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November 2005

RUGS 53 - Effects on Skilled Nursing Facility Payments

On your mark, get set, go! The new RUGS 53 classification will be in effect
January 1, 2006. So what does that mean to Skilled Nursing Facilities (SNF)? The new classification will reflect the 3.1 percent market basket increase reflected in the reallocation of funds in the new 53 RUGS, with a recalibration of the case mix indices for all RUG III groups. Those of you who look at this as an opportunity, verses another change, will find success and financial rewards for your facilities.

RUGS 53 created nine new RUG categories that combine Rehab Therapy and Extensive Services. The new RUG categories include RUX, RUL, RVX, RXL, RHX, RHL, RMC, RML and RLX. This will lead to higher reimbursement than currently received by residents in either category. The nine new RUGS will be at the top of the RUG III hierarchy. Along with this change, there has been a revised definition of Urban and Rural based areas, which will also affect your reimbursement.

To fall into one of the new nine RUGS, the resident must have services from therapy with the same qualifying minutes as before, as well as one of the clinical qualifiers from Extensive Services. These qualifiers include IVs or parenteral feeding, IV medications, suctioning, tracheostomy care and ventilator/respirator care, along with an Activities of Daily Living (ADL) score of seven or higher. It is important to know that the case mix reimbursement does not fall into the hierarchal line of the RUGS 53. With this in mind, the Centers for Medicare and Medicaid Services (CMS) has come to realize that many SNF residents are not able to tolerate intense therapy times with a new admission into a SNF facility. Even more important, there is a true need for a team decision on setting the Assessment Reference Date (ARD). Having the look back period, including days in the hospital, to capture services in the hospital, verses using grace days to capture therapy minutes, will have to be looked at carefully. The reason is reimbursement rates for RUC, RUB and RUA, which are existing RUGS, have a higher reimbursement rate than RVL, RHX, RHL and RLX, which are four of the nine new RUGS.

Key Minimum Data Set (MDS) items to watch include: 1) ADL scoring in section G; 2) IV for fluid intake in section K(b); 3) parenteral feedings in section K(a); 4) IV medications, suctioning and tracheostomy care in section P(a); 5) section P(b) for therapy minutes; and 6) section T(b), (c) and (d) for estimate of therapy minutes and days. There are also areas in the Special Care and Clinically Complex RUGS that give you points towards the nine new RUGS.

Best Practices you need for your facility are formal data gathering from all shifts through interview, observation and an easier ADL flow sheet for ADL documentation that focuses on ADL self-performance and support provided. Education of MDS definitions for both aides and nurses along with education on all subtasks in each ADL grouping should be offered for all nursing staff. Lastly, the setting of the ARD must be a joint decision between nursing and therapy so the most effective number of therapy minutes being offered and projected can be captured.

Pre-admission screening also continues to play an important role in gathering documentation of clinical services provided in the acute setting and gathering underlying medical conditions that may impact the care of the resident. With this in mind, the ARD chosen for the Prospective Payment System (PPS) assessment should capture the clinical condition of the resident and the services provided. I hope your facility embraces this as an opportunity to be successful in accurately assessing your residents' needs, efficiently delivering your resources to meet their needs and capturing all of the services provided. You can be a real winner!

Sandy Stewart, RNC

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