As part of the 2019 Home Health Proposed Rule, CMS published several documents to help home health agencies understand what they are calling PDGM. We all know about the fondness the folks at CMS have for acronyms. This one stands for Patient Driven Groupings Model. One of the published documents, called “PDGM Agency-Level Impacts, Estimated for CY 2019”, can be found on the CMS Home Health Agency (HHA) Center webpage. It shows the impact the PDGM program would have on your reimbursement based on claims with episodes ending in 2017 (with some exclusions). The document is in a zip archive which you can download via this direct link. Unzip it to find “PDGM Agency-Level Impacts Estimated for CY 2019.xlsx” amongst a total of three files. If you want to access the unformatted data, open “HHA Impacts.csv” instead.
Navigating “PDGM Agency-Level Impacts Estimated for CY 2019.xlsx”
Once you have opened the spreadsheet, you can look for your agency by the CCN number in the first column. CCN is the CMS Certification Number (or your Medicare number). You can then see what your Nursing/Therapy visits ratio is (the higher the quartile, the more nursing visits vs therapy visits you provide).
CMS also includes the number of 30-day periods your 2017 episodes would have had as well as the number of 60-day episodes they included in the sample. You can also see what categories your agency falls under as facility-based vs freestanding, for-profit vs non-profit vs government owned, urban vs rural, and your census division.
The last two columns show the total annual reimbursement of all of the included claims adjusted for 2019 payment parameters and how much money the agency would have received under PDGM. If you subtract the “Total $, PDGM” column from the “Total $, 153-group current system” column, you will see what effect PDGM would have had on your 2017 patient population.
What does it all mean?
For your agency, if your patient population remains about the same, this sheet gives an indication of whether you would lose or gain reimbursement under PDGM. Remember that this is an annual number so if the difference in reimbursement is -$4800, this translates to a loss of about $400 per month.
Looking at all of the numbers, it would seem that overall the differences are minor. The average difference in payments is about -($5). 4657 agencies show a loss while 5820 agencies show a gain and 3 agencies keep the same annual income. However, there are differences based on agency characteristics. We analyzed this spreadsheet and wanted to give you some meaningful data on reimbursement trends.
In the following tables, the column “# Agencies” reflects the number of agencies analyzed, “Overall” is the total difference divided by the total 153-group total system, “Average” is the average annual gain or loss percentage per agency, “Median” is the middle percentage value where half of the agencies values are higher and half are lower, “Loss” is the percentage of agencies whose 2017 data show that they would lose reimbursement under PDGM, “Gain” is the percentage of agencies whose 2017 data show that they would gain reimbursement under PDGM. Please note that these are just numeric trends and that you should review the spreadsheet for the specific impact PDGM is projected to have on your agency.
Freestanding vs. Facility-Based
|# Agencies||9624||# Agencies||856|
Freestanding agencies show a small overall loss at -0.37% but the average impact for a freestanding agency is projected to be +4.38% and 55% of agencies showed a gain.
For-Profit vs. Government-Owned vs. Non-Profit
|# Agencies||8385||# Agencies||436||# Agencies||1659|
For-profit agencies demonstrate a bit of an overall loss at -1.15% but the average difference is +4.54% with 54% of agencies projected to have a gain.
Urban vs. Rural
|# Agencies||8783||# Agencies||1697|
While overall, urban agencies show a slight loss of -0.57%, the average and median amounts are positive with more agencies showing gains than losses.
|SN/Therapy Quartile||# Agencies||Overall||Average||Median||Gain||Loss|
|1st Quartile (Lowest 25% SN)||2620||-9.91%||-12.03%||-11.45%||6%||94%|
|4th Quartile (Top 25% SN)||2620||+17.01%||+24.72%||+22.84%||95%||5%|
The nursing/therapy ratio is the number of nursing visits provided in 2017 divided by the sum of therapy visits provided in 2017. This tells CMS how many therapy visits for each nursing visit are provided. Agencies providing more nursing visits compared to therapy visits (higher quartiles) have a number greater than one versus agencies that are providing more therapy visits than nursing visits (lower quartiles) whose number is less than one.
Unfortunately, we were unable to obtain the thresholds for each quartile. We did an analysis of 2017 cost report data and it appeared that 1st Quartile agencies tended to have a ratio less than 0.85, 2nd Quartile around 0.85 to 1.4, 3rd Quartile around 1.4-2.5, and 4th Quartile greater than 2.5.
As you can see by the analysis above, it appears that agencies that provide proportionally more nursing visits would do better under PDGM than agencies that are more therapy-focused. A large number of the lowest proportional nursing providers would see a loss in the new system while most agencies in the top nursing quartile would see a gain.
|East North Central||IL, IN, MI, OH, WI||2012||-1.09%||+2.07%||-0.30%||49%||51%|
|East South Central||AL, KY, MS, TN||423||+0.92%||+2.53%||+0.44%||51%||49%|
|Middle Atlantic||PA, NJ, NY||479||+3.09%||+4.55%||+4.39%||65%||35%|
|Mountain||AZ, CO, ID, MT, NV, NM, UT, WY||675||-5.16%||-1.21%||-3.07%||39%||61%|
|Northeast||CT, ME, MA, NH, RI, VT||354||+2.48%||+6.72%||+3.84%||66%||35%|
|Outlying||GU, MP, PR, VI, PR||41||+11.00%||+10.86%||9.81%||90%||10%|
|Pacific||AK, CA, HI, OR, WA||1400||+3.80%||+7.52%||+6.09%||68%||32%|
|South Atlantic||DE, DC, FL, GA, MD, NC, SC, VA, WV||1643||-5.32%||-4.41%||-5.62%||30%||70%|
|West North Central||IA, KS, MN, MO, NE, ND, SD||703||-3.89%||-0.26%||-3.06%||42%||58%|
|West South Central||AR,LA,OK,TX||2750||+4.08%||+12.19%||+10.16%||74%||26%|
This table breaks down the data by division. Outlying and West South Central divisions would see more agencies gaining under PDGM while South Atlantic and Mountain divisions would see more agencies losing reimbursement.
We threw a lot of numbers at you and some of those numbers look really scary (especially if you are a high-therapy agency in the South Atlantic). But you really need to look at your individual agency data to know the estimated impact for your patient population. While some trends look more favorable to certain agency types, and more agencies are poised to gain under PDGM, agencies across all categories had losses and gains. Now is the time for every agency to begin assessing the impact of PDGM and preparing accordingly. We here at Pragma-IT will continue to provide thoughtful analysis, information, and improvements in therapyBOSS to help agencies in their efforts.