PDGM Series 3/5: PDGM & Home Health Clinicians

Still trying to figure out what PDGM means to you as a Home Health Clinician?  PDGM is causing anxiety for home health clinicians and agency owners.  There are concerns about how PDGM will affect jobs and the ability for agencies to stay in business.  In this third part of an ongoing topic series on PDGM, this guide is meant to help clinicians understand the key components in the new payment model and how they can impact value beyond the visit.

There are four components within PDGM. To begin understanding what all this means for clinicians and agencies alike, let’s dig into the four categories that determine the case mix weights and reimbursements. 

1. Admission source & Timing.  The first category for determining payment is Admission source.  This is not to be confused with the referral source, which is  the person who referred the patient to the agency.  The patient will be admitted to a home health agency from either an Institutional or Community source, dependent on the setting utilized in the 14 days prior to home health admission. The difference is if the patient is discharged from an acute care stay (hospital) or post-acute care stay (nursing home) it will be classified as Institutional source, all others will be Community source.   Under PDGM, the first 30 day payment episode is considered early, and all others are late. Early episodes and an institutional source are reimbursed at a higher rate due to the need for more resources driving up the cost to care for this patient. 

2. Clinical Grouping.   The primary diagnosis which is listed first on the claim is the main reason why the patient is receiving home health services and it determines which of the 12 categories the case will be paid under.

3. Functional Impairment Level.*  This component justifies the need for therapy services and reimbursement under PDGM.  There are three levels assigned for reimbursement purposes – Low, Medium, and High functional impairment.  

The functional impairment level assigned to the episode is determined by responses to eight questions from the OASIS assessment.  These questions are the M-1800 items that address functional status. The only difference between PPS and PDGM is that the Grooming question (M-1800) and Risk for Hospitalization (M-1033) generate case-mix points when before it did not.  

Case-mix points are assigned to each answer and the total sum of case-mix points will result in the functional impairment level.  It is vital for clinicians to collaborate with each other immediately after opening the case to make sure accurate responses on the OASIS are being submitted. 

4. Comorbidity adjustments.* PDGM will allow Home Health Agencies to designate one principal diagnosis and up to 24 secondary diagnoses.  According to CMS, comorbidity is tied to poorer health outcomes, more complex medical needs and management, and higher resource costs.  Under PDGM, there will be a designated comorbidity adjustment of none, low, or high for each 30-day period based on a patient’s secondary diagnoses reported on the claim.

  • A low comorbidity adjustment will be designated if there is a reported secondary diagnosis that is associated with higher resource use.
  • A high comorbidity adjustment will be designated if there are two or more secondary diagnoses that, when reported together, are associated with higher resource use.
  • There will be no comorbidity adjustment if there are no documented secondary diagnoses that fall into either the low or high comorbidity adjustment.

Clinicians are the ones that directly interact with patients.  If it is found through an assessment that the patient has additional comorbidities that have not yet been coded, these should be verified with the patient’s physician so they can be documented.  These diagnoses that were missed, could affect the agencies ability to be reimbursed appropriately. Also, it could change the patient’s plan of care and can give more justification for increased utilization.  

With PDGM, thorough patient assessments and accurate documentation become so much more important for agencies to continue to run efficiently and continue to provide opportunities for home health clinicians to meaningfully impact the lives of the the patients in their communities.

In our next post, we will discuss how utilization guidelines provided by some EMRs can be a useful tool for clinicians.