Harmony Healthcare Blog

The Votes Are In For RUG-IV

Posted by The Harmony Team on Dec 14, 2010 9:53:00 AM

The Votes Are In For RUG-IV

During the CMS Open Door Forum, December 9, 2010 Sheila Lambowitz, Director of the Division of Institutional Post Acute Care for the Centers for Medicare & Medicaid Services stated "We're not going to have to reprocess [RUG-IV] claims," "We're not going to have to change to a new [temporary]  grouper."  She went on to say that passage of the bill "gives us some clarity to move forward and work on transition issues and make sure we have the RUG-IV and MDS 3.0 system working properly."

Additionally this legislation extends Medicare's Therapy Cap Exception process until December 31, 2011. Therapy caps apply an annual cap per beneficiary on expenses incurred for both outpatient physical therapy and speech therapy services combined and a separate cap for outpatient occupational therapy services under Medicare Part B. For CY 2011, the therapy cap amount has increased slightly from $1,860 to $1,870. 

The Medicare and Medicaid Extenders Act of 2010 also eliminates the expected 25% reduction in Medicare payments to physicians that was to be initiated in January 2011.  This is great news for the LTC industry. 

"This agreement is an important step forward to stabilize Medicare, but our work is far from finished," President Obama said in a statement. He added that it's time "for a permanent solution that seniors and their doctors can depend on."

Additional information on this soon to be law can be obtained on the United States Senate Committee on Finance site: http://finance.senate.gov/legislation/details/?id=9f97aa2e-5056-a032-52d4-8db158b12b11

CMS Speaks: CMS has posted the following guidence for facilities regarding coding Section A, 0310E to report if the assessment is the fist assessment since the most recent admission.

MDS 3.0 Coding Clarification for Item A0310E - CMS has re-evaluated the guidance outlined in the "MDS 2.0 to MDS 3.0 Transition Document" dated October 2010 for the coding of item A0310E. The transition document indicated that the item should be coded as "1" for the initial MDS 3.0 assessment for all existing residents; however, this guidance was overlooked on many of the assessments that were submitted.

During the November 9, 2010 National Provider Call direction was provided indicating that assessments that were coded as a "0" would need to be corrected and resubmitted.

CMS has reconsidered the matter and has concluded that providers Do Not need to submit corrected assessments where item A0310E may have been miscoded. Providers should follow the directions outlined in Chapter 3 Section A of the MDS 3.0 RAI Manual for the coding of A0310E from this point further.


Topics: CMS, MDS 3.0, RUG-IV;

MDS 3.0 Staff Interviews

Posted by The Harmony Team on Dec 7, 2010 3:18:00 PM

MDS 3.0 Staff Interviews

Late life depression affects about 6 million Americans age 65 and older, but only 10% receive treatment for depression. The likely reason is that the elderly often display symptoms of depression differently. Depression in the elderly is also frequently confused with the effects of multiple illnesses and the medicines used to treat them. Studies of nursing home patients with physical illnesses have shown that the presence of depression substantially increases the likelihood of death from those illnesses.

The MDS 3.0 introduces facilities to the PHQ-9© resident interview. Although most patients are able to successfully complete the interview process, a patient may be unable to participate in an interview or partially complete the interview which results in an incomplete interview. The patient interview for mood is successfully completed when the patient answered the frequency responses of at least 7 of the 9 items on the PHQ-9©.

If symptom frequency is blank for 3 or more items, the interview is deemed not complete. The total severity score should then be coded as "99" and the staff assessment of mood should then be conducted. Alternate means of assessing mood must be used for patients who cannot communicate or refuse or are unable to participate in the PHQ-9© patient mood interview. This ensures that information about their mood is not overlooked.

The assessor should interview staff from all shifts who know the patient best. The scripted interviews with staff who know the patient well will provide critical information for understanding mood and making care planning decisions. Ask the staff member being interviewed to select how often over the past 2 weeks the symptom occurred. Use the descriptive and/or numeric categories on the form (e.g., "nearly every day" or 3 = 12-14 days) to select a frequency response to determine how often over the past 2 weeks the symptom occurred. The frequency response determines the total severity score. If frequency cannot be coded because the patient has been in the facility for less than 14 days, talk to family or significant other and review transfer records for information to select a frequency code. The assessor should also take into  consideration observations of the patient during attempts to complete the patient interview and the documentation in the patient's record.

