Patient-Driven Payment Model (PDPM)

The Patient-Drive Payment Model (PDPM) is here, and AANAC will continue to help you through the transition. Visit this page frequently for new tools, education, and resources for ongoing success under PDPM.

  • Is Your State Considering PDPM Data Collection? Four Steps to Prepare

    By Jessie McGill, RN, RAC-MT, RAC-MTA - August 19, 2020

    The Centers for Medicare and Medicaid Services (CMS) gave states the option to collect Patient-Driven Payment Model (PDPM) billing codes on OBRA assessments when not combined with a Medicare PPS 5-Day assessment, beginning Oct. 1, 2020. While most of the information used to establish these codes is already on the OBRA assessments, the additional data collection will require both time to complete and training to perform correctly. Notably, the addition of completing the admission performance column for section GG (Functional Abilities) will take the most time. A lack of proper training for the staff completing this section has the potential to cause inaccuracies and confusion among direct care staff. However, the stress and workload can be mitigated with a strong preparation plan and ongoing support to direct care staff. Follow these four steps to ensure your team is ready to complete successfully the documentation and data collection for section GG on OBRA assessments:

    1.      Understand how your state is using the information and expected future implications

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  • MDS Section J: Learn What ‘Major’ Surgery Means

    By Caralyn Davis, Staff Writer - August 04, 2020

    “Does this surgery count as a major surgery?” is one of the most frequently asked questions that nurse assessment coordinators (NACs) have about MDS items J2100 (Recent Surgery Requiring Active SNF Care) and J2300 – J5000 (Recent Surgeries Requiring Active SNF Care: Surgical Procedures), says Carol Maher, RN-BC, RAC-MTA, RAC-MT, CPC, director of education for Hansen, Hunter & Co. PC in Vancouver, WA.


    “It’s an important question because capturing a major surgery in J2100 and J2300 – J5000 can make a difference in the Medicare Part A payment that you receive for the physical therapy (PT) and occupational therapy (OT) components under the Patient-Driven Payment Model (PDPM),” says Maher. “A major surgery can move the resident from their default primary diagnosis clinical category established in I0020B (ICD Code/Primary Medical Condition) into a potentially higher-paying surgical clinical category for PT and OT.”

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  • FY 2021 SNF PPS Final Rule Released (7/20)

    By CMS - August 02, 2020

    On July 31, 2020, the Centers for Medicare & Medicaid Services (CMS) issued a final rule [CMS-1737-F] for Fiscal Year (FY) 2021 that updates the Medicare payment rates and the value-based purchasing program for skilled nursing facilities (SNFs). CMS is publishing this final rule consistent with the legal requirements to update Medicare payment policies for SNFs on an annual basis. In recognition of the significant impact of the COVID-19 public health emergency, and limited capacity of health care providers to review and provide comment on extensive proposals, CMS has limited annual SNF rulemaking required by statute to essential policies including Medicare payment to SNFs.

    The final rule includes routine technical rate-setting updates to the SNF prospective payment system (PPS) payment rates, and adopts the revised Office of Management and Budget (OMB) statistical area delineations.  In addition, the rule applies a 5 percent cap on wage index decreases from FY 2020 to FY 2021. In response to stakeholder feedback, we are also finalizing changes to the International Classification of Diseases, Version 10 (ICD-10) code mappings, effective October 1, 2020. Finally, this rule includes minor administrative changes related to the SNF Value-Based Purchasing (VBP) Program.

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  • Hospital Diagnoses: Why You Need to Do a Deeper Dive

    By Caralyn Davis, Staff Writer - July 21, 2020

    Obtaining the most specific medical diagnosis benefits skilled nursing facilities (SNFs) on two fronts: receiving accurate reimbursement under the Patient-Driven Payment Model (PDPM) for Medicare Part A residents and improving the quality of care for all residents, says Carol Maher, RN-BC, RAC-MTA, RAC-MT, CPC, director of education for Hansen, Hunter & Co. PC in Vancouver, WA.


    “Often, to get a diagnosis to map from the MDS to a clinical category for the physical therapy (PT), occupational therapy (OT), or speech-language pathology (SLP) payment components under PDPM, you need a more specific diagnosis,” explains Maher. “However, it’s not all about payment. Even without the mapping problem, the resident’s medical record needs to be as accurate and complete as possible, and that includes having accurate diagnoses so that the interdisciplinary team can provide the correct treatment.”


