Part 1 — Sustaining Financial Health Under PDGM: Your EHR Can Help

May 15, 2019 Liza Markling

In HomeCare’s recent webinar, “Sustaining Financial Health Under PDGM,” I joined with Ron Barrera, Director of Financial Consulting for Simione Healthcare Consultants, for a conversation on how Home Health Agencies (HHAs) can prepare for Medicare’s new Patient-Driven Groupings Model (PDGM) rule coming in 2020. Did you know that more than 44 percent of HHAs will experience a decrease in reimbursement under PDGM? While that statistic is frightening, you can take steps today to determine if you are one of those providers who may be negatively affected. Spending time now to investigate the potential impact PDGM will have on your reimbursement can help to reduce its ramifications later.

Ron and I looked at multiple categories in which HHAs can analyze their reimbursements under the current Prospective Payment Systems (PPS) versus the upcoming PDGM rule:

  • Clinical Groupings
  • Visit Frequencies
  • Source and Timing
  • Visit Utilization
  • Episode
  • Revenue Cycle

We further broke down that analysis by comparing examples from one large and one small agency, to give webinar participants a better understanding of what to expect given the size of their organization.

Clinical Groupings: Explore New Opportunities

With the transition to PDGM, understanding the new clinical groupings is critical. Up to 18 percent of today’s current episodes would be considered “questionable encounters” under PDGM, which means that the primary diagnosis code for the episode does not fall into any of the new groupings. The primary diagnosis will be the only factor that determines an episode’s clinical grouping. Therefore, it’s important to research questionable encounters now and make sure you’re coding correctly.

You should be able to leverage your Electronic Health Record (EHR) in evaluating the clinical groupings category. PointClickCare is working to provide early insight into the entry of diagnosis codes, giving HHAs the opportunity to confirm whether a diagnosis used today would either fall into one of the new groupings or would end up as a questionable encounter under PDGM. Users throughout your workflow should be aware of the potential impact and process to remedy an inaccurate diagnosis code before it goes too far down the billing path. Some of the very common diagnosis codes used today will not be reimbursed under PDGM, so it’s important to begin educating your clinicians regarding diagnosis coding now. We’re looking into incorporating Medicare’s grouper software into our solution to help users navigate these pieces of the workflow. This would give them the anticipated grouping, as well as the projected output of that episode, a preview of what they’ll see as PDGM rolls out next year.

Look at Visit Frequencies by Clinical Grouping

Planning visit frequencies will become a little trickier under PDGM, since the rule implements two 30-day periods as a basis for payment versus the 60-day periods now in use. Meanwhile, your Outcome and Assessment Information Set (OASIS) assessments will remain on a 60-day cycle, and you will have one set of orders for each episode. However, you’ll have to manage the frequency of your visits to the clinical groupings across the two 30-days periods, so you can be alerted to possible Low Utilization Payment Adjustments (LUPAs).

Ongoing metrics and analysis in your EHR will play an important role in helping you better understand your care delivery model and manage your visit frequencies. We’re working on some new key performance indicator (KPI) dashboards for our home health solution, to give agencies real-time insight into an episode as it’s being planned. You can begin tracking visit frequencies now as you prepare for the PDGM roll-out, so you know where you stand and where you need to be by next year. Look at not only clinical groupings, but also overall utilization of disciplines, questionable encounters, and length of stay. Will what you’re doing today work for your agency in the future?

Watch for my next post, with details on how an analysis of your reimbursements in terms of source and timing, visit utilization, episodes, and revenue cycle, will help you better prepare for PDGM.

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