In addition to clinical uses of the PHQ-9©, the total severity score is used to determine the patient's nursing RUG score for Medicare reimbursement. CMS values the resources facilities utilize to care for patients with depression as reflected in an incremental increase in the Medicare RUG for patients who are depressed. If the PHQ-9© is 10 or greater and a patient qualifies for a Clinically Complex or Special Care category, a depression add on is reflected in the RUG by a 2 at the end of the RUG (CE2 versus CE1). It is important that the staff assessment be accurately completed in order to receive reimbursement for the resources utilized by the facility to manage depression.

MDS 3.0

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Topics: MDS 3.0, MDS 3.0 Staff Interviews

ADL Coding and Scoring for MDS 3.0

Posted by The Harmony Team on Nov 30, 2010 9:21:00 AM

 The CNA: A Critical Piece of the MDS 3.0 Puzzle

MDS 3.0 accuracy, meaningful assessment and CarePlan as well as appropriate reimbursement begins at the bedside with the certified nursing assistant (CNA). Harmony Healthcare recognizes the importance of tapping into the knowledge that only the frontline staff has of your residents. This is an integral piece to the MDS 3.0 process for ADL Coding and Scoring.  Through Harmony's MDS program specially designed for CNAs and other frontline staff, these team members will learn their role in MDS 3.0 and why their input is essential to ensure an assessment that truly reflects the ADL Coding and scoring of the resident. The sections discussed during these sessions will include activities of daily living, mood, behavior and pain. These interactive and informative sessions will foster assessment accuracy, team building and a better understanding of the new process for the frontline staff.

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Topics: MDS 3.0, CNA, ADL Coding and Scoring

RUG-IV to Hybrid RUG-III Analysis

Posted by The Harmony Team on Nov 23, 2010 10:34:00 AM

 Most facilities despite the transition issues, have completed the Medicare Part A billing for October 2010. Using the billed RUG-IV days from several facilities, Harmony has prepared a Hybrid RUG-III (HR-III) analysis using a formula to transfer the RUG-IV days to the Hybrid RUG-III grouper.  The HR-III analysis reflects extrapolated days using a very conservative formula.  The outcome of the % difference in the Medicare Part A Rate and Medicare Part A Revenue will differ based on each facility and the type of patients treated.  For example, if a facility provides in-house IV fluids this could increase the reimbursement under the HR-III grouper.  Conversely, facilities that have been providing care to patients who require isolation for active infectious disease will need to budget for a steeper financial pay back.

A key factor is that the majority of SNFs have the highest percentage of Medicare Part A Days in the Rehab categories.  The extrapolation of Rehab billed days between RUG-IV and HR-III is very similar based on the fact that Medicare did not change any of the minute requirements.  The nursing RUG categories typically comprise a small percentage of the RUG days, which usually falls between 10%-15%.  Calculation of the Hybrid RUG-III classifications can be fairly accurately done with Rehab scores.  The nursing scores which were reported by the facilities for RUG-IV were very conservatively calculated to HR-III scores.  To obtain the most accurate Hybrid RUG-III calculation of monthly revenue, Harmony can provide an on-site review of all MDS assessments and days billed for the month to determine how each score will be targeted, either for a reduction or increase in reimbursement. 

Harmony provides further insight into comparison of RUG-IV Revenue vs. Hybrid RUG-III Revenue.

A patient who requires isolation for active infection, coded on the MDS 3.0 under RUG-IV with an ADL score between 2-16 will yield an Extensive Service 1 score (ES1).  This same patient would not yield an Extensive RUG score under the Hybrid RUG-III grouper.  Under Hybrid RUG-III, the MDS software will look for another clinical qualifier to classify the assessment into a nursing RUG category.  If this patient received Respiratory therapy, then the MDS 3.0 would yield a HR-III score of Special Care (SSB). 

Sample based on Massachusetts rates for Essex County:


  • ES1 (coding Isolation) Rate:  $493.71 x 14 days = $6,911.94 (RUG-IV) 
  •  SSB (coding Respiratory Therapy) Rate: $360.57 x 14 days = $5,047.98 (HR-III)
  • $ Impact Difference: ($1,863.96) paid back to Medicare
  • % Difference:  27%

Harmony is pleased to report that of the analysis completed, the overall % reserve has calculated between 8 - 12%. This has been received with much relief compared to the originally forecast 20% reserve.

