PDGM: Revenue Cycle Management Changes

9/30/2019

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PDGM: Revenue Cycle Management Changes Presenters: Melinda A. Gaboury, COS-C

M. Aaron Little, CPA

TABLE OF CONTENTS

• Define Revenue Cycle Under PDGM

• Intake/Orders/Billing

• Scenarios Specific to Revenue Cycle

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432 payment groups – increased from 216 groups originally proposed

Episode timing: “early” or “late”

Admission source: Community or Institutional

Clinical grouping: 12 sub-groups (primary diagnosis)

Functional level: 3 groups – Low, Medium or High

Comorbidity adjustment: None, Low or High (secondary diagnoses)

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Patient-Driven Groupings Model (PDGM)

PDGM makes no changes to the 60-day clinical episode certification

– SOC/Recert (Follow-Up)

– 60-day Plan of Care

– Recertification visit within the last 5 days prior to the beginning of the Recertification Episode

– Face to Face Requirements remain

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Patient-Driven Groupings Model (PDGM)

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Patient-Driven Groupings Model

(PDGM)

Revenue Cycle – SOC & Recert

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PDGM billing – Ongoing

30-Day Payment Periods

INTAKE/ADMISSION

What will Intake need to collect during referral process:1. Referral Order2. Face to Face Encounter Note – or evidence to support if a F2F has been done3. History & Physical – Discharge Summary or any other documentation that will 

contain support for physician issued diagnosis coding – this documentation will also assist in supporting skilled need for home health and homebound status for certification 

4. Documentation surrounding any facility ADMISSIONS/DISCHARGES to help determine if the patient’s episode will be Community or Institutional – making sure to know the specific facility type due to differing codes for the home health claim

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INTAKE/ADMISSION

What will Intake need to collect during referral process:5. Medicare Eligibility Verification – to establish eligibility for the home health 

benefit and to determine if the patient has been in a home health episode that ended less than 60‐days ago – EARLY vs. LATE – reverification at recertification if early in the calendar year to ensure that Medicare Advantage is not in the mix

6. Establish the physician that will be following the patient in home health and confirm that the physician has agreed to follow and certify the patient for home health

Orders Management

• Timely signed orders will be critical to cash flow

• Order management must be treated with urgency, as if it were a new thing and we are forced to make it happen

• Assign someone the specific task in their job description and ensure that timelines established for follow-up and resending of orders is followed.

• Use the tools you have to the fullest – MOST EMRs have a physician order tracking mechanism that many don’t realized exists

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• Not all physicians are the same…understand what each requires in order to get orders back timely.

• Know who is responsible in each office and hold them accountable

• Example timeline:– Day 7 resend orders– Day 12 call to physician office– Day 15 escalate to clinical or manager– Day 20 liaison visit to office

Orders Management

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Billing/Collections

• RAP beginning of every 30 day payment period

• Final end of every 30 day payment period

• Remittance Advise Issued – Cash Posting Occurs

• Reconciliation between what you are paid and what EMR

calculated that you would get paid

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Request for Anticipated Payment (RAP)

• Required for each 30-day payment period

• Proposed 07/2019 to be Paid at 20% INSTEAD of– Paid 60/40 split payment for SOC periods

– Paid 50/50 split payment for all other periods

– No payment for HHAs Medicare certified in 2019 or thereafter

• 2019 certified HHAs required to submit “no-pay” RAPs

• RAPs to potentially be phased out

– RAPs PROPOSED July 2019 to be replaced by a Notice of Admission effective January 1, 2021

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RAPs

• Prior to billing the 1st 30-day RAP – first billable visit must be completed, OASIS locked and POC completed and sent to physician.

• 2nd 30-day RAP – first billable visit must be completed. (POC is already done & OASIS unless there is an Other Follow-up or Resumption to use.)

• The percentage payment for the RAP is based on the HIPPS code as submitted. Upon receipt of the corresponding claim, grouping to determine the HIPPS code used for final payment of the period of care will occur in Medicare systems.

• Subject to auto-cancellation & payment recoupment by MAC when corresponding claim is not successfully received timely

– 60 days from end date of 30-day payment period, or– 60 days from date RAP is paid, whichever date is greater

• Must be in “paid” status before final claim can be billed & paid15

• RAPs PROPOSED July 2019 to be replaced by a Notice of Admission (NOA) effective January 1, 2021

– NOA would be filed upon admission of the patient to home health…it must be filed and ACCEPTED at the MAC within 5 days of the SOC date.

