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Proposed Rule for IRF, SNF, and Hospice Services Released

May 30, 2017:

The Centers for Medicare and Medicaid Services (CMS) has been busy this spring, releasing on May 3 proposed rules for inpatient rehabilitation facilities (IRF) and hospices, and on May 4 a rule pertaining to skilled nursing facilities (SNF). Each of the proposed rules puts forth payment updates as well as tweaks to the programs.

Hospice Services

The proposed rule contains a payment increase of 1 percent for hospice services.

The rule also proposes allowing hospices to use documentation from the referring physician to certify terminal illness. Certification from the hospice medical director or patient’s primary care physician could be used only if no other documentation were available. The aim is to require more thorough and comprehensive documentation supporting a terminal prognosis of six months or less. This change is proposed for development for implementation at a later time based on the results of research and development.

To support research and development, CMS proposes continuing to expand the Hospice Evaluation Assessment & Reporting Tool (HEART), which is an information set. Along with quality and patient satisfaction measures, as well as standardized patient assessment data that post-acute care providers much submit as required by the Medicare Post-Acute Care Transformation of 2014 (IMPACT Act), HEART will expand the current HIS to become akin to the Outcome and Assessment Information Set (OASIS) used in the home health setting.

There are no proposals for new or eliminated quality measures.

The proposed rule contains some data that indicate some positive trends. Comparing the top 10 most common primary diagnosis codes reported by hospices in 2013 against those in 2016, it is encouraging that unspecified dementia diagnosis codes have fallen completely off the list. Their absence suggests that hospices may be realizing that these codes cannot be used for terminal diagnoses and are educating their physicians accordingly.

Other data could be signs that some hospices still need to learn the nuances of coding and reporting. For example, code J44.9 (COPD, unspecified) appears as the third most frequently reported hospice diagnosis, whereas J44.1 (COPD with exacerbation) comes in as number 8. This could be because some hospices do not understand that when the COPD is decompensated, as is usually the case, they must not use the unspecified code. Code G31.1 (Senile degeneration of brain, NEC) is listed as the fifth most common hospice diagnosis—it is possible that some hospices are erroneously assigning this code frequently for patients with dementia.

Data also suggest that hospices are changing their coding and caring practices in response to CMS policy changes. After the agency directed hospices to code more than one diagnosis and to include all diagnoses affecting the terminal diagnosis on the claim, all—100 percent—submitted more than one diagnosis on each claim in 2016. Hospices are also more closely monitoring patients in their final days, with more frequent visits, possibly in response to payment changes made to encourage more clinical care toward the end of life. CMS notes, however, that some of these visits are provided by nonclinical staff, such as clergy or social workers, which was not the intent. For this reason, the agency will continue to monitor care provided in a patient’s final days.

Skilled Nursing Facilities

The proposed rule for SNFs puts forth a market basket increase in payments of 1 percent for fiscal 2018 (SNFs that fail to submit measures data will have a 2 percentage point reduction applied to the market basket increase).

CMS proposes additional policies, measures, and data for the SNF quality reporting program. The agency proposes that standardized patient assessment data be reported at least for facility admissions and discharges for functional status; cognitive function; special services, treatment, and interventions; medical conditions and comorbidities; impairments; and other categories deemed necessary.

Inpatient Rehabilitation Facilities

The IRF rule proposes an updated payment rate of 1 percent and suggests removing the 25 percent payment penalty currently levied for late transmissions of the IRF patient assessment instrument. In explaining its rationale for dropping the penalty for submitting a PAI late, CMS notes that facilities cannot get paid by Medicare for a Part A fee-for-service patient unless a claim and a PAI have been filed. The agency believes this is enough motivation to submit PAIs promptly and that the penalty is unnecessary.

The agency also proposes revising the list of diagnosis codes that count toward the 60 percent rule for presumptive compliance, revising the technical IRF process, and making some changes to the IRF quality reporting program that would take effect for 2020. CMS is also soliciting comments on the criteria facilities must meet to be classified for payment under the IRF prospective payment system (PPS).

In the conversion to ICD-10-CM, several problems cropped up in the diagnosis codes used in assessing presumptive compliance. CMS is particularly focusing on codes for:

  • Traumatic brain injury and hip fracture
  • Multiple trauma
  • Nonspecific and arthritis diagnoses

The agency is also looking at code G72.89 (Other specified myopathies), which it believes is being used incorrectly.


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