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Topics: RUG-IV;, RUG-III Hybrid, RUG-IV to Hybrid RUG-III Analysis

Prevent Rejected Claims on Medicare Part B Therapy Billing

Posted by The Harmony Team on Nov 16, 2010 6:39:00 PM

Prevent Rejected Claims on Medicare Part B Therapy Billing


Providers must be aware of Transmittal 2091 from Pub 100-04, Medicare Part B Claims Processing which creates new edits in Medicare Part B claims processing systems to prevent rejected claims on Medicare Part B billing of therapy-related codes on institutional claims.


Modifiers are used to identify therapy services whether or not financial limitations are in effect. When limitations are in effect, the CWF tracks the financial limitation based on the presence of therapy modifiers. Providers /suppliers must continue to report one of these modifiers for any therapy code on the list of applicable therapy codes.


Contractors also edit to ensure that the therapy modifiers are present based on revenue codes 042X, 043X, or 044X. Claims containing revenue codes 042X, 043X, or 044X without a therapy modifier GN, GP, or GO are returned to the provider. Additionally, contractors ensure that revenue codes and modifiers are reported in the following combinations:


  • Revenue code 42x (physical therapy) lines may only contain modifier GP
  • Revenue code 43x (occupational therapy) lines may only contain modifier GO
  • Revenue code 44x (speech-language pathology) lines may only contain modifier GN.

Medicare Contractors edit to ensure that more than one GN, GO or GP are not reported on the same service line on all institutional claims. Contractors will return to the provider any claim that reports more than one of these modifiers on the same line.  

Contractors return to the provider institutional claims that contain lines with any other combinations of these revenue codes and modifiers.


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Topics: Medicare Enhancement, Medicare Part B Billing

Care Area Assessments Part II

Posted by The Harmony Team on Nov 9, 2010 10:14:00 AM

More About Care Area Assessments The first step in documenting Care Area Assessments findings is to describe the nature of the issue or condition. This may include presence or lack of objective data and or subjective complaints. In other words, what are the details of the problem for this resident? Medical history is reviewed and the relevant history related to this specific care area is detailed. This may include active and historical diagnoses and conditions as well as a brief summary of what led to admission to the SNF. Potential or actual causes and contributing factors to consider when assessing for the care area triggered should be detailed. This includes complications affecting or caused by the care area for this resident. The next step is to identify risk factors that arise because of the presence of the condition that affects the staff's decision to proceed to care planning. This may include a statement of how your findings may potentially impact the resident given. What is the patient at risk for given your assessment of why these MDS items triggered (at risk for_____). What do standards of clinical practice and relevant research findings indicate when a resident has this condition or issue? This may include outcomes of other standardized assessments (Nursing Assessments). The specific assessment, date completed and score should be stated. Next, identify factors that must be considered in developing individualized care plan interventions. This information justifies the decision to proceed or not proceed to care plan for the individual resident. Resident preferences, history of the condition, and the individualized impact of the issue on the resident should be considered. For example, a patient may be edentulous for many years yet has had no nutritional or swallowing issues. Although this triggered, these factors must be considering when determining if there is a need to proceed to care plan as a problem. The final step is to determine if there is a need for referrals or further evaluation by appropriate health professionals. This may include medical professionals outside the facility (ophthalmologist, psychiatrist, dentist) or facility staff (rehabilitation therapies, social services). The Care Area Assessment facilitates the care plan decision making, but it may or may not represent a condition that should be addressed in the care plan. The goal of completion of the Care Area Assesment is to assess the resident to determine if there is a problem that must be addressed and therefore proceed to care plan. The care plan then addresses these factors with the goal of promoting the resident's highest practical level of functioning. This care plan may be developed with a goal of improvement where possible or maintenance with prevention of avoidable declines. Pain and Return to Community are two new areas to be addresses since the introduction of MDS 3.0. Harmony will discuss the Pain Care Area Assessment in detail during our upcoming Pain Seminar.

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Topics: care area assessments

Understanding the New Care Area Assessments

Posted by The Harmony Team on Nov 2, 2010 2:18:00 PM

Understanding the New Care Area Assessments

First a quick note about last week's CMS SNF Open Door Forum: Regarding the Hybrid RUG-III System vs. RUG-IV, CMS is paying close attention to any acts of Congress aimed at repealing the RUG-IV delay. If the repeal does not go through then CMS will have to institute the Hybrid RUG-III system. CMS has begun development of the Hybrid RUG-III grouper in the case that the Senate does not pass the repeal. As we wait for the Senate to make a final decision, Harmony recommends the SNF continue to reserve funds from RUG-IV payments to offset Hybrid RUG-III adjustments in the Spring of 2011.  

