Unlocking Reimbursement Potential: Avoiding Common MDS Pitfalls Under PDPM
Insights from Scott Heichel RN, RAC-MT, RAC-CTA, DNS-CT, IPCO, QCP, ICC, Director of Reimbursement and Education, Pathway Health
Since its implementation in 2019, the Patient-Driven Payment Model (PDPM) has transformed how skilled nursing facilities (SNFs) are reimbursed under Medicare Part A. By shifting the focus from therapy minutes to resident characteristics and clinical complexity, PDPM aims to better align payment with patient needs. However, this model also places a premium on accurate and comprehensive MDS documentation, and that’s where many facilities leave money on the table.
Understanding PDPM: A Quick Refresher
PDPM classifies residents into five case-mix adjusted components:
- Physical Therapy (PT)
- Occupational Therapy (OT)
- Speech-Language Pathology (SLP)
- Nursing
- Non-Therapy Ancillary (NTA)
Each component is scored independently based on MDS data, and the total reimbursement is a composite of these scores. This makes MDS accuracy critical to financial performance.
Commonly Missed MDS Areas That Impact Reimbursement
Recent data and expert insights reveal several high-impact areas where SNFs frequently under-document or miscode, leading to lost reimbursement opportunities [1].
1. Speech-Language Pathology (SLP) – 38% Error Rate
- Missed swallowing disorders and nutritional issues are common.
- Section K (Swallowing/Nutritional Status) is often incomplete or lacks supporting documentation.
- Tip: Observe residents during meals and medication passes. Interview staff and review dietary notes to identify swallowing issues early.
2. Non-Therapy Ancillary (NTA) – 31% Error Rate
- NTAs include conditions like diabetes, COPD, and infections that require extensive services.
- Common issue: Diagnoses are present in physician notes but not coded in the MDS.
- Tip: Use NTA “cheat sheets” and ensure diagnosis codes are supported by physician documentation.
3. Nursing – 27% Error Rate
- Errors often stem from missing symptoms like shortness of breath while lying flat or oxygen therapy not being transferred from nursing notes to the MDS.
- Tip: Train staff to flag and document these symptoms clearly and consistently.
4. Interim Payment Assessments (IPAs) – Underutilized
- Though optional, IPAs can capture changes in condition that warrant higher reimbursement.
- Tip: Monitor for clinical changes that could trigger an IPA, such as new diagnoses or functional decline.
Best Practices to Maximize PDPM Reimbursement
- Interdisciplinary Collaboration: Ensure nursing, therapy, dietary, and MDS coordinators communicate regularly.
- Ongoing Training: Keep staff updated on PDPM coding rules and MDS changes.
- Audit and Review: Conduct regular internal audits of MDS assessments to catch and correct errors.
- Leverage Technology: Use software tools that flag inconsistencies and suggest potential missed opportunities.
Final Thoughts
PDPM offers a more nuanced and equitable reimbursement model, but only if SNFs are diligent in their documentation. By focusing on the most error-prone areas—SLP, NTA, and nursing—and fostering a culture of accuracy and collaboration, facilities can ensure they’re not leaving money on the table.
Pathway Health Resources
Access helpful tools and resources to help you and your team navigate any reimbursement questions you may have.
- Reimbursement Resources: From training modules to complimentary checklists and tools, we have numerous resources to help your facility succeed. Learn more.
- MDS Baseline Assessment: Receive the support of one of our MDS expert consultants to obtain support with identifying training needs, standardizing documentation practices, strengthening IDT communication and more. For more information, connect with our team here.
Register for a Complimentary Webinar on R.O.I.
Register for an upcoming complimentary CE session on 7/8/2025, “What Every Leader Needs to Know About R.O.I. (Reimbursement Optimization Improvement)”.
This session will provide leaders with keen insight into missed reimbursement opportunities, what leaders need to know, and resources leaders can use to stay on top of all of the changes impacting their financial outcomes.
References
[1] Money on the Table: Common Mistakes Cost Nursing Homes PDPM Reimbursement