The Minimum Data Set (MDS) 3.0 has never been more important to the financial well-being of nursing homes. It has a major effect on Medicare payments, various Quality Measures (QMs) and the Five-Star Rating System created by the Centers for Medicare and Medicaid Services (CMS).
MDS assessments play a major role in establishing payment levels for Medicare Part A covered post-acute care services through Fee-For-Service (FFS) and managed care. The Resource Utilization Groups (RUG) score, a measure of resident acuity is derived from the Activities of Daily Living and Physical Functioning sections of the MDS.
If a provider inaccurately completes its MDSs and this has the effect of creating an overpayment, the facility is subject to audit by federal and state authorities, and may be required to repay not only the amounts overpaid, but also interest and penalties if the facility knowingly submitted inaccurate claims. A facility that has been audited and had overpayments identified is often more likely to be audited in the future.
Another danger related to inaccurate MDS assessments – perhaps a more insidious one – is under-coding a resident’s clinical and functional status. Under-coding means that the MDS does not reflect all the services needed or provided; essentially the facility is giving services away while incurring the costs of providing these same services. This can obviously lead to significant financial disruption and the need to take cost reduction efforts or other measures to try to make up for the lost revenues.
There are a multitude of MDS 3.0 based QMs in the public realm. These QMs are used to provide the public and others with indicators of quality of care. Thirteen MDS 3.0 based QMs are reported in the QM domain of the Five-Star Rating System reported on Nursing Home Compare. Examples of QMs that can be negatively affected by inaccurate MDS assessments are prevalence of residents with pressure ulcers, residents who report moderate to severe pain, and residents experiencing one or more falls with major injury. An inaccurate MDS can also negatively affect the care plan developed for the resident and, as a consequence, the actual care the resident receives.
CMS’s Five-Star Quality Rating System has grown in importance since its inception. It is used by consumers, referral sources, regulators, lenders and investors to gauge nursing home quality. Nursing homes will be increasingly foreclosed from participating in Medicare, provider referral networks, various innovative Medicare payment arrangements (e.g., episodic care, etc.) and opportunities for waiver of the 3-day prior hospital stay requirement in Medicare bundled payment and accountable care arrangements unless they have at least a 3-Star overall rating. Essentially, such a facility may be unable to receive sufficient numbers of admission referrals and Medicare payments in the future.
In summary, inaccurate MDS assessments can lead to inaccurate billing, poor outcomes, declining referrals, and ultimately threaten business sustainability. LeadingAge NY Technology Solutions provides a suite of tools that help members enhance quality, MDS accuracy and ultimately reimbursement. The newest tool, Quality Apex, has an MDS 3.0 “Scrubber” with over 275 audits providing an opportunity to enhance each MDS’s accuracy prior to care planning, billing or establishing QM rates.
Susan Chenail RN, CCM, RAC-CT, Senior Quality Improvement Analyst, LeadingAge New York
