05/15/2019

PDPM and Medicaid

States that rely on some version of RUGs for case-mix adjustments have begun to raise concerns about the transition to the Patient-driven Payment Model (PDPM), which will include a phase-out of RUGS IV. The Centers for Medicare & Medicaid Services (CMS) has shared limited guidance, including some information beginning on page 39 of the FAQ document that was updated in April.

LeadingAge shared that CMS recently shared the following pertaining to the optional state assessment, a tool developed to help states that rely on RUGS bridge the divide between payment systems:

"We're in the process of determining when and how to add the items to the OBRA assessments that would permit states to collect the data necessary for contemplating a transition to PDPM. Additionally, CMS plans to maintain support for the optional state assessment (OSA) until such time as states have collected the necessary data and are able to consider such a transition. The one caveat is that the OBRA assessments, likely as of October 1, 2020, will no longer be able to support calculation of legacy HIPPS codes. This will mean that states that continue to use these legacy models will need to rely on the OSA to classify patients under the RUG-III/IV models."

LeadingAge has reached out to CMS and the National Association of Medicaid Directors and will continue to share updates with states as they become available. (LeadingAge)