;
    • had an outpatient emergency department visit;
    • got antipsychotic medication for the first time;
    • have pressure ulcers that are new or worsened;
    • report moderate to severe pain;
    • have a successful return to home and community; and
    • improved in their ability to move around on their own.


Answer: PDPM may affect state calculations of the Upper Payment Limit (UPL) and/or changes in NF reimbursement for case-mix states.  CMS is aware that some states use a version of RUG-III or RUGIV to determine payment for NF patients, so, they will continue to report RUG-III and RUG-IV HIPPS codes, based on state requirements, in Item Z0200.  (All scheduled PPS assessments (except the 5-day) and all unscheduled PPS assessments will no longer be available for use, effective October 1st, 2019.) There will be an Optional State Assessment (OSA) that may be required by states for NFs to report changes in patient status, consistent with their case-mix rules.


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