Care Area Assessments: The Care Area Assessment is similar to a Resident Assessment Protocol (RAP) from MDS 2.0.

The Care Area Assessment process is a decision facilitator, which means it should lead to a more thorough understanding of the areas of concern that have been triggered by the MDS for further review. The MDS alone is not a comprehensive assessment. The MDS is used for preliminary screening to identify potential resident issues, conditions, strengths, and preferences. The Care Area Assessmentrepresents the assessment based on what was triggered by the MDS for the Care Area Assessment for review. The Care Area Assessment expands your assessment findings from the MDS, and then "charts your thinking."

The first step in the process of completing a Care Area Assessment is to identify what MDS items triggered and the Care Area Assessment and why. This can be done through review of Chapter 4, although frequently MDS software will detail these items. It is helpful to determine why these MDS items triggered the Care Area Assessment in order to focus your assessment and ensure that what triggered is actually assessed. Different types of triggers can change the focus of the Care Area Assessment review. There are four types of triggers:

1.      Potential Problems: These factors suggest the presence of a problem that warrants additional assessment and consideration of a care plan intervention.

2.      Broad Screening Triggers: These factors assist staff in identifying hard-to-diagnose problems. Because some problems are often difficult to assess in the elderly nursing home population, certain triggers have been broadly defined and consequently may have a fair number of false positives (i.e., the resident may trigger a Care Area Assessment that is not automatically representative of a problem for the resident).

3.      Prevention of Problems: These factors assist staff in identifying residents at risk of developing particular problems.

4.      Rehabilitation Potential: These factors are aimed at identifying candidates with rehabilitation potential.

Harmony will continue this discussion in next week's newsletter. Harmony Regional Consultants can provide sample Care Area Assessments during monthly site visits. 

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Topics: CMS, RUG-IV;, New Care Area Assessments, RUG-III Hybrid

RUG-IV vs. Hybrid RUG-III Payments

Posted by The Harmony Team on Oct 26, 2010 12:16:00 PM


RUG-IV vs. Hybrid RUG-III Payments


Financial Recommendation: Reserve Funds for the inevitable adjustment of your MDS RUG-IV Payments and reduction to Hybrid RUG-III Rates, in the Spring of 2011.


CMS has decided that Medicare Part A payments during this transition period will be at the RUG-IV rate. There is a significant difference between the RUG-IV and Hybrid RUG-III rates. Therefore, it will be prudent for each facility to be aware that at some point, the Fiscal Intermediary (FI) will be making adjustments to the RUG-IV payments. The facility should not plan on a finalization of payments until they have worked through the payment adjustments, possibly as late as the Spring of 2011. At this time, they plan to review and adjust all payments made prior, and reconcile them to the Hybrid RUG-III rates. As you are all aware, adjustments to Medicare Part A payments can be undertaken by the reduction, or complete take back, of future payments to meet what they have determined is your final payment obligation.


Harmony recommends facilities consider the possibility of creating or utilizing some type of revenue "slush" fund to avoid this difficulty meeting daily financial obligations.  We estimate that the best plan will be to set aside or reserve approximately 20% of your RUG-IV revenue to ensure that you will have adequate funds to meet your financial obligations once your FI begins the adjustment of your payments to the Hybrid RUG-III rates in 2011.


Harmony has devised a methodoligy for calculating and tracking the actual Hybrid RUG-III rate and revenue differential for FY 2011.  Harmony is sharing this policy with annual clients and is available to assist facilities in calculating this monthly equation.


Harmony Consultants are available should you have any questions, regarding the payment and adjustment process. You may contact Sue Lounsbury our Regional Billing/Financial Consultant, your Harmony Regional Consultant, or our corporate office, should you have any questions and/or require assistance. Lastly, Harmony recommends that the facility get in touch with the FI and/or provider service representative for clarification of Medicare Part A payments, and/or interpretation of future Remittance Advice documentation.  

