Patient-Driven Payment Model (PDPM)- The Significance of ICD-10 Coding

By Melissa Keiter, RN, RAC-CT, DNS-CT, DON And Melissa Sabo, OTR/L, CDP, CSRS

As healthcare providers, we all understand the importance of properly coding diagnoses on the MDS. However, the significance of accurate and appropriate ICD-10 coding plays an even more vital role under PDPM. The diagnosis coding will be the foundation used to classify a resident into PT, OT and SLP categories and for some aspects of NTA reimbursement. The ICD-10 code is used for assigning the clinical categories for PT and OT case-mix classifications, which are: Major Joint Replacement or Spinal Surgery, Other Orthopedic, Non-Orthopedic or Acute Neurologic and Medical Management. Speech Therapy only has two case mix diagnosis groups which are Acute Neurologic and Non-Neurologic. Under PDPM, data from the MDS, starting with the ICD-10 code and category that supports the SNF Part A stay, is used to classify a resident into these categories and determine payment. PT and OT case-mix and payments are determined exactly alike.  However, Case Mix Index (CMI) scores and payment will differ for each discipline. SLP case mix and payment is determined by the ICD-10 code category for SNF admission, as well as factors including swallowing disorders, mechanically altered diets, speech co-morbidities and cognition, all of which are derived from MDS data.

In the RUGS-IV payment model, each resident is classified into one RUG group based on the combined data included in the MDS. Under the PDPM model, nursing, non-therapy ancillary, PT, OT and ST each have a separate classification, CMI and per diem rate. Each category receives a CMI and per diem rate that is independent of the other categories. Residents will fall into a PT, OT and SLP category regardless of the actual provision of therapy services and their case-mix will not be impacted if therapy is not provided or clinically indicated per the therapist’s assessment. However, because therapy minutes must be reported on the discharge MDS, providers can be certain that CMS, MAC auditors and the Office of Inspector General will be auditing providers who are outliers for over or under providing therapy services.

It is imperative for MDS coordinators and those involved with diagnosis coding to receive adequate training and education to accurately select the appropriate ICD 10 code for each resident. For many, an improved understanding and ability to effectively use the IDC-10 crosswalk will also be helpful. All too often, we can become wrapped up and bogged down with our day-to-day responsibilities and hectic schedules and then training and education are put on the back burner. Providers need to make ICD-10 coding training a priority as it directly affects the accuracy of reimbursement under PDPM.

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