Navigating PDPM: The Right Rehab Partnership Yields Great Value

By Guy Cowart, Consonus Rehab President

It’s no secret that 2019 will bring tremendous change to our profession—maybe more than most of us have ever experienced. At Consonus, we’re in the process of meeting with current and potential customers to share insights and strategies around Patient-Driven Payment Model (PDPM) planning.

Providers have a lot of questions, such as:

  • How will PDPM affect our overall financials compared to RUGS?
  • What about our pricing structure?
  • How will PDPM affect our delivery model?

These are great questions, with enormous implications. Here’s what we’re able to share so far.

Impact of PDPM vs. RUGS

The best information we have on the expected impact of PDPM vs RUGS is drawn from what CMS published, and is based on 2017 data. To date, we have seen about half our partners faring better under PDPM, and half experiencing revenue deficits.

Pricing structure

It is still too early for us to provide firm pricing, as we’re completing our analysis of the impact of group and concurrent on our cost of service. It’s safe to say, however, that the impact will vary by facility according to census, as we will have limited ability to lower our cost for facilities with a low Medicare census.

I think most rehab companies are exploring various pricing models. Whether it’s per minute, per diem or a percentage of case mix, I’ve heard them all and am sure there will be other creative ideas. What’s important is that the foundation of any pricing model and amount of rehab minutes delivered continue to protect the patient experience and outcomes.

Delivery model

Being based in Portland, Ore., we are in a 65 percent managed care market and currently use group and concurrent with multiple payers. This gives us a pretty good idea of the impact of utilization to outcomes, and we’re testing various delivery models to see how much we can lower our cost and still maintain outcomes.

Final thoughts

Just because rehab no longer drives revenue, I think it’s important for providers to be aware of the possible implications of asking their rehab company to drop minutes too much. Lowering minutes to the point that the patient experience and outcomes are affected is a sure-fire way to dry up your referrals, and could lead to even further reductions in future rehab payments. Patients admitted for rehab want to be in the gym, plain and simple. Although CMS didn’t tie rehab reimbursement directly to outcomes, as rehab providers we would welcome the opportunity to measure the value we bring to each patient’s stay.

Rehab companies are working hard to prove their value beyond the number of minutes they deliver to each patient. At Consonus, for instance, we’ve been heavily focused on collaborating with our partners to implement Section GG (See additional training resources) and are focused on supporting quality measures and coding accuracy. There’s a continued need for rehab providers to support alternative payment model initiatives, and many are now providing customers with data analytic tools that help prove value to referral sources and build market share.

As we navigate together all the uncertainty 2019 will bring, one thing is certain—choosing the right rehab provider will yield great value, despite the changes in reimbursement.