What SLPs Need to Know About the New Medicare Home Health Payment Model

PDGM Facts and Details

On January 1, 2020, home health agencies (HHAs) will implement the patient-driven grouping model (PDGM) for Medicare reimbursement, which bases payment for patients with speech-language pathology needs on their clinical characteristics. Here’s what speech-language pathologists (SLPs) need to know!

The transition to PDGM should not lead to the end of employment for SLPs in HHAs.

If HHAs implement PDGM appropriately, they will empower SLPs to identify and treat patients who need clinically necessary speech-language pathology services rather than count the number of therapy visits provided to each patient. HHAs who state that SLPs are being laid off because of the transition to PDGM are not being transparent about the rationale for terminating therapists. In most cases, HHAs that plan well for the transition and appropriately assess the role of SLPs will not need to terminate employees.

Patient needs drive changes to the HHA reimbursement model.

Under the previous system (resource utilization groups, or RUGs), the number of therapy visits drove payment. Some HHAs manipulated treatment time in order to maximize reimbursement. HHAs that provided excess therapy in order to maximize reimbursement may struggle to maintain staffing because they had disproportionately inflated their staffing needs. Alternatively, such HHAs may establish similarly manipulative administrative mandates to maximize profit under PDGM by providing as little therapy as possible. SLPs should always reinforce the ethical and legal obligation to provide therapy based upon the clinical needs of the patient as opposed to administrative mandates for the purpose of maximizing reimbursement.

Medicare and PDGM are not changing who can perform therapy.

Each facility makes determinations on how to use therapy clinicians in compliance with state licensing laws. If your facility tells you that Medicare no longer allows SLPs to perform certain types of services, that is an incorrect interpretation of Medicare policy. For example, Medicare does not dictate that only occupational therapists (OTs) or only SLPs can provide cognition or swallowing services.

Medicare does not require mandatory evaluations for every patient.

A brief assessment or screen can help you determine if a patient needs a full evaluation. Your clinical judgment and the needs of the patient remain paramount in the decision-making process. Administrative policies that mandate an evaluation and at least one treatment are inappropriate, unethical, and fraudulent when not clinically necessary.

Medicare has not changed the underlying obligation that HHAs must provide all medically necessary services to patients.

In the home health prospective payment system proposed rule for calendar year 2020, CMS clarified its expectations: HHAs must deliver all medically necessary services to patients, regardless of a patient’s clinical grouping. CMS explicitly stated:

"While these clinical groups represent the primary reason for home health services during a 30-day period of care, this does not mean that they represent the only reason for home health services. While there are clinical groups where the primary reason for home health services is for therapy (for example, Musculoskeletal Rehabilitation) and other clinical groups where the primary reason for home health services is for nursing (for example, Complex Nursing Interventions), home health remains a multidisciplinary benefit and payment is bundled to cover all necessary home health services identified on the individualized home health plan of care. Therefore, regardless of the clinical group assignment, HHAs are required, in accordance with the home health CoPs at § 484.60(a)(2), to ensure that the individualized home health plan of care addresses all care needs, including the disciplines to provide such care."

Medicare will pay for therapy services regardless of the source of admission (e.g., community or institution).

PDGM includes payment for therapy services for patients admitted from either an institution (e.g., hospital) or the community. In reviewing 30-day periods of care for patients with an institutional admission source, CMS found that such patients have higher resource use than do those patients admitted from the community. Therefore, during the first 30 days of the home health episode, CMS pays a higher rate for an institutional admission than for a community admission.

Medicare pays for a full 60-day episode of care.

Although CMS reduces payment after the first 30-day payment period, payment continues across the entire 60-day episode. SLPs should deliver care based on patient needs. There are times that the SLP can complete care during the first 30-day payment period; however, care continues for up to 60 days when needed. Physicians may recertify some patients for subsequent 60-day episode(s) based on their continued need for skilled services.