In this episode, we are joined by BESLER’s Mary Devine to discuss changes to how hospice reimbursement is treated under the Medicare Post-Acute Transfer Policy
Is your hospital recovering all Transfer DRG overpayments and underpayments? For additional validation, contact BESLER about our Transfer DRG Recovery Service.
Highlights of this episode include:
- Background on the Medicare Post-Acute Transfer policy
- What discharge status codes will be impacted by the post-acute transfer policy
- Estimated impact of hospice updates to healthcare providers
- And more…
How the Medicare Post-Acute Transfer Policy works
Prior to the enactment of the Bipartisan Budget Act of 2018, a hospital discharge was impacted by the Post-Acute Transfer Policy if the individual was discharged to one of the following post-acute care settings:
- A hospital or hospital unit that is not a subsection (d) hospital.
- A skilled nursing facility.
- Related home health services provided by a home health agency provided within a timeframe established by the Secretary (beginning within 3 days after the date of discharge).
When a patient is transferred to another hospital and the length of stay is less than the geometric mean length of stay (GMLOS) for a DRG, the transferring hospital would be paid based on a graduated per diem rate for each day of stay, up to the full MS–DRG payment. This is true for all DRGs.
For discharges to the specific post-acute care settings listed above, this per diem payment adjustment is only for certain DRGs.
Changes to hospice reimbursement under the Medicare Post-Acute Transfer Policy
The discharge status codes that will be impacted by the post-acute transfer policy under the 2019 IPPS Final Rule are:
- 50 (hospice home)
- 51 (hospice inpatient)
In 2018 and part of 2019, providers are entitled to the full MS-DRG when 50 or 51 is used. Beginning with discharges on October 1, 2019, post-acute transfers to hospice care will receive a per diem payment rather than the full DRG payment.
The inclusion of hospice in the post-acute transfer rule was the subject of debate.
Because payment would be decreased, it was thought that this might influence physicians to delay discharging patients to hospice care. This could negatively impact patient choice and quality at the end of life.
Additionally, it was argued the original intent of the post-acute care transfer policy was to discourage hospitals from admitting and discharging patients below the GMLOS to a post-acute care setting for therapeutic care. Hospice providers do not provide treatment, only comfort care. Thus, there could never be a duplication of services or duplicate payment for the same care.
Despite these concerns, hospice is now included in the Medicare Post-Acute Transfer Policy.
Expected impact of the hospice updates
CMS has estimated the inclusion of hospice transfers to the transfer policy will result in a savings to the Medicare program in the amount of $540 million. This translates to a direct reduction in reimbursement to healthcare providers.
Further, it is estimated that this change will impact 30% of discharges to hospice care. On average, this will reduce provider reimbursement by $200,000 annually.
It is important for Medicare providers to review discharges to hospice care.
- It should be confirmed that hospice election is on the day of discharge or the patient is returning to their existing hospice span.
- If the hospice election is not on the day of discharge or in an existing span, coding the discharge as a 50 or a 51 will result in underpayment.
CMS is clear underpayment reviews are the responsibility of providers.
One final note to remember, if the length of stay is at or above the GMLOS, the discharge will not be impacted by the post-acute transfer policy and the full DRG amount will be received.