Summary: States will have access to an optional assessment to support RUG-III and RUG-IV from October 1, 2019 through September 30, 2020. Effective, Oct. 1, 2020, states that continue to use RUG-III or RUG-IV after October 1, 2020 will need to implement a new process to gather the needed data because many of the corresponding MDS items will no longer be present on the MDS.

Memo:

On October 1, 2020 CMS will no longer support RUG-III and RUG-IV case-mix methodologies via the Minimum Data Set (MDS). PDPM utilizes a streamlined assessment schedule compared to RUG-III and RUG-IV by eliminating all current scheduled assessments, except the 5-day, and all unscheduled assessments (i.e., Other Medicare-Required Assessments). For States that rely on these assessments for calculating their case-mix group, CMS has created an optional assessment so that Medicaid payment is not adversely impacted when PDPM is implemented on October 1, 2019. States will have some flexibility in crafting policies associated with this assessment. The optional assessment will be effective from October 1, 2019 through September 30, 2020.

Finally, in an effort to reduce provider burden, improve quality of care, and standardize data elements across provider settings, CMS will be removing several MDS data elements over the next few years. Many MDS data elements used in RUG-III and RUG-IV are no longer required for Federal purposes. With the removal of data elements, RUG-III and RUG-IV will no longer be functional. States that continue to use RUG-III or RUG-IV after October 1, 2020 will need to implement a new process to gather the needed data.

In July 2018, CMS finalized a new case-mix classification model, the Patient Driven Payment Model (PDPM), that, effective beginning October 1, 2019, will be used under the Skilled Nursing Facility (SNF) Prospective Payment System (PPS) for classifying SNF patients in a covered Part A stay. This site includes a variety of educational and training resources to assist stakeholders in preparing for PDPM implementation.

Fact Sheets

This section includes fact sheets on a variety of PDPM related topics.

• Administrative Level of Care Presumption under the PDPM
• PDPM Payments for SNF Patients with HIV/AIDS
• Concurrent and Group Therapy Limit
• PDPM Functional and Cognitive Scoring
• Interrupted Stay Policy
• MDS Changes
• NTA Comorbidity Score
• PDPM Patient Classification
• Variable Per Diem Adjustment

 

PDPM Frequently Asked Questions

This section contains frequently asked questions (FAQs) related to PDPM policy and implementation.

PDPM Training Presentation

This section includes a training presentation which can be used to educate providers and other stakeholders on PDPM policy and implementation.

PDPM Resources

This section includes additional resources relevant to PDPM implementation, including various coding crosswalks and classification logic.

The Centers for Medicare & Medicaid Services (CMS) recently released an updated Hand in Hand Series for Nursing Homes, a training series focused on caring for residents with dementia and on preventing abuse. While CMS isn’t currently offering continuing education units (CEUs) for Hand in Hand, the agency recommends—but does not mandate—that providers use Hand in Hand to fulfill federal requirements for training all nursing home staff about dementia management and resident abuse prevention, said CMS officials at the Oct. 11 Skilled Nursing Facility/Long-term Care Open Door Forum (ODF).

 

“Federal law requires that nurse aides complete in-service training on dementia management and resident abuse prevention,” they explained. “Additionally, facilities must now provide dementia management and resident abuse prevention training to all facility staff, contractors, and volunteers.”

Medicare Program: Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities Final Rule for FY 2019, SNF Value-Based Purchasing Program, and SNF Quality Reporting Program

This final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2019. This final rule also replaces the existing case-mix classification methodology, the Resource Utilization Groups, Version IV (RUG-IV) model, with a revised case-mix methodology called the Patient-Driven Payment Model (PDPM) beginning on October 1, 2019. The rule finalizes revisions to the regulation text that describes a beneficiary’s SNF “resident” status under the consolidated billing provision and the required content of the SNF level of care certification. The rule also finalizes updates to the SNF Quality Reporting Program (QRP) and the Skilled Nursing Facility ValueBased Purchasing (VBP) Program. 

Correction Notice SUMMARY: This document corrects technical errors in the final rule that appeared in the August 8, 2018 Federal Register (83 FR 39162) entitled “Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities (SNF) Final Rule for FY 2019, SNF Value-Based Purchasing Program, and SNF Quality Reporting Program.” DATES: The corrections in this document are effective October 1, 2018 .

On July 31, the Centers for Medicare & Medicaid Services (CMS) released the Fiscal Year (FY) 2019 Skilled Nursing Facility Prospective Payment System (SNF PPS) final rule, ushering in a new payment era for traditional fee-for-service Medicare Part A that will be unlike anything SNFs have seen before. The Patient-Driven Payment Model (PDPM) will go into effect on Oct. 1, 2019 (i.e., starting with FY 2020), replacing the RUG-IV case-mix classification model that has been the hallmark of SNF PPS for years.

Skilled nursing facilities should save approximately $2 billion in aggregate reduced administrative costs over the next 10 years ($12,000 and 183 hours in savings per provider annually), said officials with the Centers for Medicare & Medicaid Services (CMS) in a review of key aspects of the Fiscal Year (FY) 2019 SNF PPS Proposed Rule during the May 1 Skilled Nursing Facility/Long-term Care Open Door Forum. This estimate is based on the proposed changes to the skilled nursing facility prospective payment system (SNF PPS) assessment schedule associated with the Patient-Driven Payment Model (PDPM) if it’s implemented as proposed on Oct. 1, 2019.

 

“While the current [RUG-IV] system requires substantial paperwork to track the volume of service utilization over time, PDPM eliminates the need of these frequent patient assessments and allows clinicians to focus more time on treating the patient,” noted officials. Note: PDPM is based on the Resident Classification System, Version I, or RCS-I, that CMS presented last year.

On May 4, 2017, the Centers for Medicare & Medicaid Services (CMS) turned the SNF world upside down, publishing an Advance Notice of Proposed Rule-Making (ANPRM) detailing preliminary plans to replace the existing case-mix classification system (i.e., RUG-IV) under SNF PPS with a new model called the Resident Classification System, Version I, (RCS-I) to eliminate financial incentives related to therapy provision and to better account for resident characteristics and care needs.

 

On April 27, 2018, CMS managed to turn the SNF world upside down yet again, proposing to launch a revised case-mix classification model called the Patient-Driven Payment Model (PDPM) effective Oct. 1, 2019, (i.e., starting with FY 2020) in the Fiscal Year (FY) 2019 Skilled Nursing Facility Prospective Payment System (SNF PPS) Proposed Rule, making the use of therapy minutes to classify a resident for payment purposes obsolete, significantly altering the PPS assessment schedule, and instituting a variable per-diem payment adjustment schedule for the first time in SNF PPS history.