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The revised Patient Driven Payment Model (PDPM), which took effect in late 2019, brought with it a new way of calculating reimbursements. Now, long term care facilities need to focus on a case-mix model of clinically relevant factors to calculate reimbursement scores, rather than just volume-based services. 

In this guide, we will give you a PDPM cheat sheet by:

  • Walking you through the optimal process of coding each step of your PDPM score
  • Helping you understand coding pitfalls
  • Showing how to add those scores to get your overall score and corresponding reimbursement amount using our free PDPM Admission Tool
  • Drawing your attention to that which helps you achieve a high score and maximize reimbursement under the new Patient-Driven Payment Model

How the PDPM Functional Score Works

PDPM is a per diem payment that is based on clinical characteristics, the patient assessment and diagnosis, and the resources needed to care for the resident. The daily reimbursement rate will depend on how sick the resident is and how many resources are required in order to provide high-quality care. Under PDPM, skilled nursing facilities are reimbursed for both the time their residents spend there and the complexity of care they receive. It was developed to encourage providers to focus on providing high-quality care that improves outcomes.

This new method is a shift from the Prospective Payment System (PPS), which used Resource Utilization Groups (RUG) rates to determine costs and was based on the volume of service, like the number of therapy minutes received, rather than what the resident’s day looks like. This new system of coding, by contrast, considers how much care the nursing staff provides and how much time and resources are allocated to each resident. You can find more details on the differences between RUG and PDPM.

Calculating your PDPM score isn’t a simple and straightforward formula, so we have pulled together a number of resources to help you through the process.

Before this new structure, there was a 3-level score that was a straight hierarchy. Now we have a number of different sections each of which correlates to a letter. Each letter then correlates to a dollar amount. All sections are then added together to get the overall functional score and reimbursement amount.

There are five components calculated from MDS coding that impact PDPM reimbursement:

  1. Physical therapy (PT) Score
  2. Occupational therapy (OT) Score
  3. Speech-language pathology (SLP) Score
  4. Nursing Score
  5. Non-therapy ancillary (NTA) Score

Calculating the PT & OT Functional Score in PDPM

The first category that you will need to calculate are the PT and OT function scores. These are scored on a 0-16 scale. The more independent the resident is the higher their score. So in this particular category, the lower the score, the more care and assistance the resident requires.

There are several activities of daily living (ADL) factors to calculate here in order to get a final score for Step 1 in this section and best use our PDPM cheat sheet.

  • Eating, oral hygiene, and toiletry hygiene are all straightforward scores that you will add together.
  • Sit to lying and lying to sitting should be scored and averaged.
  • Sit to stand as well as chair, bed and toilet transfers should be added and averaged.
  • Walking 50′ and walking 150′ should be averaged.

This calculation will give you a total PT/OT ADL score for Step 1 in this section.

Step 1 2

The next step in the PT/OT section is to decide what the primary diagnosis will be for the resident. Previously, this would have been decided based on whatever diagnosis the doctor gave at the hospital. However, there were some potential problems with this. One was that the primary issue for which the patient was being treated at the hospital was not always the primary issue for which they were receiving care at the long term care facility.

For example, a patient with Parkinson’s Disease may have entered a hospital to be treated for a UTI. Once the UTI was treated, they may have been released to a nursing home for rehabilitation and to build their strength back up after being hospitalized for a number of days. In the hospital, the primary diagnosis was a UTI. At the nursing home, though, the primary diagnosis is to treat the secondary effects of being sick with Parkinson’s. For the purpose of scoring the PDPM, you would use acute neurological as the primary category rather than medical management. In an instance like this, the resident director should have a conversation with the doctor to agree on the primary diagnosis for the purpose of the resident’s stay at the nursing facility.

Once you have determined the main category, you will need to look at the total PDPM ADL score that you calculated in Step 1 and the corresponding letter for this section. It is important to get the primary diagnosis right in order to get the maximum allowable reimbursement. For instance, an ADL score of 10 in the Acute Neurological section qualifies for more reimbursement than an ADL score of 10 in the Medical Management section.

Step 2 and 3

Calculating the SLP Functional Score

The next section you will need to calculate for residents with speech-related comorbidities is the SLP score. The first thing to document in this section is whether or not the patient falls under the category of acute neurological, which was determined in the previous section when determining the primary diagnosis. If the resident does fall under the section of acute neurological, you would get the one point for that.

Step 4a

Next, you add one point for each comorbidity listed in the chart. An additional point should be added if the resident has cognitive impairment, which would be determined by a Brief Interview for Mental Status (BIMS). Now, you’ll add up the number of points received for this step and get either a 0, 1, 2, or 3.

Step 4b

The last step in the SLP section is to consider whether the resident has a mechanically altered diet, swallow disorder, or both. Depending on your number score and whether there is one, both, or neither of these will determine the letter assignment and correlating dollar amount.

mech altered diet

Communicating with the Speech-Language Pathologist

When it comes to speech-language factors, doctors tend to defer to the speech therapist, so you may need to coordinate a discussion between the doctor and the speech therapist in order to get the most accurate information. Although speech therapists cannot give diagnoses, they can guide the doctor toward a more accurate diagnosis.

One of the ways that you can maximize your reimbursement and ensure you are receiving the proper scores is to pay extra attention to what the nurse mentions when discussing the resident’s care. For example, if the nurse mentions that they have to change the resident’s clothing two to three times per day, you should dig deeper into this discussion and find out what the root cause may be. If it is because the resident is dribbling food when they eat, you can infer that there may be a swallow disorder, which should prompt a discussion with the speech therapist and the doctor.

