Government Payor Reforms Flashcards
What does TEFRA stand for?
Tax Equity & Fiscal Responsibility Act of 1982
What are the 2 things TERFA established?
- The first prospective payment system (PPS) for acute hospital care
- The first utilization review bodies for Medicare called Peer Review Organizations (PROs)
What was the law that created Diagnosis Related Groups (DRGs)?
TERFA
What was the goal of DRGs?
Reduce utilization of inpatient acute care
What does BBA stand for?
Balanced Budget Act of 1997
What did the Balanced Budget Act mandate?
Implementation of a prospective payment system for hospital outpatient services and postacute care providers, such as SNFs, home health agencies, and IRF
Describe what a prospective payment system is?
a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. The payment amount for a particular service is derived based on the classification system of that service (for example, diagnosis-related groups for inpatient hospital services).
What are the 2 types of PPS?
Retrospective
Prospective
Describe a retrospective payment system
The payor knows how much to pay AFTER receiving the bill from the provider
Describe a prospective payment system
The payor knows what will be paid before receiving the bill from the provider for a given condition or length of stay (benefit for the insurer)
Describe why prospective PPS are a benefit from the insure
They can better predict future outlays, making budgeting more accurate
Why was the BBA needed?
DRGs created incentive to transfer to post-acute, so hospitals took advantage of that incentive
Medicare spending for SNF’s rose at an average annual rate of __% between 1990 and 1996.
Why is this significant
23
It proves that hospitals were trying to take advantage of the incentive DRGs created to discharge acute patients to post-acute settings. Hence the need for BBA
How did the paradigm shift following the passing of the BBA in 1997?
Prior to its passing most used a fee for service in which the provider set the price.
Following its passing and the adoption of PPS, Medicare set the price.
What was the goal of BBA?
to reduce Medicare outlays by $116.4 billion through 2002
What were the 4 BBA 1997 PPS’ that were instituted?
- SNF
- OP Rehab
- Home Health
- IRF
The SNF PPS uses a ____ ___ system
case mix
Describe the SNF prospective payment system
There is an all inclusive per diem rate based on patient acuity. No service or discipline can bill separately for services.
How is patient acuity determined?
through a comprehensive assessment of each patient, using the Minimum Data Set (MDS)
What does the MDS aggregate score give us?
the patient’s RUG level
MDS completed on Day _ determines payment for Days 1 through 14.
MDS completed on Day __ determines payment for Days 15 through 30.
MDS completed on Day __ determines payment for Days 31 through 60.
MDS completed on Day __ determines payment for Days 61 through 90.
MDS completed on Day __ determines payment for Days 91 through 100.
5
14
30
60
90
What are the 2 pieces that make up RUG grouping?
- Therapy minutes
- Number of days therapy provided
True or False
Evaluation days and minutes count towards the determination of RUG grouping
False
Because eval days and minutes do not count, what is suggested?
perform at least fifteen (15) minutes of treatment on evaluation day so that day counts toward the five days needed in the assessment period
If the patient falls within the top __ RUG categories they are assumed to be covered by Medicare and quality for the SNF
52
If the patient falls in the bottom __ RUB categories they will be reimbursed as long as the beneficiary meets the coverage criteria
16
If a patient on a SNF requires Part A or B PT, OT, or speech in the hospital, the hospital cannot bill Medicare. Instead what must happen?
The hospital must bill the SNF, who then can bill Medicare
Describe the OP rehab PPS
It is based on a national Medicare Physician Fee Schedule (MPFS) in which individual payments are made when physicians file their claims
What is the home health PPS based upon?
A 60 day episode of care
Describe the home health PPS
60% is paid up front and 40% at time of claim submission after discharge for first episode.
50% paid up front, 50% at time of claim submission for 2nd or more episode within 60 days of beginning of first episode.
What assessment tool must be filled out in home health?
OASIS
How is the final home health PPS payment derived?
Multiply the HHRG by the national payment rate
If the length of stay is short at _ or fewer visits then it results in a Low Utilization Payment Adjustment (LUPA), which is a per visit payment
4
Home health follows the same consolidated billing process as the SNF PPS. Describe how it works
If the patient receiving home health requires OP services, the rehab provider will bill the home health agency, not Medicare
What is the inpatient rehab facility PPS based on?
a Case-Mix Group (CMG)
What is the assessment instrument in a IRF?
IRF-PAI (Inpatient Rehabilitation Facility - Patient Assessment Instrument)
What is the IRF-PAI based on?
the UDS FIM outcome measurement system
In order to be classified as an IRF a facility __% of all patients admitted must fall within 13 diagnostic categories
60
What are the 13 IRF diagnostic categories?
- Stroke
- SCI
- Congenital deformity
- Amputation
- Major multiple trauma
- Fracture of femur (hip fracture)
- Brain injury
- Neurological disorders (MS, motor neuron disorders, polyneuropathy, muscular dystrophy, PD)
- Burns
- various arthritises rustling in significant impairment of ambulation
- Systemic vasculidities
- Severe or advanced osteoarthritis involving two or more weight bearing joints
- Knee or hip joint replacement
What does Medicare part C allow beneficiaries to do?
opt out of traditional FFS Medicare and into managed care plans
What does MMA stand for?
Medicare Modernization Act of 2003
What did MMA establish?
Medicare Part D, which is a prescription drug benefit plan
What does PPACA stand for?
Patient Protection and and Affordable Care Act of 2010
aka Obamacare
What was the major change introduced via the PPACA in 2010?
Independent Payment Advisory Board
What is the Independent Payment Advisory Board in charge of?
developing detailed proposals for methods of slowing the increase of Medicare costs
When are the first recommendations of the IPAB to come?
In 2015
What was the major change introduced via the PPACA in 2011?
Hospital Value Based Purchasing (HVBP)
What did the Hospital Value Based Purchasing (HVBP) used to be referred as?
“Pay For Performance”
What is the HVBP?
A Centers for Medicare Services initiative that rewards acute-care hospitals with incentive payments for the quality of care they provide to people with Medicare
What was the major change introduced via the PPACA in 2012?
The Medicare shared savings Accountable Care Organization (ACO) program began
What is an ACO?
a health system model with the ability to provide, and manage with patients, the continuum of care across different institutional settings, including at least ambulatory and inpatient hospital care and possibly post-acute care
What were 2 major changes introduced via the PPACA in 2013?
- Increase in Medicare hospital payroll tax to 2.35% from 1.45% for high earners (wages over $200,000)
- Medicare bundled payment
What does the bundled payment plan encourage?
doing conservative procedure first
PT-OT-SLP could be a big winner with bundling
What was the major change introduced via the PPACA in 2014?
Individual mandate on purchase of “acceptable” health insurance
What does the individual mandate state?
Individuals were required to maintain a minimum essential coverage every month or pay a penalty.
Essentially what does the individual mandate promote?
That 30+ million Americans will have insurance of some sort that had none previously
What was the major change introduced via the PPACA in 2015?
Employer mandate
What does the employer mandate state?
all businesses with 50+ full-time equivalent (FTE) employees must provide health insurance or pay a $2,000 per employee penalty
In what year will the Medicaid bundled payment demo end?
2016
In what year will the Medicare bundled payment demo end?
2018
In what year will the “doughnut hole” coverage gap in Medicare prescription benefit be phased out?
2020