– If it is not accepted within 5 days the agency will be penalized for every day up until it is accepted at the MAC

• Estimated HIPPS amount divided by 30 for a daily amount and the daily amount multiplied by the number of allowable days based on the accepted date.

RAPs

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Final Claims

• Required for each 30-day payment period

– No sequential billing (being tested for future implementation)

• Required to have corresponding RAP in “paid” status

– Paid full claim amount - Less recoupment of RAP payment (80%)

• Subject to payment pricing & adjustments, if applicable

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Billing requirements

– All payment periods

• OASIS assessment(s) transmitted to & accepted at ASAP

– SOC, recertification, ROC or other follow-up, if applicable

• Compliant F2F encounter documentation obtained

• All physician orders signed & dated

– POC & all other interim orders applicable to payment period

• All billable visit & NRS documentation completed

• Compliant therapy reassessment documentation completed

Final Claims

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• Some data required on a PPS Final claims will be tweaked for PDGM:– 18-digit Treatment Authorization Code/OASIS Matching Key will

NO Longer exist under PDGM– Occurrence Code 50 will be entered on the Final claims with

the Occurrence Date equal to the date the assessment is completed from M0090 of the OASIS that your system used to create the HIPPS

• It is IMPERATIVE that this date is correct…..this is how the system will confirm the OASIS to be used for the Functional Scoring

Final Claims

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• Occurrence Codes 61 & 62 will be utilized on 1st (initial) 30-day payment period Finals to signify that the patient is an Institutional patient status:

– Occurrence Code 61 – with the date of the ACUTE HOSPITAL discharge date that was within 14 days prior to the HHA start date

– Occurrence Code 62 – with the date of the SNF, IRF, LTCH or IPF discharge date that was within 14 days prior to the HHA start date

• Occurrence Code 61 will be used on 2nd 30-day payment period Finals to signify that the patient is an Institutional patient status:

– Occurrence Code 61 – with the date of the ACUTE HOSPITAL discharge date that was within 14 days prior to the HHA begin date of the current 30-day period

Final Claims

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Claim payments subject to pricing

– OASIS Validation is the first step – the Claim will RTP if the OASIS data and the claim do not match.

– Payment period timing

• Claim payments to be automatically repriced for early or late status based on paid claims history on Medicare CWF (Start of Care ONLY)

– Admission source

• Occurrence codes 61 & 62 will now be used to trigger payment calculation for Institutional vs. Community. Claims data will be utilized to reconcile periodically with the Institutional credit given.

Payment Pricing

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Payment Pricing

Claim payments subject to pricing

– Clinical Grouping & Comorbidities

• The primary & all secondary diagnoses are taken from the CLAIM to determine the Clinical Grouping and Comorbidity level.

– Functional Scores

• OASIS Responses will be extracted from the OASIS-D1 and used to calculate the HIPPS code

• The final HIPPS code calculated by the Medicare MAC is the one that your final claim payment will be based on regardless of the HIPPS code that you sent in on the claim.

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• Applies to three intervening events occurring during a 30-day payment period: Beneficiary elected transfer to another agency - Discharge from your agency & subsequent readmission to your agency or another HH - Change from traditional Medicare to Medicare Advantage plan

• Claim payment prorated based on first & last billable visit dates during 30-day payment period

Partial Episode Payment Adjustment (PEP)

• Applies to high cost 30-day payment periods based on time spent in home during visits – units reported on the claim

• Calculation unchanged from PPS except that the FDL ratio will be 0.63 - applied to 30-day period

Outlier

LUPA Thresholds

Variable thresholds based on Case Mix Grouping

– Different level for each of the 432 Case Mix Groupings – ranges between 2 - 6 visits.

– Based on 30 day payment periods – NOT 60 day episodes

– Utilize 10th percentile value of visits for each threshold

– LUPA reimbursement is per visit (as prior PPS)

LUPA add-on

– Applies only to SOC 30-day payment periods with total visits at or below LUPA visit threshold

