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PDPM case-mix per diem

Use PDPM case-mix per diem when reimbursement is based on PDPM component amounts for covered skilled nursing facility days. This model is typically used for Medicare Part A and Managed Care Part A payors.

This guide explains how to configure PDPM case-mix per diem arrangements in RehabAlpha. For Medicare's calculation methodology, including case-mix rates, variable per diem factors, wage adjustment, interrupted stays, and detailed formulas, see How Medicare Part A calculates SNF payments.

Before you start​

For a payor arrangement, create the payor with PDPM case-mix per diem selected as its payment model. A payor's payment model cannot be changed after the payor is created.

For a facility contract, the PDPM case-mix per diem contract payment model can apply only to payors that also use PDPM case-mix per diem. Use this direct contract model when the facility pays your therapy organization according to component-specific percentages and day rules. If the facility instead pays one percentage of the total resolved payor reimbursement, use Share of resolved payor reimbursement.

Set up a payor arrangement​

  1. Open the payor.
  2. Click Arrangements.
  3. Click New payor arrangement.
  4. Choose whether the arrangement applies to all billing providers or specific billing providers.
  5. Enter the arrangement's start and end dates.
  6. Under Payment details, choose whether to include the wage index adjustment and variable per diem adjustment.
  7. Click Save.

The two adjustment settings determine the daily amounts RehabAlpha uses to estimate what the payor reimburses the billing provider:

  • Include wage index adjustment? uses wage-adjusted component amounts. Turn it off to use unadjusted component amounts.
  • Include variable per diem adjustment? applies the stay-day factors to PT, OT, and NTA. Turn it off to use a factor of 1.0 for those components. This setting does not change SLP, Nursing, or non-case-mix amounts.

Both settings are on by default.

Set up a facility contract payment term​

  1. Open the facility.
  2. Click Contracts.
  3. Click New contract.
  4. Enter the contract dates and add a contract payment term.
  5. In Step 1: Choose how the facility pays [your organization name], select Contract payment model, and then select PDPM case-mix per diem.
  6. In Step 2: Choose payors, choose all eligible payors or filter them by payor type or specific payors.
  7. In Step 3: Configure the contract payment model, configure the rate adjustments and PDPM component rules.
  8. Click Save.

Choose the rate adjustments​

Under PDPM rate adjustments, choose which Medicare adjustments are included in the revenue-share basis. The settings work the same way as they do for a payor reimbursement arrangement:

  • Include wage index adjustment? selects wage-adjusted or unadjusted component amounts.
  • Include variable per diem adjustment? determines whether the PT, OT, and NTA amounts include their stay-day factors.

Both settings are on by default. The contract settings are independent of the payor reimbursement arrangement settings.

Configure the component rules​

Under PDPM component rules, configure each component the contract shares with your therapy organization:

ComponentWhat to configure
OTRevenue-share percentage, applicable days, and discharge-day rule
PTRevenue-share percentage, applicable days, and discharge-day rule
SLPRevenue-share percentage, applicable days, and discharge-day rule
NRevenue-share percentage, applicable days, and discharge-day rule
NTARevenue-share percentage, applicable days, and discharge-day rule
Non CMGRevenue-share percentage, applicable days, and discharge-day rule

Leave Rev share blank to exclude a component. At least one component must be included.

The Applies on rule determines which dates normally include a component:

RuleWhen the component is included
Covered daysThe date is a covered PDPM day.
Caseload daysThe patient has an active case for at least one of the selected caseload disciplines.
Service daysA clinical document for any discipline has a logged CPT code with more than 0 minutes on the date.
OT service days, PT service days, or SLP service daysA clinical document for that component's discipline has a logged CPT code with more than 0 minutes on the date.

The discipline-specific service-day rules are available only for the OT, PT, and SLP components. When any component uses Caseload days, select one or more Disciplines that constitute a 'caseload day'. A case is active from its start date through its end date.

Configure the discharge-day rules​

The Include discharge day? rule is separate from Applies on. On the facility discharge date, it replaces the component's normal day rule:

RuleWhen the component is included on the discharge date
AlwaysThe component is included even when the date is not covered and no selected caseload or qualifying service applies.
If covered dayThe discharge date is a covered PDPM day.
If caseload dayThe patient has an active case for a selected caseload discipline on the discharge date.
If service dayAny discipline has a logged CPT code with more than 0 minutes on the discharge date.
If OT service day, If PT service day, or If SLP service dayThe matching discipline has a logged CPT code with more than 0 minutes on the discharge date.

The discipline-specific discharge rules are available only for the matching OT, PT, and SLP components. The facility discharge date comes from the admission end date in the facility's time zone. It is not determined by a discipline's discharge note.

For an included discharge date that is not covered, RehabAlpha calculates the hypothetical PDPM component amounts for that date using the contract's two adjustment settings. It uses the active assessment and the stay-day sequence the date would have had if covered, without consuming a Medicare benefit day.

How the contract amount is calculated​

For each included component and date, RehabAlpha calculates:

selected daily component amount x component revenue-share percentage

The contract amount is the sum of those results for every component whose applicable day or discharge-day rule is satisfied.

For example, a contract can specify:

  • 25% of every PDPM component on every covered day.
  • 20% of OT, 22% of PT, and 18% of SLP on their respective discipline service days, with Nursing, NTA, and non-case-mix excluded.
  • Nursing, NTA, and non-case-mix revenue on days when the patient is on the selected disciplines' caseloads.
  • OT on every facility discharge day, PT only when the discharge date is a PT service day, and SLP only when the discharge date is covered.