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Your skilled nursing home facility and new Rug IV refinements PART 1

Important Acronyms:

Skilled Nursing Facility (SNF)

Minimum Data Set (MDS)

Resource Utilization Group (RUG)

With new RUG IV refinements stemming from the SNF PPS FY2012 Final Rule, you might find yourself feeling a bit overwhelmed and wondering how you will transition your facility. Here is a simple guide that discusses the basics refinements of new RUG IV changes and how they could affect your skilled nursing home facility.

What is RUG?

RUG (Resource Utilization Groups) is a patient classification system for nursing home patients used by the Federal government to determine reimbursement levels for skilled nursing home facilities. This system categorizes residents into a payment group based upon their care and resource needs. Skilled nursing home facilities determine a RUG based on a resident’s classification items that are documented during the Minimum Data Set (MDS) assessment.

Why the changes?

RUG IV essentially recalibrates the RUG III in order to put more money into complex patient cases that require intensive nursing services. This monetary shift is accomplished by adjusting therapy group payments. In other words, payments for intensive nursing care will rise while total payment for therapy groups will remain fairly constant. This redistribution of money addresses an ongoing problem of over-reimbursing therapy services and under-reimbursing medically complex residents.

What are the new resident classifications?

The improved MDS 3.0 affects how some RUG groups are organized.

  • IV-meds/feeding is moved from Extensive Services to Clinically Complex
  • Parental/IV feeding is moved from Extensive Services to the Special Care High category
  • The Special Care category is now split into “high” and “low” for more accurate case-mix indexes (CMIs)
  • The Impaired Cognition and Behavior categories are combined into one category

Differences between RUG III and RUG IV

  • The Extensive Services category shows substantial increases in payment from RUG III to RUG IV
  • Payments for the Clinically Complex category will also increase substantially
  • Improved MDS 3.0 affects how RUG groups are organized

How RUG IV might affect your skilled nursing home facility…

IV medication and IV feeding are no longer qualifiers for Extensive Service: Most residents who were once classified under the Extensive Service category under RUG III will be re-classified under the Special Care and Clinically Complex. Only 1.04% of the residents can classify under Extensive Services.

Allocating minutes for concurrent therapy: Under RUG IV, therapists receive one hour’s salary for the hour of therapy provided, regardless of whether the therapist treated one patient individually or two patients concurrently for that hour.

No more “look back” period for payment purposes: In RUG III, SNF are able to “look back” a certain number of days into the hospital stay of a patient to determine whether a resident needs a high level of staff time. SNFs are now required to code for only those services provided at the SNF. Providers are still able to code for those services received in the hospital on MDS 3.0 for care planning purposes.

No more estimated therapy: Currently, a patient can be categorized into a high, medium, or low rehabilitation group using an estimate of the amount of therapy that will be provided, rather than the actual amount provided. Now that Section T is eliminated, only actual minutes delivered can be reported.


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Tags: RUG IV, skilled nursing facility