Home Health Patient Driven Groupings

Home Health Patient Driven Groupings

The Centers for Medicare and Medicaid (CMS) announced a new Patient Driven Groupings Model for Home Health that replaces the Prospective Payment System effective January 1, 2020.   The PDGM uses 30-day periods categorized into many more case mix groupings that the prior PPS system, and these are categorized into subgroups.

To elaborate, a brief comparison of the PPS and PDGM model is as follows:

Old PPS HHRG Model for Home Health – 153 Distinct HHRGs

Under the prior Home Health Prospective Payment System (PPS):

  • The Home Health Resource Group (HHRG) had several components including functional domain and service utilization domain.
  • A patient assessment was performed and scored.
  • The result of the assessment groups categorized the patient into one of 153 Home Health Resource Groups (HHRGs).
  • These scores are correlated to episodes.
  • For example, a 58 day episode yields two new segments: a initial 30 day period (days 1-30) and a second 28 day period (days 31- 28)[i]

New Home Health Patient Driven Grouping (PDGM) Model for Home Health – 432 Distinct HHRGs

CMS finalized a case-mix classification model called Patient-Driven Groupings Model (PDGM), effective January 1, 2020. PDGM focuses on clinical characteristics, and secondarily other patient data to correlate home health episodes of care into payment categories.  As noted, PDGM uses 30-day periods categorized into 30 day subgroups are as follows:

  • Admission source (two subgroups), which can be either
    • (a) community admission source or
    • (b) institutional admission source
  • Timing of the 30-day period (two subgroups), which can be either
    • (a) early or
    • (b) late
  • Clinical grouping into one of twelve subgroups, which can be:
    1. musculoskeletal rehabilitation;
    2. neuro/stroke rehabilitation;
    3. wounds;
    4. medication management, teaching, and assessment (MMTA) – surgical aftercare;
      1. MMTA – cardiac and circulatory;
      2. MMTA – endocrine;
      3. MMTA – gastrointestinal tract and genitourinary system;
      4. MMTA – infectious disease, neoplasms, and blood-forming diseases;
      5. MMTA – respiratory;
      6. MMTA- other;
      7. behavioral health;
      8. or complex nursing interventions
  • Functional impairment level (three subgroups) which can be:
    • (a) low,
    • (b) medium, or
    • (c) high
  • Comorbidity adjustment (three subgroups) based on secondary diagnoses, which can be
    • (a) none,
    • (b) low, or
    • (c) high

Therefore, when attempting to ascertain where a patient / insured fits in the PDGM model for coverage and benefits eligibility for home health services, it is important to understand that the home health Patient Driven Groupings model results in a permutation of at least 432 possible case mix adjusted groups, calculated as

  1. Two (2) admission sources, times
  2. Two (2) timing, time
  3. Twelve (12) clinical groupings, times
  4. Three (3) functional impairment levels, times
  5. Three (2) comorbidity adjustments

Therefore, the math is (2*2*12*3*3) = or four-hundred-twenty-three (432) distinct case-mix adjusted payment groups.[ii]

OASIS Assessment Components

The OASIS items contributing to functional level are:

  1. M1033: Risk for Hospitalization
  2. M1800: Grooming
  3. M1810: Dressing Upper Body
  4. M1820: Dressing Lower Body
  5. M1830: Bathing
  6. M1840: Toilet Transferring
  7. M1850: Transferring
  8. M1860: Ambulation/Locomotion

CMS tracks and reports HHA Agency Level impact information for calendar year 2019 vs projected percent changes under PDGM using the CMS Certification Number (CCN).  Based on a therapy visit ratio, number of 60-day episodes, 30-day periods, CMS published estimated PDGM payments and the payment change percent projection.

[i] CMS. 2017 Methodology for HHRGs.  See https://www.cms.gov/Outreach-and-Education/Outreach/NPC/Downloads/2017-01-18-HH-Presentation.pdf

[ii] CMS. 2020 PDGM.  See https://www.cms.gov/Medicare/Medicare-Fee-for-Service-payment/HomeHealthPPS/Downloads/Overview-of-the-Patient-Driven-Groupings-Model.pdf

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Michael F. Arrigo

Michael Arrigo brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health IT, and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations who provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and medical billing, fraud damages, as well as electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, medical malpractice, insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software SA (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls IT audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and is published in Healthcare IT News.

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