Depression Diagnosis Can Raise Nursing Home Rates

By
Original story posted on: October 16, 2019

Therapy hours could go down and depression to go up at SNFs.

A depression diagnosis is often hard to make. Clinical depression can be demonstrated in many ways and requires the subjective findings of a clinician. Some clinically depressed individuals seem to withdraw, while others can become irritable or even agitated. Eating and sleeping patterns can be affected. Clinical depression may cause a person either to sleep or eat to excess or almost refuse to eat or not be able to sleep. In skilled nursing homes, patients may have symptoms of depression that are situational or impacted by medications. 

Under the old Resource Utilization Group (RUG) system, skilled nursing facilities (SNFs) had reimbursement driven mainly by the number of minutes of physical, occupational, and speech therapy services provided. 

Now, SNFs can increase their Medicare payments dramatically just by claiming that all their patients are depressed. 

Let’s look at an example of how this works. We took a sample claim for a nursing home we know well and assumed a 31-day stay. We assumed a patient had a hip replacement. We also assumed that they were cancer-free.

The patient is morbidly obese, so they have an NTA of 1 to 2. We also assume their function score is 6 to 14. (If you need some of these terms explained, contact me).

If this patient is not depressed, the Medicare per diem is $599.59. With the same patient, if depression is present, the per diem payment is $647.41. This is a whopping 7.98 percent increase in payment. 

In addition to the potential for abuse of the depression diagnosis, there’s the fact that the diagnosis is subjective, and based on the opinion of the clinician. What if SNFs hire clinicians to diagnose all their patients as depressed? The appeals are much harder for Medicare to fight since they are based not on hours of therapy, but a clinical finding. 

Will the Zone Program Integrity Contractors (ZPICs) and Recovery Audit Contractors (RACs) hire their own psychiatrists to dispute a diagnosis of depression? Will SNFs be under-reimbursed because they fail to make a proper diagnosis? Will some nurses and Minimum Data Set (MDS) coordinators simply click the boxes on their electronic medical record (EMR) forms to denote depression?

We are left with many more questions than answers, and here in South Florida, I expect therapy hours to go down and depression to go up at SNFs.

Timothy Powell, CPA CHCP

Timothy Powell is a nationally recognized expert on regulatory matters, including the False Claims Act, Zone Program Integrity Contractor (ZPIC) audits, and U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) compliance. He is a member of the RACmonitor editorial board and a national correspondent for Monitor Mondays.

This email address is being protected from spambots. You need JavaScript enabled to view it.

Related Articles

  • CMS Finalizes Payment Rules for IPFs, SNFs, Hospices 
     Federal officials seek enhancements to the Medicare program through payment realignment. The Centers for Medicare & Medicaid Services (CMS) has finalized Medicare rules adjusting payments for three types of providers: inpatient psychiatric facilities (IPFs), skilled nursing facilities (SNFs), and hospices.…
  • Nursing Homes – It Is All About Case Mix
    Based on latest filed Medicare cost reports, a little over 12 percent of all skilled nursing facility or “SNF” patients are Medicare recipients. This is excluding Medicare Advantage patients.  By comparison, over 57 percent of patient days were for Medicaid…
  • One Third of All Florida COVID-19 Deaths Are In Nursing Homes
    The new coronavirus is linked to 1,502 deaths among residents of nursing homes and assisted-living facilities in Florida, a new state report shows. It’s an increase of 145 deaths in one week. This is particularly sad when we remember the patients…