On Aug. 8, 2018, the Centers for Medicare & Medicaid Services (CMS) published a final rule requiring the implementation of a new Medicare Part A skilled nursing facility prospective payment system (SNF PPS) beginning on Oct. 1, 2019. Resident days through Sept. 30 will be paid under the resource utilization groups, version IV (RUG-IV) payment model. Resident days beginning on Oct. 1 will be paid under the patient-driven payment model (PDPM).
Now that the clock starts on this new era of the Medicare Part A SNF PPS, providers should consider assessment and payment logistics related to residents whose Medicare Part A stay begins prior to Oct. 1 and remain on Part A as PDPM is implemented.

All stays that start before Oct. 1: Any Part A stay started before Oct. 1 and continuing into October will be subject to RUG-IV assessment schedules and per diem payment policy up to and including Sept. 30 and be subject to PDPM policy for dates of service beginning Oct. 1. Resident days for stays extending into October will be subject to PDPM rates established by a one-time “transitional” interim payment assessment (IPA) described in the box on page 16. If providers expect a resident stay to extend into October, they should start gathering and documenting the clinical information in September necessary to permit proper PDPM classification in the transitional IPA.

Stays starting Sept. 24 through Sept. 30: SNF PPS per diem payments for residents admitted on or after Sept. 24 through Sept. 30 will still be paid under RUG-IV through Sept. 30. However, CMS requires that the assessment reference date (ARD) for the five-day assessment for these admissions be no later than Sept. 30 so that a RUG-IV rate can be determined for the September dates of service.

Special consideration should be given to resident stays that start during this date range because the shortened assessment reference period may impact the RUG-IV classification and rates for the late September dates of service.

For example, under RUGs, to qualify for Rehab Ultra High, Rehab Very High, Rehab High, and Rehab Medium case-mix groups, the resident must receive therapy at least five days during the assessment reference period. If a facility does not furnish therapy on weekends, the only way a resident could qualify for a rehab RUG for the remainder of September would be to have therapy start no later than September 24. If weekend therapy is provided, then the resident could start daily therapy services as late as Sept. 26 to qualify for a rehab RUG in September.

No admissions from Sept. 27-30 will be able to qualify for a rehab RUG in September because it will be impossible for the beneficiary to receive five days of therapy services during the assessment reference period. Providers will not be able to use the RUGs short-stay assessment for late September Part A admissions to qualify for a rehab RUG for these dates because the short-stay policy only applies to residents discharged from Medicare.

Resident stays started on or after Oct. 1: These stays will be paid under the PDPM assessment schedule and per diem rate policies. A transitional IPA is not to be used for stays starting in October. Providers will use the SNF PPS five-day assessment, with an ARD no later than Day 8 of the stay to determine the PDPM resident classification health insurance prospective payment system (HIPPS) billing code.

Preparing for these one-time PDPM implementation issues leading up to Oct. 1 will better assure a seamless transition to PDPM. CMS resources related to the PDPM and resident assessment requirements described above include:


Transitional Interim Payment Assessment (IPA)

For residents continuing Medicare Part A services into October, to receive a PDPM HIPPS code that can be used for billing for dates of service beginning Oct. 1, 2019, all providers will be required to complete an IPA with an ARD no later than Oct. 7, 2019. Oct. 1, 2019, will be considered Day 1 of the variable per diem schedule under PDPM, even if the patient began their stay prior to Oct. 1, 2019. Any “transitional IPAs” with an ARD after Oct. 7, 2019, will be considered late, and the late assessment penalty (default rate) would apply up to the ARD of the late assessment.

Tip: Providers can look back into September dates of service as part of the transitional IPA assessment reference period. To ease workload in scheduling the transitional IPAs, providers may consider setting ARDs for these assessments any time beginning Oct. 1.