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Case Mix Weights -

LUPA

Admission Source & Timing

Clinical Group & Level

Comorbidity Adjustment

HIPPS Code Weight

LUPA Threshold

Early ‐ CommunityMMTA ‐ Other ‐Low 0 1AA11 1.0062 4

Early ‐ CommunityMMTA ‐ Other ‐Low 1 1AA21 1.0662 4

Early ‐ CommunityMMTA ‐ Other ‐Low 2 1AA31 1.1957 4

Early ‐ CommunityMMTA ‐ Other ‐Medium 0 1AB11 1.1456 5

Early ‐ CommunityMMTA ‐ Other ‐Medium 1 1AB21 1.2056 5

Early ‐ CommunityMMTA ‐ Other ‐Medium 2 1AB31 1.3351 5

Early ‐ CommunityMMTA ‐ Other ‐High 0 1AC11 1.2701 5

Early ‐ CommunityMMTA ‐ Other ‐High 1 1AC21 1.3302 5

Early ‐ CommunityMMTA ‐ Other ‐High 2 1AC31 1.4597 5

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LUPA Example:

Patient admitted to home health on 02/01/20 – no previous home health episodes. Patient discharged from Acute Hospital on 01/31/20. Patient has a primary diagnosis of Diabetes E11.9 and no comorbidities that group, medium Functional score.

HIPPS CODE: 1st 30-days: 2AB11

• Timing – Early

• Admission Source – Institutional

• Clinical Grouping – MMTA-Other

• Functional – Medium

• Comorbidity - NONE

• Case-Mix Weight – 1.3222

• LUPA THRESHOLD - - 5

HIPPS CODE: 2nd 30-days: 3AB11• Timing – Late• Admission Source – Community• Clinical Grouping – MMTA-

Other• Functional – Medium• Comorbidity - NONE• Case-Mix Weight – 0.7355• LUPA THRESHOLD - - 2

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How would these events be captured in EMR & mapped to claims for billing 

& payment purposes?

What system settings in your EMR are you responsible for adjusting to capture these 

events?

How would these events be 

documented in your EMR?

How would these events occur within the 

workflow of your everyday 

operations?

Revenue Cycle Preparation

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Revenue Cycle Preparation

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Assess data capture process at intake/SOC

Assess data capture at each 30‐day 

payment period/recertification

Assess pre‐billing process controls

Test & monitor claim & payment scenarios

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Scenario 1 – Payment Rates

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Scenario

Episode begins 12/02/19

Episode ends 01/30/20

Episode pays based on proposed 2020 transition PPS rate

$3,221 proposednational standard rate per 60‐day episode

Scenario 2 – Payment Rates

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Scenario

Episode begins 01/01/20

Episode ends 02/29/20

Episode pays based on proposed 2020 PDGM rate

$1,792 proposednational standard rate per 30‐day period

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Scenario 3 – Admission Source

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Scenario

Patient admitted to HH 01/01/20 with no prior inpatient stays

Patient admitted to emergency room 01/28/20

Patient discharged home from observation stay 01/29/20

Observation stays not qualified as institutional

Payment period 01/01/20 grouped as community

Payment period 01/31/20 grouped as community

Scenario 4 – Admission Source

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Scenario

Patient admitted to HH 01/01/20 with no prior inpatient stays

Patient admitted to hospital 01/20/20 & discharged to SNF 01/23/20

Patient returns to HH 01/30/20 after discharge from SNF 01/28/20

Payment period 01/01/20 grouped as community

HH discharged as of 01/23/20 due to SNF admission

Payment period 01/30/20 grouped as institutional

Report occurrence code “62” with date 01/28/20

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Scenario 5 – Admission Timing

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Scenario

Patient admitted to HH 11/17/19 with MA plan as primary

Patient reverts to original Medicare as primary effective 01/01/20

Patient returns to HH 01/30/20 after discharge from SNF 01/28/20

Prior HH services covered under MA are not considered

Payment period 01/01/20 grouped as early

Scenario 6 – Admission Timing

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Scenario

Patient admitted to HH 11/17/19 with Aetna plan as primary & Medicare secondary

Amount unpaid by Aetna billed to Medicare as a MSP claim

Patient reverts to original Medicare as primary effective 01/01/20

Prior HH services paid as MSP are considered

Payment period 01/01/20 grouped as late

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Scenario 7 – Clinical Grouping

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Clinical grouping for payment period 01/01/20 is Wounds

Shift in focus of care was due to unexpected significant change in condition

Clinical grouping for payment period 01/31/20 is MMTA –Cardiac/Circulatory

Scenario

Patient admitted to HH 01/01/20 with wound care as primary focus of care

Patient admitted to hospital 01/24/20 due to unexpected cardiac event

HH care resumed 01/27/20 with care primarily focused on cardiac condition

Scenario 8 – Clinical Grouping

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RAP coded with HIPPS code & primary diagnosis indicating wound care billed & paid

