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PDGM And Therapy Services

Physical Therapy

PDGM is upon us and we all have been preparing for months.  So has the nursing home industry, were PDPM went into effect in October 2019.  According to Home Health Care News, “Of those Skilled Nursing Facilities (SNF) operators responding to the survey reported laying off therapy staff, a sizable portion said cuts accounted for between 21% to 40% of their workforce.”  This may be a predictor of things to come for the Home Health industry.  However, we must be cautious in how we reduce or reorganize care.  As Home Health News pointed out in the article below, there are cautions that must be considered.  Also, links to other articles by Home Health News, are very informative and resourceful.  Staff cutting will be inevitable, careful planning must be in place.

“No home health companies have publicly acknowledged cutting their therapy staff as of yet, but, HHCN has received multiple emails from individuals claiming to be therapists who have been hit with reduced pay or hours.

Generally, home health providers have freely delivered therapy over the years under the current Prospective Payment System (PPS), often using the service to drive revenues. From 1997 to 2016, the portion of home health therapy visits skyrocketed from 10% of all visits to 39%, Medicare data shows.

That sudden spike is why PDGM restructures therapy utilization by making reimbursement tied to patient characteristics instead of volume. Many providers understand that shift but worry it will prompt an over-correction to therapy utilization, causing patient outcomes to suffer as a result.

“I think some home health providers are simply not going to be able to support the financial cost of delivering that [therapy] service. It’s going to be so misaligned with revenue for those patients,” April Anthony, CEO of Encompass Health’s (NYSE: EHC) home health and hospice segment, previously told HHCN “I see the attempt CMS was making, but, again, I’m anxious they’ve over-corrected in the case of therapy.”

A 2018 study found that people who received more than 2.3 visits of therapy on a weekly basis had 82% lower rates of hospital readmission compared to those who did not. Similarly, a 2011 study found that heart failure patients who utilized physical therapy saw significant functional improvements compared to those who did not.

“Under PDGM, under-utilization of therapy may become a bigger problem than over-utilization,” Dr. Jason Falvey, a postdoctoral fellow at the Yale University School of Medicine, said at an October industry conference. “If you short therapy on the front-end, you end up paying for it in the back-end.”

Even if Medicare-reimbursed health care providers aren’t laying off therapists, they may still be reducing their pay or hours worked.

For example, more than half of the SNF respondents in the SNN poll — about 53% — said they had switched some therapy staff to PRN status, a term that refers to as-needed labor as opposed to steady hours.

To avoid negative outcomes after PDGM, providers that decrease therapy staff may turn to more creative, cost-effective alternatives

That may include a greater reliance on telehealth and telemonitoring tools, when appropriate. Alternatively, it may even include using more therapy assistants, who can often be sent into patients’ homes for less.”

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