When preparing for the Patient-Driven Groupings Model (PDGM), it’s vital to examine how many visits your agency provides individual patients during 30-day periods — and to determine whether those episodes would be considered LUPAs under PDGM.
 
LUPAs pay considerably less money than a standard episode, so a significant increase in LUPAs and a decrease in standard episodes would hurt your bottom line.
 
Deeper analysis of the PDGM will give your agency a better sense about how often the care you provide will result in LUPAs as opposed to your agency receiving a standard episode payment. This is important to know since the new payment model will use a different way to determine if an episode is a LUPA.
 
Despite the fact that episodes under PDGM will last 30 days instead of 60, LUPAs still will occur under the new payment model that’s slated to begin in 2020. But unlike in the PPS, where a LUPA involves four or fewer visits during an episode, the threshold for the number of visits needed for an episode in PDGM to be a LUPA will vary.
 
The number of visits provided for an episode to be a LUPA depends on the individual patient’s PDGM payment group. Under PDGM, there will be 432 home health resource groups (HHRGs). That’s far more than the 153 that exist under PPS.
 
Agencies should examine Table 32 in the 2019 PPS final rule to determine how many visits an agency must provide for an episode to not be a LUPA.
 
The highest LUPA threshold under PDGM would be six visits in a 30-day period. That means an agency could provide up to five visits in 30 days and the episode would still be a LUPA.
 
The lowest threshold would be two visits in a 30-day period. That means all an agency would have to do is provide two visits in 30 days in order to avoid a LUPA.
 
In 2019, the average episode payment rate is $3,154.27. And LUPA rates in 2019 are $146.50 per visit for a skilled nurse, $160.14 for physical therapy and $161.24 for occupational therapy.
 
CMS will calculate a proposed national, standardized 30-day payment amount, but that proposal would be included in next year’s payment rule, industry experts say. The same rule will detail how much LUPAs would pay.
 
CMS expects agencies to avoid LUPAs
 
In the 2019 PPS final rule, CMS contends about 8% of episodes under the PPS are LUPAs and about 7% of episodes under PDGM will be LUPAs — assuming there’s no behavior change among providers.
 
CMS notes in the rule that data currently suggest about 33% of episodes with visits near the LUPA threshold “move up to become non-LUPA episodes.” CMS assumes that trend will continue under PDGM, meaning about 33% of episodes that would be one or two visits below the LUPA threshold would move up so the agency would avoid the LUPA.
 
CMS is clearly noting in the rule that it’s paying attention to agencies’ provision of care and how that might shift under PDGM, experts say. As a result, agencies must remain careful when it comes to documenting episodes where visits barely extend beyond the LUPA threshold.
The home health industry previously was warned that the government would scrutinize such claims.
 
In June 2018, the HHS Office of Inspector General (OIG) announced plans to conduct a review of home health claims where patients receive five to 10 skilled visits. OIG wants to know whether these claims “met the conditions for coverage and were adequately supported as required by federal guidance.”
 
Proposal comes despite prior feedback
 
When in the 2018 proposed PPS rule CMS pitched having variable LUPA thresholds within a Home Health Groupings Model (HHGM), several commenters voiced opposition.
 
Some commenters argued that having variable thresholds would lead to “additional administrative burden and create additional opportunity for error,” CMS notes in the 2019 proposed PPS rule.
 
But CMS stood by its plan to have variable thresholds, saying it will be an improvement over having a single threshold. CMS contends the change won’t lead to increased administrative burden “as LUPA visits are billed the same as non-LUPA periods.”
 
Also, since PDGM won’t be implemented until 2020, agencies and vendors will have “sufficient time to make necessary changes to their systems and to ensure that appropriate quality checks are in place to minimize any claims errors,” CMS states in the 2019 proposed rule.
 
How do you determine your payment?
 
Payments are based on a variety of factors, some of which are new and based on principal diagnosis in the form of clinical groupings and diagnoses that may classify as comorbidities under the new model.
 
Take the following steps to get a sense of how many LUPAs your agency might have under PDGM:
  1. Examine a sample of recent episodes. Agencies probably won’t want to review a year’s worth of claims for this project, but it makes sense to use the past quarter’s episodes in your analysis. Separate out all 60-day episodes that involved 14 visits or fewer. This should cover most visits that would result in a LUPA under PDGM.
  1. Divide those episodes into two 30-day periods. It makes sense to break your 60-day episodes in half since PDGM has 30-day payment periods.
  1. Consider the setting from which each of those patients came — institutional or community.
  1. Note whether care is early or late. The first 30 days of care the patient receives will be considered an early episode. The second 30-day stretch and beyond will be late.
  1. Categorize patients based on one of the 12 clinical groups. Those groupings are: Musculoskeletal rehabilitation; Neuro/stroke rehabilitation; Wounds — post-op wound aftercare and skin/non-surgical wound care; Complex nursing interventions; Behavioral health care; Medication management, teaching and assessment (MMTA) — surgical aftercare; MMTA — cardiac/circulatory; MMTA — endocrine; MMTA — GI/GU; MMTA — infectious diseases/neoplasms/blood forming diseases; MMTA — respiratory; and MMTA — other.
  1. Identify the intensity of care you’ll need to provide. From OASIS items, determine if the patient’s functional level is low, medium or high. Use Table 29 in the PPS final rule to determine functional level.
  1. Note whether there’s a comorbidity adjustment. In PDGM, CMS will have three levels in the comorbidity case-mix adjustment: no comorbidity adjustment, low comorbidity adjustment and high comorbidity adjustment. Adjustments will be determined based on the claim, which allows agencies to designate one principal diagnosis and 24 secondary diagnoses. This approach takes into account more than just the six diagnoses included on the OASIS and will allow more episodes to receive a comorbidity adjustment, CMS says in the PPS final rule.
  1. Once you determine the HHRG based on that information, view Table 32 to determine how many visits might be provided until the care stops being a LUPA.