RAP coded with HIPPS code & primary diagnosis indicating wound care canceled

Corrected RAP coded with HIPPS code & primary diagnosis indicating musculoskeletal rehab billed

Scenario

Patient admitted to HH 01/01/20 with wound care coded as primary diagnosis on OASIS

RAP billed 01/10/20

OASIS correction submitted 01/15/20 indicating musculoskeletal rehab as primary diagnosis

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Scenario 9 – Functional Impairment Grouping

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Functional impairment grouping for payment period 01/01/20 is “3” based on SOC OASIS

Functional impairment grouping for payment period 01/31/20 is “2” based on ROC OASIS

Functional impairment grouping for payment period 03/01/20 is “1” based on recertification OASIS

Scenario

Patient admitted to HH 01/01/20 with functional impairment grouping of “3” on SOC OASIS

ROC OASIS completed 01/29/20 resulted in functional impairment grouping of “2”

Recertification OASIS completed 02/29/20 resulted in functional impairment grouping of “1”

Scenario 10 – Functional Impairment Grouping

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OASIS corrections after submission of claim require claim correction if results in change to functional impairment grouping

Claim billed 02/09/20 paid incorrectly

Claim correction submitted after 03/01/20

Scenario

Patient admitted to HH 01/01/20 with functional impairment grouping of “3” on SOC OASIS

Claim for payment period 01/01/20 billed 02/09/20

SOC OASIS correction transmitted to QIES 03/01/20 resulting in functional impairment grouping of “2”

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Scenario 11 – Comorbidity Adjustment

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High comorbidity adjustment applies for payment period 01/01/20

Low comorbidity adjustment applies for payment period 01/31/20

ScenarioPatient admitted to HH 01/01/20 with other diagnoses qualifying for high comorbidity adjustment

Patient admitted to hospital 01/24/20 due to unexpected cardiac event

HH care resumed 01/27/20 with other diagnoses qualifying for low adjustment

Scenario 12 – RAPs

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RAPs pay 20% of expected payment period amount based on proposed rule

RAP for payment period 01/01/20 paid $340 on (appx.) 01/20/20

RAP for payment period 01/31/20 paid $280 on (appx.) 02/12/20

Scenario

Patient admitted to HH 01/01/20 with expected payment for period of $1,700

RAP for payment period 01/01/20 billed on 01/10/20

Expected payment for period 01/31/20  is $1,400 & RAP billed on 02/02/20

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Scenario 13 – Claims

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Billed: 2F321Admission Source & Timing

2 (Institutional, early)

Clinical Grouping

F (MS Rehab)

Functional Impairment Grouping

3 (High)

Comorbidity Adjustment

2 (Low)

Billed: 1F321Admission Source & Timing

1 (Community, early)

Clinical Grouping

F (MS Rehab)

Functional Impairment Grouping

3 (High)

Comorbidity Adjustment

2 (Low)

Hospital billed its claim as 

observation stay rather than acute hospital stay

HH billed its claim indicating acute hospital stay

Scenario 14 – Claims

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Payment periods with no ordered visits must have a RAP submitted

RAP & claim billed for payment period 01/01/20

RAP for payment period 01/31/20 billed, paid & eventually auto canceled by MAC

RAP & claim billed for payment period 03/01/20

Scenario

Patient admitted to HH 01/01/20 for catheter care

Visits were made 01/01/20 & 03/01/20

Patient was discharged 03/10/20

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Summary

• Assess necessary revenue cycle process changes

• Apply transition strategies

• Build a checklist & implement early

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Glossary

• EMR Electronic medical record

• HH Home health

• HIPPS Health Insurance Prospective Payment System Code

• LUPA Low utilization payment adjustment

• MA Medicare Advantage

• MAC Medicare Administrative Contractor

• OASIS Outcome & Assessment Information Set

• PEP Partial episode payment

• PDGM Patient Driven Groupings Model

• QIES Quality Improvement & Evaluation System

• RAP Request for anticipated payment

• ROC Resumption of care

• SNF Skilled nursing facility

• SOC Start of care

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CONTACT INFORMATION

M. Aaron Little, CPA

Managing DirectorBKD, LLPmlittle@bkd.com417.865.8701

Melinda Gaboury, COS-C

CEOHealthcare Provider Solutionsmgaboury@healthcareprovidersolutions.com615.399.7499

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