Inpatient Facility Coding & Compliance Alert

Capture dollars with new quality measures that IMPACT Act brings in 2016.

The Improving Medicare Post-Acute Care Transformation Act (IMPACT Act), enacted and signed by President Obama on Oct 6, 2014, will standardize assessments across all post-acute care (PAC) settings and lead to payment reform. “At this point, hospitals and the other affected providers should be very watchful and prepared to comment on the plans and processes that CMS develops to implement IMPACT,” explains Duane C. Abbey, PhD, president of Abbey and Abbey Consultants Inc., in Ames, IA. Read on for what the change could mean for your facility, and how you can prepare. 

Background: The IMPACT Act directs the U.S. Department of Health and Human Services (HHS) to standardize patient assessment data, quality, and resource use measures for PAC providers including long-term care hospitals (LTCHs), inpatient rehabilitation facilities (IRFs), skilled nursing facilities (SNFs), and home health agencies (HHAs). HHS felt the need for this standardization as all of the above facilities have their own sets of rules, procedures and costs, and a patient visiting one or more of these places for treatment would face disparities in terms of costs and protocols amongst others.

How the Standardized Tool Will Work

The new law involves creating a new standardized assessment tool to provide common data reporting across PACs for patient assessment, quality comparisons, resource use measurement, and payment reforms. 

The IMPACT Act will incorporate standardized assessment into existing assessment tools across PAC providers, according to a recent analysis by the American Health Care Association (AHCA) and National Center for Assisted Living (NCAL). 

The tool will measure quality based on a variety of metrics, including:

• Pressure ulcers 
• Functional status
• Cognitive status 
• Special services.

The providers will collect this data at least twice as the minimum requirement (such as at admission and discharge). The Act also requires the existing patient assessment data elements that are duplicative or overlapping to be revised or replaced.

Get Ready for New Quality Measures

The Act also calls for the development and public reporting of following quality measures, as per AHCA/NCAL reports:

• Discharge to community
• Pressure ulcers 
• Medication reconciliation 
• Incidence of major falls 
• Patient preferences
• Rehospitalizations 
• Average total Medicare cost per beneficiary.

The law requires PAC providers and hospitals to provide quality measures to patients when transitioning to a PAC setting. It also modifies conditions of participation to incorporate QMs (Quality Measures) into the discharge planning process. 

Timelines: The new quality measures requirement begins on Oct. 1, 2016, and will continue through Jan. 1, 2019. Use of quality data to inform discharge planning should begin in FY 2016, and PAC providers will need to begin using the standardized quality and resource use measure in FY 2017.

There will also be confidential feedback reports to PAC providers in 2017, followed by public reporting of PAC provider performance by 2018. The law requires that LTCHs and other PAC providers begin using standardized assessment data in fiscal year (FY) 2019 (Oct. 1, 2018).

Prepare for Payment Reforms Ahead

What’s next: HHS and the Medicare Payment Advisory Commission (MedPAC) will submit a report to Congress that evaluates and recommends features of a unified post-acute care payment system and establishes payment rates according to characteristics of individuals (such as cognitive ability, functional status, and impairments) rather than according to the post-acute care setting where the Medicare beneficiary involved is treated. To the extent feasible, such report shall consider the impacts of moving from current PAC payment systems.

The Secretary of Health and Human Services shall also submit his analysis, recommendations and a technical prototype, on a post-acute care prospective payment system based on two years of data on quality measures. 

Heads up: “Hospitals and the other healthcare providers find themselves in a reactive mode more than anything else”, says Abbey. He further adds that “All of the providers probably agree that the payment systems developed by CMS in these areas should have been coordinated.” 

The Act indicates there will be payment consequences for PAC providers that fail to report the standardized assessment data, quality resource and other measures. In fact, your facility could suffer a 2-percent market basket penalty if you fail to effectively collect and report data.

To read the legislation, go to https://www.congress.gov/bill/113th-congress/house-bill/4994/text.