    For example, if a resident goes to see an outside provider, the face sheet that the nursing home sends with that resident should be as accurate as possible, she points out. “If the resident had a heart attack, was the myocardial infarction a STEMI (ST-segment elevation myocardial infarction) or a non-STEMI? You don’t want to leave that type of diagnosis unspecified because including the most accurate diagnosis on the nursing home face sheet could affect that outside provider’s treatment decisions and the resident’s overall quality of care.”

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  • To IPA or NOT To IPA: That Is an Important Question

    By Carol Maher, RN-BC, RAC-MTA, RAC-MT, RAC-CTA, RAC-CT, CPC - May 05, 2020

    Healthcare professionals were relieved when CMS agreed to make the Interim Payment Assessment (IPA) optional instead of a requirement. This meant that skilled nursing facilities (SNFs) could decide when or if they would complete these payment assessments. CMS anticipated that SNFs would perform IPAs during each Medicare Part A stay both to improve Medicare payment during the stays and to monitor patients’ clinical status. However, data shows that few IPAs are being completed.


    One likely reason why: the complexity of the new Patient-Driven Payment Model (PDPM) makes it difficult to know when an MDS would improve the final payment. John Kane, CMS’s SNF Payment Team Lead, stated during one of CMS’s train-the-trainer sessions that there could be as many as 1,900 possible payment combinations per PPS MDS.


    So how can you know whether an IPA would improve the Medicare payment? First, let’s consider the impact of CMS’s original plan to require the IPAs. CMS proposed that IPAs would be completed when there was a change in one of the first-tier classification criteria in any of the proposed payment components. For example, if the resident had been classified into the Major Joint Replacement category for the PT/OT component and their primary diagnosis changed to Medical Management, the IPA would have been required. Likewise, when a resident’s Nursing component category changed from Extensive Services to Special Care Low, an IPA would have been required. We are grateful that assessments are not mandatory in these circumstances, but they provide a useful starting point for understanding when an IPA could be financially beneficial.


    In the SNF PPS Final Rule for FY 2020, CMS included the following table showing the FY 2020 federal unadjusted urban base rates for each of the six PDPM payment components:

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  • Part A Physician Certs/Recerts: CMS Confirms How to Count Days

    By Caralyn Davis, Staff Writer - May 05, 2020

    To bill under traditional fee-for-service Medicare Part A, skilled nursing facilities (SNFs) must obtain appropriate, timely physician certifications and recertifications of posthospital inpatient extended-care services. The physician cert/recert policy did not change with the implementation of the Patient-Driven Payment Model (PDPM) on October 1, 2019.


    However, the Centers for Medicare & Medicaid Services (CMS) did adjust the instructions in the Medicare Online Manual System to explain when providers need to obtain a new physician certification vs. when they should continue using the existing cert/recert to account for the interrupted stay policy that was implemented in conjunction with PDPM. This adjustment brought to light the fact that some SNFs may be counting calendar days instead of Medicare days to determine when certs/recerts are due—a practice that is incorrect CMS officials tell the American Association of Nurse Assessment Coordination (AANAC).


    “The regulations at 42 CFR 424.20(d) state that the first recertification is required no later than ‘the 14th day of post-hospital SNF care.’ This would have the schedule track with the days of the stay (i.e., covered days) rather than calendar days,” explain officials. Note: Review the physician cert/recert section of the Code of Federal Regulations in the box at the end of this article.


    “This also tracks with previous statements we have made comparing the recertification timeline with the variable per-diem schedule, and interrupted stays have similar impacts on both, as noted in response to FAQ 13.21,” say officials. Here is the FAQ excerpted from Patient-Driven Payment Model: Frequently Asked Questions (FAQs):

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  • FY 2021 SNF PPS Proposed Rule: CMS Holds Steady on the SNF QRP, SNF VBP

    By Caralyn Davis, Staff Writer - April 13, 2020

    On April 10, the Centers for Medicare & Medicaid Services (CMS) released for public inspection the Fiscal Year (FY) 2021 Proposed Rule for the Skilled Nursing Facility Prospective Payment System (SNF PPS) and Consolidated Billing (CMS-1737-P) as required by law. In a major break from recent years, CMS offers no proposals for updating the Skilled Nursing Facility Quality Reporting Program (SNF QRP) and only what the agency describes as “minor administrative proposals” related to the SNF Value-Based Purchasing (VBP) program.


