Home Health & Hospice Week

Source of admission might add thousands of dollars to your episode.

Whether you sink or swim under the new payment reform model taking effect in January 2020 may depend on your referral sources.

Why? The Patient-Driven Groupings Model, newly finalized in the 2019 Home Health Prospective Payment System rule, designates a new case mix element — whether a patient is admitted from the community or an institution. And that element can pack a big punch to your reimbursement level for the episode, shows the rule published in the Nov. 13 Federal Register.

Judging by the rule’s case mix weight table, being designated an institutional episode under PDGM adds an additional 0.182 for early episodes and 0.4469 for late episodes, points out Diane Magrady, compliance lead with Morton Grove, Illinois-based Pragma-IT.

Translation: Consider the reimbursement rate for 2019 as an illustration. The standardized episode payment rate is $3,154.27, Magrady explains. Thus, the difference between a community and institutional case mix would be a base rate of $574.08 per early episode and $1,409.64 for late episodes, before wage index adjustments, she calculates.

Another way to look at it: “One of the easiest ways of gaining insights into the financial impact is to look at the case-mix weights and how they are weighted differently just for the community/institutional designation,” explains billing expert M. Aaron Little with BKD in Springfield, Missouri.

For example: The category for MMTA — Other, community, early, low functional, no comorbidity adjustment carries a 0.9939 case-mix weight in the rule. When “changing the variable from ‘community’ to ‘institutional,’ with all other variables the same, the case-mix weight increases to 1.1759,” Little points out.

What does that mean for your actual PDGM payment amounts? Absent a 30-day episode figure, which CMS declines to provide at this time, you can look at the rule’s economic impact analysis, Little suggests. “When estimating the ratio of average PDGM payment to average 30-day equivalent PPS payment, CMS estimated the impact of the community admission source would be a ratio of 0.89 whereas the institutional admission source ratio is 1.29,” Little tells Eli.

Bottom line: “It’s a very large financial impact,” Little emphasizes.

Here’s When Discharges Are Required

The Centers for Medicare & Medicaid Services will determine whether an episode is community versus institutional by looking at certain facility stays within the 14 days prior to the start of the 30-day home health billing period. For an “early” episode — the first or standalone — stays at acute care hospitals, skilled nursing facilities, inpatient rehabilitation facilities, long-term care hospitals, and inpatient psychiatric facilities all count toward the institutional designation. (IPFs were added in the final rule — see related story, p. 331.)

The methodology is a little different for “late” episodes, however. Acute care hospitals still count no matter what, but post-acute care facility stays for SNFs, IRFs, and LTCHs, as well as IPFs, will count only if the home health agency discharges and readmits the patients.

“The institutional admission source category will … include patients that had an acute care hospital stay during a previous 30-day period of care and within 14 days prior to the subsequent, contiguous 30-day period of care and for which the patient was not discharged from home health and readmitted (that is, the admission date and from date for the subsequent 30-day period of care do not match) as we acknowledge that HHAs have discretion as to whether they discharge the patient due to a hospitalization and then readmit the patient after hospital discharge,” CMS says in the rule.

“However, we will not categorize post-acute care stays (SNF, IRF, or LTCH) or IPF stays that occur during a previous 30-day period and within 14 days of a subsequent, contiguous 30-day period of care (that is, the admission date and from date for the subsequent 30-day period of care do not match) as institutional,” CMS continues. “We would expect the HHA to discharge the patient if the patient required post-acute care in a different setting or inpatient psychiatric care and then readmit the patient, if necessary, after discharge from such setting.”

How Medicare can tell: “If the patient was discharged and then readmitted to home health, the admission date and ‘from’ date on the 30-day claim would match and the claims processing system will look for an acute or a post-acute care stay within 14 days of the home health admission date,” CMS explains.

PAC Exclusion Impact Will Vary

How excluding PAC stays without a discharge from the institutional designation for later episodes will affect you will depend on how you handle those types of stays, experts say. PDGM’s policy shouldn’t be too detrimental, expects billing expert Melinda Gaboury with Healthcare Provider Solutions in Nashville, Tennessee. “It won’t be a biggie because we discharge when admitted to those facilities anyway,” Gaboury tells Eli.

But that’s not true for all providers, says consultant Pam Warmack with Clinic Connections in Ruston, Louisiana. “I would say that 99 percent of the time, the agencies I am exposed to simply transfer and do a Resumption of Care any time this is an option,” Warmack relays.

Why? “A new SOC requires a new F2F and new initial assessment with all the required paperwork, patient consents, etc.,” Warmack explains. “It is more economical to do a ROC verses a new admission.”

That’s why “my experience with HHAs is that when patients are transferred into an inpatient facility, most providers elect to transfer them and do a ROC when they return home,” Warmack says. “Unless, of course, the inpatient stay crosses over from one episode to another, we must discharge and start over with a new SOC when they return home,” she adds.

Note: The 2019 HH PPS final rule is at www.gpo.gov/fdsys/pkg/FR-2018-11-13/pdf/2018-24145.pdf.