Centers for Medicare and Medicaid Services Final Rule for FY 2014

Joan McCarthy

The Final Rule-Skilled Nursing Facility Prospective Payment System – (SNF/PPS) and Other Reminders

Final Rule for FY 2014 CMS Update for Final Rule for FY 2014. This is a broad overview of the changes that will be put in place on October 1, 2013. Providers are encouraged to read that actual text of the Final Rule as it contains many references to past changes and focuses on items that may be targets for audits that will certainly increase as CMS tries to limit fraudulent practices and preserve Medicare and Medicaid programs for our disabled and elderly population. Centers for Medicare and Medicaid Services (CMS) has issued the Final Rule for FY 2014 due to take effect in SNFs across the country on October 1, 2013. The following items are part of the FY 2014 Rule:

Revising and Rebasing the SNF Market Basket Index
CMS is using data from the 2010 Medicare allowable total cost data which includes five new cost categories to determine payments for services starting October 1, 2013. Once again we are reminded of the importance of accurate Cost Report information as this information drives much of the payment rate setting. There is an aggregate 1.3% increase in payments for FY 2014. Because of wage index and locality the actual increase for a facility can range from 0.06% to over 2.8% in some locations. We are also reminded of the sequestration cuts to Medicare of 2% that will affect payment through 2014 unless Congress acts to change the ruling.

ICD-9-CM AIDS add-on
Effective with the compliance date for transitioning to ICD-10-CM diagnosis codes, the new code for AIDS will be B20 not the current ICD-9-CM code 042. This change as noted will take place for services provided starting October 1, 2014.

Administrative Presumption
As was defined  in the FY 2011 SNF PPS update notice, a resident who classifies into one of the upper 52 RUG categories on the initial 5 day PPS assessment, automatically classifies into meeting the SNF level of care definition. This presumption includes the time up to and including the Assessment Reference Date (ARD). We are reminded that documentation must show that the services are reasonable and necessary to treat a beneficiary’s condition. Beneficiaries classified into the lower 14 categories are not presumed to either meet or not meet the SNF definition of skilled care.

Consolidated Billing
There was further discussion on the broader categories of chemotherapy, and chemotherapy administration and customized prosthetic devices. There were no changes here except to reiterate that providers need to be aware of the “billed” HCPCS codes when Part A beneficiaries receive certain services from other providers. The Final Rule reminds providers that radiation therapy is excluded but only when provided in a hospital or CAH setting. There was also discussion about surgical debridement codes that were incorrectly listed as “included” in Consolidated Billing codes. These are physician codes that should be listed as exclusions. Providers should watch for these CPT codes: 11042, 11043 and 11044. These ambulatory “surgical codes” are often costly and can be missed when residents receive these services off site.

New MDS 3.0 Item
A major change to the MDS will take place as of October 1, 2013 — the addition of item O0420 on the MDS. This item captures the total number of distinct calendar days that residents receive therapy services across all disciplines during the 7 day look- back period. This is not a policy change but a data collection change that may affect classification into Rehab Medium or Rehab Low. In the past, calculation of the RUG score did not differentiate how many actual calendar days of therapy were provided; for example, Rehab Medium could be calculated if PT was provided 3 days M-W-F and OT was provided 2 days M-W. Under the new calculation, only 3 calendar days of therapy were actually provided and Medicare requires at least 5 days of therapy for the RUG level. This change should not affect the actual provision of therapy but providers are reminded that documentation should support the need for therapy across 5 days.

Feel free to contact me for any questions or comments, at jmccarthy@provinet.com.
Joan McCarthy MJ, LNHA, RAC-CT

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