    However, CMS does propose several other revisions in addition to the required Medicare Part A payment rate update. These include:


    • Multiple changes to the ICD-10-CM code mappings used for case-mix classification in the Patient-Driven Payment Model (PDPM);

    •  Technical changes to the regulatory language in the Code of Federal Regulations, including a proposed change that will clarify the “practical matter” criterion of a Part A skilled level of care by removing an outdated example that referred to the repealed Part B therapy cap provision; and

    • Changes to how SNFs are identified as rural or urban for wage index classification, as well as a proposal to cap wage index decreases from FY 2020 to FY 2021 as a transition measure.


    CMS also is keeping its options open for future adjustments to the PDPM based on its ongoing monitoring efforts. Here are highlights of the FY 2021 proposed rule.
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  • The Particulars of Coding Pre-Admission Data and PDPM

    By Jessie McGill, RN, RAC-MT, RAC-MTA - April 01, 2020

    When the nurse assessment coordinator (NAC) prepares to code the MDS, the process starts with data collected during the lookback period. However, one frequently-asked question is, “When can services that occurred prior to admission to the skilled nursing facility (SNF) be captured on the MDS?” There is no simple answer, because it depends on the coding instructions for each MDS item. Let’s take a look at the particulars of coding preadmission data, why it is collected, and how preadmission data is used under PDPM.



    Chapter 3 of the RAI User’s Manual contains the coding instructions for each MDS item; however, the overview of chapter 3, pages 3-1 through 3-6, are often overlooked. This brief section discusses coding conventions, which apply to all MDS items, and includes the instructions on preadmission data:

    With the exception of certain items (e.g., some items in Sections K and O), the lookback period does not extend into the preadmission period unless the item instructions state otherwise. In the case of reentry, the lookback period does not extend into time prior to the reentry, unless instructions state otherwise.


    MDS Item Set 1.17.1 Preadmission Data and Why It Is Collected

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  • MDS Item I8000: Solve Common Coding Problems Under PDPM

    By Caralyn Davis, Staff Writer - April 01, 2020

    Under the Patient-Driven Payment Model (PDPM), MDS item I8000 (Additional Active Diagnoses) is on every nurse assessment coordinator’s (NAC’s) radar thanks to its role as a source of ICD-10-CM diagnosis codes that can influence the speech-language pathology (SLP) or nontherapy ancillaries (NTA) case-mix-adjusted payment components—not to mention its role providing risk-adjustment covariates for the Skilled Nursing Facility Quality Reporting Program (SNF QRP) quality measures (QMs) says Carol Maher, RN-BC, RAC-MTA, RAC-MT, RAC-CTA, RAC-CT, CPC, director of education for Hansen, Hunter & Co. PC in Vancouver, WA.


    “Despite this renewed focus on I8000, NACs and other interdisciplinary team (IDT) members are still struggling with diagnosis coding,” says Maher. “There is a lot of confusion in SNFs across the country.”


    Here are seven steps the NAC and other IDT members can take to address common problems that may prevent I8000 from being coded accurately:

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  • Section GG: CMS Training Videos for GG0130H, GG0170L, GG1070P (3/20)

    By CMS - March 23, 2020

    The Centers for Medicare & Medicaid Services is releasing three short video tutorials to assist providers with coding Section GG. These videos, ranging from 5 to 10 minutes, are designed to provide targeted guidance using simulated patient scenarios. To access the videos, click on the links below:

    ·         GG0130H. Putting on/taking off footwear.

    ·         GG0170L. Walking 10 feet on uneven surfaces.

    ·         GG1070P. Picking up object.

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  • SNF Claims Incorrectly Canceled (3/20)

    By CMS - March 23, 2020

    From January 26 through February 16, 2020, a software issue caused Skilled Nursing Facility (SNF) claims to be incorrectly cancelled with a message that there was no three day qualifying hospital stay. This issue is corrected. If your claims were incorrectly cancelled, re-bill them in sequential order to receive payment.