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Topics: RUG-IV;, Hybrid RUG-III

CMS will convert to a new electronic version for claims processing

Posted by The Harmony Team on Oct 19, 2010 1:14:00 PM

Billing/Financial Considerations


Please be aware that CMS will be converting to a new electronic version for claims processing.  Currently your 837 electronic institutional claim is in a (ASC) X12 version 4010A1 format, and they will be updating to a (ASC) X12 version 125.


This new formatting will be the responsibility of your software vendors to update your software systems to accommodate the version changes.  However, Harmony recommends that you always make sure that they are aware of these type of changes and deadlines. (Feel free to send this document on to them for reference.)


The timeline for the new 5010 version is as follows:


·        Effective Date of the regulation: March 17, 2009

·        Level I Compliance by: December 31, 2010

·        Level II Compliance by: December 31, 2011

·        All covered entities have to be fully compliant on: January 1, 2012


Level I compliance means "that a covered entity can demonstrably create and receive compliant transactions, resulting from the compliance of all design/build activities and internal testing."


Level II compliance means "that a covered entity has completed end-to-end testing with each of its trading partners, and is able to operate in production mode with the new versions of the standards."


HHS permits dual use of existing standards (4010A1 and 5.1) and the new standards (5010 and D.0) from the March 17, 2009, effective date until the January 1, 2012 compliance date to facilitate testing subject to trading partner agreement.


As part of the new formatting to version 5010, CMS has finally developed a way to both indicate and send additional documents required for claims processing.  There is a certain loop or segment in your electronic claim that will include an indicator that additional documentation required for processing of the claim will be forthcoming.  The submission of the extra field indicating that there will be follow-up additional documentation and the (necessity to send the documentation) will go into effect in April 2011.


Again, it will be the responsibility of your software vendors to include this segment in the electronic claim, and also to indicate to you how and where in the software you will access it, for use when necessary.


Unfortunately, there is still no direct electronic way to include the documents yet, so they must be faxed or mailed to CMS. However, CMS has set guidelines and deadlines for their transmission. They have also developed a face-sheet to accompany the additional documentation, and it must be completed both timely and exactly as CMS wants it or they will deny the additional documentation, and process the claims without considering it.


Harmony has a Financial Consultant dedicated to providing facilities with this and additional information. Sue Lounsbury, Billing/Financial Consultant, provides unique consulting visits to address all your Payable and Receivable needs.  Sue will be presenting several Webinars discussing billing for MDS 3.0 and RUG-IV this Fall. 


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MDS 3.0 Section O: Coding Isolation

Posted by The Harmony Team on Oct 12, 2010 11:24:00 AM

MDS 3.0 Section O: Coding Isolation


The Centers for Medicare and Medicaid Services (CMS) has clarified the requirement to code O0100M, Isolation or Quarantine for Active Infectious Disease, on the Minimum Data Set, version 3.0 (MDS 3.0) as the following:


Code only when the resident requires strict isolation or quarantine alone in a separate room because of active infection (i.e., symptomatic and/or have a positive test and are in the contagious stage) with a communicable disease, in an attempt to prevent spread of illness. Do not code this item if the resident only has a historyof infectious disease (e.g., MRSA or C-Diff with no active symptoms), but facility policy requires cohorting of similar infectious disease conditions. Do not code this item if the "isolation" primarily consists of body/fluid precautions, because these types of precautions apply to everyone.


Additional information related to types of precautions: Transmission-Based Precautions must be considered regarding the type and clinical presentation related to the specific communicable disease. The three types of transmission-based precautions are contact, droplet, and airborne. More information related to the types of transmission-based precautions can be found in the 2007 Guideline for Isolation Precautions: Preventing Transmission of Infectious Agents in Healthcare Settings http://www.cdc.gov/ncidod/dhqp/pdf/guidelines/Isolation2007.pdf.

Harmony Healthcarehas received many questions regarding whether or not residents with specific conditions are eligible for coding Isolation in Section O. There are key issues to focus on when determining whether or not to code this item on the MDS. First, the interdisciplinary staff, especially the infection control specialist and the attending physician, need to document why the resident requires strict isolation in a private room. One thing to consider is whether or not the resident's needs could be met in a semi-private room. If the resident's needs could be met in a clinically appropriate way in a semi-private room, Harmony suggests that isolation not be coded on the MDS 3.0.

Prepared by: Jen Pettis, RN, WCC, RAC-MT 

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Topics: MDS 3.0, MDS 3.0 Section O

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