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Defining Resource Utilization in Post-Acute Care

Written by: Darlene D'Altorio-Jones (1959-2015) on Tuesday, May 19, 2015 Posted in: Inpatient Rehab

Every year at this time, CMS issues its proposed rules for how providers will operate and get paid under Medicare. Changes are inevitable and this year’s issue continues to drive home the requirement to submit additional information to feed Congress and policy makers the data needed to figure out exactly what they are paying for in post-acute care.

The IMPACT Act of 2014 requires the submission of standardized data by Long-Term Care Hospitals (LTCHs), Skilled Nursing Facilities (SNFs), Home Health Agencies (HHAs) and Inpatient Rehabilitation Facilities (IRFs), and these requirements are beginning to appear in the proposed rules.

While providers are focused on meeting requirements to report data elements directly affecting their payment, considering what is proposed for other PAC providers gives insight to how future rule-making may affect how they will be operating in the future. One such example is the IMPACT Act requirement to report resource utilization. While IRFs and LTACH proposed rules do not specifically address these requirements, the proposed rule for SNFs outlines how CMS has interpreted what Congress intended when mandating reporting the resources used in patient care:

“A facility must be administered in a manner that enables it to use its resources effectively and efficiently to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident.”

Specifically, the proposed rule establishes categories of work employees perform each day and requires the provider to electronically submit payroll data associated with each category.

PAC providers have adopted a multitude of systems and methodologies to calculate and staff their facilities based on the care needs, volume and acuity of the patients they treat. Staffing usually results from an interpretation of these factors, then by applying some calculation of productivity to produce the number of FTEs (employees) required. Getting it correct is a constant debate among all concerned.

The issue of “direct” or “patient care hours” has been the gold standard for managers to communicate staffing requirements to administration and finance. Accountability for staffing effectiveness has been expressed by patient or employee satisfaction survey and references to budget variance.

Now, CMS has proposed that skill, tasks, experience and tenure are all inclusive in payroll data for each employee and those metrics are valid, verifiable and auditable. All combined, for CMS purposes, hours worked yield hours of care provided when reported by categories of work per employee. And, for facilities who staff by contract or agency, reporting by associated work category for these workers would be required to account for staffing resources. Employee, contract or agency will all be reported simultaneously by the same system.

This proposed rule would implement the new requirements as a Condition of Participation for the Medicare or Medicaid programs. CMS believes the new collection and reporting of staffing data should enable greater insight on the relationship between staffing and quality, and can be used to inform future programs or policies.

Public comment is welcomed through June 19, 2015.