    ·         Claims need to process in date of service order for each stay for the Variable Per Diem (VPD) to calculate correctly

    ·         Submit claims in sequence and wait at least 2 weeks before billing subsequent claims

    ·         Some of the affected claims with older dates of service will require a timely filing exception; enter “Resubmission due to non-qualifying stay” in the remarks field

    ·         This issue was not caused by the recent implementation of the SNF Patient Driven Payment Model

    ·         Contact your MAC to receive the Medicare Beneficiary Identifier (MBI) for deceased beneficiaries

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  • 11 MDS Change Areas That Will Impact You October 1

    By Caralyn Davis, Staff Writer - March 03, 2020

    Nurse assessment coordinators (NACs) and other MDS assessors must be ready to code multiple new standardized patient assessment data elements (SPADEs) and other MDS items that will be required to meet the data submission threshold in the Skilled Nursing Facility Quality Reporting Program (SNF QRP), as well as new or revised items that aren’t part of the SNF QRP, effective this October 1.


    However, it’s not time for practice coding scenarios just yet. The draft version 1.18.0 MDS item sets and their companion MDS 3.0 Item Set Change History for October 2020 Version 1.18.0 remain in draft format. In addition, the Centers for Medicare & Medicaid Services (CMS) hasn’t announced a timeline for releasing a revised Long-Term Care Facility Resident Assessment Instrument 3.0 User’s Manual, and significant training opportunities from CMS are still months away.


    Nevertheless, AANAC master teachers recommend NACs and other interdisciplinary team (IDT) members go ahead and take a bird’s eye look at the following revisions:

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  • ICD-10 Code Lookup Tool / National Center for Health Statistics (2/20)

    By MX - February 04, 2020

    What is the ICD-10-CM Browser Tool [ Beta Version]

    The National Center for Health Statistics ICD-10-CM Browser tool is a user-friendly web-based query application allows users to search for codes from the International Classification of Diseases, 10th Revision, Clinical Modification (ICD-10-CM) and provides instructional information needed to understand the usage of ICD-10-CM codes. The application provides access to multiple fiscal year version sets that are available with real-time comprehensive results via the search capabilities.

    The National Center for Health Statistics updates ICD-10-CM on an annual basis.  In addition to the new browser tool, ICD-10-CM and all approved updates to the classification are still available on this webpage for public use.

    Features include:

    Online user’s guide


    • The Official ICD–10–CM Coding Guidelines
    • ICD–10–CM Tabular List of Diseases and Injuries
    • ICD–10–CM Index to Diseases and Injuries
    • ICD–10–CM External Cause of Injuries Index
    • ICD–10–CM Table of Neoplasms
    • ICD–10–CM Table of Drugs and Chemicals

    Functionality features include:

    • Search Index for main term or subterms
    • Search by ICD–10–CM code
    • Pop-up instructional notes
    • Ability to toggle from the Index to the Tabular list.
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  • Get Back to Nursing Basics to Determine Skilled Services

    By Caralyn Davis, Staff Writer - February 04, 2020

    With the rush to understand the Patient-Driven Payment Model (PDPM) under the Skilled Nursing Facility Prospective Payment System (SNF PPS), it’s easy to get caught up in meeting the technical criteria for payment—and not pay enough attention to the clinical criteria for meeting a Medicare skilled level of care, says Jennifer LaBay, RN, RAC-MT, RAC-MTA, CRC, an MDS/policy consultant for Triad Health Care LLC in Providence, RI.


    “PDPM puts the focus on the primary medical condition that is coded in MDS item I0020B using an ICD-10-CM diagnosis code,” explains LaBay. “However, there is a general misunderstanding about what the ICD-10 code in I0020B means. Some nurse assessment coordinators (NACs) look at an ICD-10 code and ask, ‘Is this a skilled diagnosis?’ That’s the wrong question, and you need to avoid falling into the trap of thinking that an ICD-10 code in I0020B that does not return to provider (RTP) means you have a skilled service.”


    The primary medical diagnosis in I0020B only sets the payment. “Specifically, it determines a resident’s default clinical category for PDPM’s physical therapy (PT), occupational therapy (OT), and a portion of the speech-language pathology (SLP) payment components,” she notes.

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  • Q&A: Could I set the ARD of an IPA for a previous calendar day if our facility determined that day would be the most beneficial?

    By Scott Heichel, RN, RAC-MT, RAC-CTA, DNS-CT, QCP, CIC - February 04, 2020
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