Change in Medicare Reimbursement

Medicare implemented a Case Mix Reimbursement in response to the Nursing Home Reform Act. For many years, the Resources Utilization Groups (RUGs) was the system used. CMS dramatically revised RUGs in 2019. They created a new system: Patient Driven Payment Model (PDPM). These changes have a significant impact on nursing homes.

As you learned with Chapter Six (Financing and Reimbursement), Medicare plays a significant role in nursing home fiscal viability. Most nursing homes lose money from Medicaid reimbursement. Medicare is profitable but limited given Medicare coverage rules. Nonetheless, changes in Medicare reimbursement are very important to nursing homes.

The material that describes PDPM and the changes to Medicare Reimbursement can be found in the Week Three and Four subfolder (Finance and Reimbursement), located in the Week-by-Week Folder.

• Define, describe, explain the PDPM reimbursement system
• Identify important differences between PDPM and RUGs 4
• Define and describe how PDPM impact nursing homes. Consider
  • Who is admitted?
  • How does this create and opportunity or threat to a facility?
  • How does this impact operations?

Students may use outside sources. Proper sourcing and referencing is required for all material that are used.