The Director of Nursing (DON) may have to facilitate discussions between a number of people on the care team. It is the responsibility of nursing home leadership to look for indicators that these discussions may be needed in order to achieve the correct functional score.

Calculating the Nursing Functional Score

Calculating the nursing ADL score is more straightforward than the first two steps. This is because nurses do not deal as much with PT/OT or speech issues as they do with daily care activities like moving the resident in order to avoid bedsores. The numbers for this section can be pulled straight from the previous steps.

step 5
Example of calculating PDPM ADL score.

Ensure Proper Training for Nursing Staff

When it comes to calculating the nursing ADL scores, you can maximize reimbursements with proper training at the nurse or aide level to make sure they understand the differences between categories. Light touch and moderate assistance can be subjective, so you want to make sure everyone is on the same page with what falls under each category.

Take, for example, the different levels of assistance given to a resident during meals. If the nurse or aide has to touch the resident’s hand slightly to remind them to put the spoon in their mouth, that would be light touch (supervision), but if they have to help the resident put the spoon to their mouth, that would be considered partial to moderate assistance. It is important that everyone can accurately determine the level of assistance needed in cases like these.

A good way to make sure the information is being coded accurately is to ask detailed questions. Rather than asking “How much help does this resident need?” ask the question, “How does this resident get the food from the plate to their mouth?”

CNAs who were using RUG-IV group codes will need a certain amount of retraining. You still have to code things the new way for Medicaid, so right now, you may need to ask a CNA or nurse aid to code the same thing two different ways.

Determining the Nursing RUG Group

The next step in this section is to determine a nursing RUG group, which is similar to how things were done previously with Medicaid. For this step, you will need to go down a hierarchy. The higher up the resident lands, the more care the resident requires and the more reimbursement money will be provided.

In this step, you will want to pay special attention to certain things to ensure you are maximizing your reimbursement:

  • Are the nurses providing respiratory therapy at least seven times per week? That will automatically put you into one of those higher categories. Respiratory therapy must be documented for at least 15 minutes per day, seven days per week. It can include minutes of nebs, inspirometer, lung assessment, and any minutes spent with a respiratory therapist in actual treatment.
  • Does the resident have chronic obstructive pulmonary disease (COPD)? If so, do they have shortness of breath when lying flat, meaning they have to be propped up on pillows? If this is the case, those residents are more prone to getting pneumonia, which means they will require more care, and, in turn, more time. That automatically puts them into one of the high categories.
  • Note that septicemia is different from sepsis.  Septicemia places the patient into the Special Care High.  Review a sepsis diagnosis carefully by  looking at labs and having a discussion with the doctor about a diagnosis clarification if clinically appropriate.
step 6a

As you move through the chart, you will cross-reference the inclusion criteria with whether or not the resident has depression and what their ADL score is, to end up with the HIPPS letter and corresponding reimbursement amount for this section.

Calculating the NTA Functional Score

The last component of determining the resident’s functional score is to include the NTA score. This section includes a number of things for which long term care facilities previously did not get paid but were time-consuming. Now, these factors are taken into consideration when determining reimbursement amounts.

If any of the conditions listed on this section apply to the resident, they would get the correlating points for that condition. This section is also fairly straightforward: add up the points to determine the final score, which tells you where you fall. However, this section may require you to have more discussions with the doctor

step 7a
Example of calculating PDPM functional score.

Again, there are some things to which you will want to pay special attention in order to ensure you are maximizing your reimbursement.

For Example:

  • If you have a long-time alcoholic who is in recovery, but they have long-term liver damage and take medication for that, you may need to ask the doctor if the resident meets the criteria for diagnosis of cirrhosis of the liver, which you would award an additional point.
  • If a resident does score for cirrhosis of the liver, that can sometimes be related to malnutrition. It would be worth having a conversation with the dietician to see if that is a factor. That will get you to the next level and significantly increase your payment.
  • Doctors may sometimes be hesitant to diagnose inflammatory bowel disease, for insurance reasons. You might need to look at the data and context clues. Are there foods the resident needs to avoid? Are there foods they are allergic to? If so, that may be an indicator that they have inflammatory bowel disease, which would prompt a discussion with the doctor to add that diagnosis.

The most important thing here is to look for the low-hanging fruit or opportunities that you may initially glance over. In this section, just going from two points to three points is almost a 25% increase in payment. Paying close attention to potential diagnoses here can make a big difference in the reimbursement amount.

How to Achieve Accuracy: A PDPM Cheat Sheet

To achieve an accurate prediction of what your score will be and how much reimbursement you will receive, you will need to follow the steps in this PDPM cheat sheet. You should add up the scores for each section. There are many factors that help determine the PDPM functional score, and there is plenty of room for human error, so make sure to double-check to see that the scores are what you expected, as this will help with accuracy.

step 7b

There are a lot of things to consider here, and you will find that this new scoring system means that you spend a lot more time with your doctors, dieticians, speech therapists, and others on the care team. Taking the time to have those extra conversations will not only result in optimal reimbursements for the facility but also, most importantly, the best possible resident care.

step 8

Getting Started With Implementation

A good place to start on Day 1 is by reviewing paperwork. Then, once the nurse has the opportunity to go in and evaluate the resident, they can have a conversation with the rehab director. By day 3, you should have had the opportunity to talk to the doctors and nurses and gather more information. Then you can talk with the care plan team and the family. So by the end of Day 3, the goal is to have projected a reimbursement rate and have a strong plan for what the resident needs in order to go home.

For those who are new to this process or are used to doing things according to previous standards, this may seem like a lot to take in, and the process may seem overwhelming at first. Experience Care has an entire featured section on PDPM Functional Score resources to help guide you and your team through this process. You can also read this article for more information specifically on calculating PDPM Functional Score.