Part I: “Copious” Therapy in Nursing Homes – Financial Gain or Good Therapy? (or both?)

Disclaimer before I go further – I work at a wonderful place that listens to its therapists’ recommendations regarding level of minutes. They respect our professional recommendations and we work together to deliver what is appropriate, adjusting levels as needed. I am very thankful to be working there; this blog especially this post and the next one are my thoughts and do not reflect the thoughts, positions, or practice of the staff or management.


On Monday August 17th, The Wall Street Journal had a page 1 article entitled “Nursing-Home Rehab Raises Medicare’s Tab” with the subtitle online of “Medicare pays top dollar for patients in heavy rehab; the pivotal 720-minute mark” and in the paper “Federal rules can give homes financial incentive to provide ‘ultra high’ therapy.” For those who don’t have access, I will give you an overview in this post [along with a few comments], then provide a few thoughts on the article.

The article leads with a story of a 96-year-old gentleman in California who had fallen and broken his hip, had it surgically repaired, and then went to a SNF/TCU for rehabilitation. He “became severely dehydrated… in part because staff did not follow written plans for his nutrition or facility policies… still, during many of his 21 days there, the 96 year old man suffering from dementia received 2 hours or more of [PT and OT] combined.” This gave the nursing home an “ultra-High” level for rehab, billing Medicare “top dollar for his entire stay.”

Medicare use to pay based on costs, but in 1998 it adopted a new payment system based on categories, which the article points out has been billed at higher levels with increasing frequency. In 2002 the average use of RU for billing was 7% nationwide, and in 2013 it was up to 54%. The categories with corresponding minutes/week and 2013 reimbursement rates are below (I added the minutes per day per discipline).

Category Number of minutes/wk Reimbursement in 2013 (WSJ) Minimum minutes/day with 2 therapies (5 days a week) Minimum minutes/day with 3 therapies (5 days a week)
RL 45-149 $325/day
RM 150-324 $341/day
RH 325-499 $383/day 33 each
RV 500-719 $445/day 50 each 33 each
RU 720 $560/day 72 each 48 each

According to Vincent More (Brown University health services professor, and chairman of the independent quality committee at HCR ManorCare Inc), the new system “‘changed the incentives which changed the culture… playing to the max has a long tradition in health care – that tradition is based on the number of minutes of therapy given, so people give therapy up to the max.’ He says factors such as a trend of sicker patients getting admitted to nursing homes may also contribute to rising therapy.” While he acknowledges the benefits of therapy he admits that we don’t know if outcomes are better with higher minutes. The article notes that this payment system causes problems, with dozens of interviews (former and current therapists, rehab directors and others who provide care in 17 states) revealing pressure to reach the 720 minute mark. This delivery of therapy even occurs “when patients are unresponsive, aren’t likely to benefit or have declined such services” [some therapists talk about this pressure; more about this in my next post].

This high level of billing occurs across the country, in small sites and large chains, with several chains mentioned (Genesis, Kindred, HCR, and Five Star Quality Care); HCR is being sued by the DOJ for allegedly pressuring employees to provide unnecessary therapy and overbill Medicare (HRC “refutes the basic claims” and states that they provide care “based on [patients’] individual clinical needs.”).

Industry defenders such as David Gifford (senior VP at the American Health Care Association) believe the WSJ analysis “is incomplete because it doesn’t examine patient outcomes but ‘shows we are trying to provide as much therapy as possible to get people better.’ Patients generally want as much therapy as possible [in my experience this is not common] and Medicare doesn’t set quantity guidelines he says…. Factors beyond money drive increased therapy, says Kim Blunt, an nursing home consultant and former nursing-home administrator at HCR and other organizations. Patients are more educated about health care than a generation ago, she says, and demand more therapy [again, in my experience this is not common]. Providers more thoroughly document treatment she says [point of service documentation is feasible, but would not justify the increase in RU, and can be an ethical issue depending on how it is done in my opinion], and hospitals send patients to nursing homes sooner after surgeries” [true, but often they can’t tolerate an RU when they are more sick].

Critics of the high billing practices report pressure to get as many patients as possible to the 720 minute mark, but not to go over it. Therapists are asked to provide therapy to those who refuse it, don’t need it, or are in “advanced stages of illness.” WSJ analysis of data showed that from 2010 to 2013, nursing homes billed Medicare at the RU level for at least 51,000 patients “until they went on hospice… and about 110,000 patients died within five days” of RU billing. Mr. Gilford “says many patients may need lots of therapy to prepare for home-based hospice care” [they may need therapy to be able to get up stairs or improve strength to make it home, but I haven’t seen it take an RU to do it].

The billing system was developed by Dr. Brant Fries at the University of Michigan, “using statistical methods to determine categories based on examining patients at the time because there wasn’t good science predicting how much therapy was needed. There still isn’t good science, he says, adding that he named the ultrahigh category after determining patients getting 720 minutes were “a very rare group.” Responding to the Journal’s findings, he says there may be “excesses of people getting rehabilitation””. In January the Medicare Payment Advisory Commission (independent congressional agency) and the Urban Institute released a report, stating that “the present payment system continues to encourage providers to furnish clinically-unnecessary services for financial gain.” [emphasis mine]

The article closes with more to the story of the 96 year old gentleman, with snippets of information from the OT and SLP notes over the last week of his stay there, including “no understanding or recall” of OT’s fall prevention instruction and the SLP’s report that he “is unable to hold his head up for longer than several seconds.” The day before he was sent to the hospital he became agitated and tried to hit a therapist, and received 61 minutes of PT, 50 of OT, and 60 of SLP.


I’d love to say that numbers don’t matter in healthcare rehabilitation, but this is a business and if you run your business without thinking of the numbers to some extent you won’t be around long. But has evidence for more rehab supported this dramatic increase? That is a tough question; I haven’t seen any study looking at discharge location, re-admittance rates, falls, or anything like that relating to RUG levels. But it is questionable to me with the financial incentives to provide more, and the pressures put on therapists at times to get minutes/ levels, and I don’t know that research would support the extent that RU is billed (if anyone has data, please share and enlighten me!).

So where might we go from here? This article may spur quicker changes at CMS; paying by minutes doesn’t seem to work, and MPAC/ UI’s report acknowledges the financial conflict of interest. Paying strictly by outcomes won’t work (sicker patients take longer and won’t recover as much), though G-codes make me think they are heading that way. I like the idea of FOTO, which allows comparison of patients to others with similar conditions (it is mostly an OP tool, but apparently has a SNF version). Let’s hope whatever CMS adopts is something that all parties can get behind. According to an article in the new GeriNotes, the IMPACT Act of 2014 (Improving Medicare Post-Acute Care Transformation) requires the implementation of standardized assessment data by October 1, 2018 (Home Health is extended until January 1, 2019). These data are functional status, cognitive function/ mental status, special treatments, interventions, and services, medical conditions/ comorbidities, impairments, and an “other” (any category required by the Secretary of HHS). It will be interesting to see what they will do with the data and how they will tie it into payment.

You can read the APTA’s response in this PT in Motion article.


4 responses to “Part I: “Copious” Therapy in Nursing Homes – Financial Gain or Good Therapy? (or both?)

  1. Pingback: Part II: “Copious Therapy”: Ethical Considerations | PT for Boomers - and beyond

  2. David, great blog with detailed information! I will revisit this often in the weeks and months ahead!

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