What Providers Need to Know Right Now About PDPM

The Centers for Medicare & Medicaid Services’ Patient-Driven Payment Model (PDPM) takes effect on Oct. 1. When the reform takes effect, long-term post-acute care (LTPAC) facilities will see a big change in how they receive payment for delivering valuable patient care. While the payment reform will inevitably bring challenges, it will also present a significant opportunity for healthcare providers to transform the way care is delivered.

The Key To Success? Preparing Now

PDPM will create some massive operational challenges for healthcare providers already taxed with an aging population, the growing nursing shortage and significant regulations that can create an onerous system for delivering quality patient care. The biggest change is that providers can no longer rely on securing Medicare reimbursement for therapy minutes provided, as they do currently. Instead, repayment will be contingent on a predetermined amount based on a one-time patient assessment of patient progress and successful outcomes. This creates the need for a thoughtful, results-oriented, holistic approach to providing patient care.

Indeed, this new reimbursement approach represents an entirely new model for delivering patient care. While the new model will bring with it several significant adjustments for staff and leadership, they should ultimately lead to much-improved outcomes for patients and their families. 

How can providers put the processes in place so they are not only ready for PDPM come October, but for the longer-term transition to better quality care? By understanding and addressing each of the challenges they’ll likely face. 

Challenge One: Transforming The Way Care Is Delivered

While the new model has the potential to reduce administrative hours, it will require nurse specialization in some cases. For example, let’s consider Dave, a hypothetical patient who needs post-acute care following a fall, but who also suffers from depression and hypertension. Under PDPM, care facilities will be empowered and encouraged to take Dave’s depression and hypertension into account — providing services to specifically target his chronic conditions while rehabilitating him from his acute issue as part of a holistic care plan, rather than perhaps focusing solely on the volume of services provided or time spent with the patient, as previously allowed. This is beneficial for Dave, and other patients, because it focuses on their actual clinical needs, and for healthcare providers because clinically complex care is rewarded under PDPM, unlike under RUGS IV, where quantity was sometimes prized over quality.

That’s why even though October is month’s away, care facilities should start preparing now to minimize challenges and costs associated with the switch to PDPM. Client input and PointClickCare research have shown that it’s highly likely providers will need to reevaluate internal processes in order to be successful once PDPM is implemented. More clinically complex patients mean staff needs to be educated and given proper resources so they can provide care confidently. 

Challenge Two: Coding

Another challenge healthcare providers will face is the addition of new ICD-10 codes and how they are inputted for billing and processing purposes. Getting the right data before the 5-day patient assessment is coded may also pose an issue, as securing clinician sign-off and the needed medical information before the assessment will be challenging. Whereas providers used to be able to conduct up to five patient assessments over the first 90 days of a patient’s stay to determine Medicare reimbursement, PDPM only allows you to submit one data assessment before the patient’s fifth day. That means having up-to-date patient data is critical so that better decisions can be made in real-time. The introduction of new ICD-10 codes may also require providers to either hire a new coder or get existing staff trained for billing.

Challenge Three: New Roles And Technology

More codes, of course, also bring with them more room for error and potential disruption to workflow, causing problems in the billing process. Redefining the role of MDS Coordinator and ongoing training or retraining will likely be necessary since it will require more process management skills under PDPM. Having a platform that streamlines the data entry and billing processes will be a valuable asset for healthcare providers to get the most out of the new payment method. If these issues aren’t addressed prior to the switch, it could cause problems in the medical billing process and even non-payment: failure to comply means payment won’t be received by Medicare. Preparation includes redefining workflows to meet new requirements, shifting business models if the data does not support revenue targets, and implementing new technology to keep up with data-driven patient processes.

The journey we’ve mapped out for providers has five stages: conceptualize, standardize, analyze, optimize, and operationalize. 

Although PDPM does present providers with challenges, it also has the potential to bring numerous opportunities if they’re prepared and can handle the change well. CMS estimates that the new payment model could save providers up to $2 billion in administrative costs over the next ten years, or $12,000 and 183 hours in savings per provider annually. In order to maximize this, providers must have access to pre-admission data as soon as possible and institute best practices for ensuring it is accurate, up-to-date, and easily accessible. I believe this is where utilizing the most cutting-edge technology and services available, and developing an intelligent workflow is vital to success. 

This is an exciting chance to renew outdated operations and refocus on providing the best care possible for every patient, every time. This can be used to revamp the new patient assessment approach and ensure the necessary materials are received in time to receive payment. Additionally, having a reliable platform will make training and preparing employees easier.

Much can be gained with the switch to PDPM, from saved administrative costs to more holistic patient care. Most importantly, with proper preparation, patients like Dave will receive the top-notch clinical care they need and providers will receive timely reimbursement.

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