Patient Driven Payment Model (PDPM): What Dietitians Need to Know

The Centers for Medicare and Medicaid Services (CMS) transitioned to a new payment rule for skilled nursing facilities (SNFs) called the patient-driven payment model (PDPM).

Under PDPM, dietitians have a unique opportunity to identify, document, and treat key nutrition-related diagnoses for improved patient outcomes and increased financial reimbursement.

This article explains what dietitians need to know about the patient-driven payment model changes and the opportunities it provides for reimbursement for nutrition and food-related services.

patient driven payment model

What is the patient-driven payment model (PDPM)?

PDPM is a case-mix classification system for classifying SNF patients in a Medicare Part A covered stay into payment groups.

Medicare Part A (hospital insurance) covers skilled nursing care provided in an SNF, assuming several conditions are met (1).

The PDPM replaced the previous case-mix classification system — the Resource Utilization Groups, Version IV (RUG-IV) — on October 1, 2019 (2).

Under RUG-IV, most patients were classified into a therapy payment group that uses the volume of therapy services provided to the patient as the basis for payment. This incentivized SNF providers to provide therapy services to SNF patients regardless of their individual characteristics, goals, or needs.

PDPM eliminated this incentive and now classifies patients into payment groups based on specific, data-driven patient characteristics.

According to CMS, this will improve payments by:

  • Improving payment accuracy and appropriateness by focusing on the patient, rather than the volume of services provided.
  • Significantly reducing the administrative burden on providers.
  • Improving SNF payments to currently underserved beneficiaries without increasing total Medicare payments.

Components of PDPM

PDPM consists of five case-mix adjusted components:

  • Physical therapy (PT)
  • Occupational therapy (OT)
  • Speech-language pathology (SLP)
  • Nursing
  • Non-therapy ancillary (NTA)

PDPM also includes a variable per diem (VPD) adjustment that adjusts the per diem rate to reflect varying costs throughout a patient’s stay.

Under PDPM, each patient is classified into a group for each of the five case-mix adjusted components.

Dietitians’ role in PDPM

Of the five case-mix adjustment components, two strongly apply to dietitians — SLP and NTA.

Speech-language pathology

For the SLP component, PDPM uses different patient characteristics predictive of increased SLP costs, including:

  • Presence of an acute neurologic condition
  • SLP-related comorbidity or cognitive impairment
  • Mechanically-altered diet
  • Swallowing disorder

Dietitians can assess whether a patient may benefit from a mechanically-altered diet or have a swallowing disorder and refer that patient to the SLP for evaluation.

Any identified swallowing problem or patient requiring a mechanically altered diet should be coded appropriately on the MDS Section K.

Non-therapy ancillary

The NTA component is based on the presence of certain comorbidities or the use of certain services.

Because a simple count of diseases or conditions overlooks the differences in care costs, the NTA component utilizes a tier system that accounts for differences in relative costliness.

With this tier system, each comorbidity used under PDPM is assigned a number of points, between 1 and 8, based on its relative costliness.

To determine a patient’s NTA comorbidity score, providers identify all comorbidities for which a patient qualifies and then add the points for each comorbidity. The higher the sum, the higher the reimbursement factor, whereas the lower the sum, the lower the reimbursement factor.

CMS has identified a list of 50 conditions and services that are associated with increases in NTA costs under PDPM.

Of the 50 conditions and services, several are relevant for dietitians, including:

  • Parenteral IV feeding level high (7 points): 51% or more of total calories received through IV feeding.
  • Parenteral IV feeding level low (3 points): 26-50% of total calories received through IV feeding and average fluid intake by IV or feeding tube of 501 cc per day or more.
  • Morbid obesity (1 point): BMI greater than or equal to 40 kg/m2.
  • Malnutrition (1 point): Use a valid screening tool such as the mini nutritional assessment tool (MNA) for adults 65 years and older to assess malnutrition risk. The physician must document malnutrition if the dietitian diagnoses malnutrition based on his or her comprehensive nutrition assessment.
  • Feeding tube (1 point): Includes nasal or abdominal tube.

CMS recognizes these conditions and services under PDPM, and provides an opportunity for increased reimbursement, which is designed for the facility to increase the use of appropriate services, such as medical nutrition therapy by a dietitian.

MDS changes

Under the RUG-IV assessment schedule for patients in a Medicare Part A covered stay, assessments had to be completed on or around days five, 14, 30, 60, and 90, with the start, end, or change of therapy as well as any significant change in status.

But under the PDPM assessment schedule, assessments have to be completed on or around day five and at discharge. An interim payment assessment (IPA) may also need an MDS assessment if providers wish to report a change in a patient’s PDPM classification.

Sections K and L of the MDS stay the same under PDPM, however, K0100: Swallowing Disorder, is added to the discharge MDS.

There are no changes in the Omnibus Budget Reconciliation Act (OBRA) assessments — admission, quarterly, annual, or significant change in status.

The bottom line

PDPM is the case-mix classification system for patients in a Medicare Part A covered SNF stay into payment groups.

Under PDPM, identifying and documenting nutrition-related diseases and conditions such as dysphagia, nutrition support, obesity, and malnutrition, can increase facility reimbursement for nutrition- and food-related services.

That said, it’s important for dietitians to understand how PDPM relates to improved prevention and management of nutrition-related diseases and conditions along with obtaining appropriate reimbursement for those services.

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