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October 1 brought Medicare’s new Patient-Driven Payment Model (PDPM) for beneficiaries accessing their skilled nursing facility (SNF) Part A benefit. PDPM payments are based on patient characteristics, not service delivery. So how will you pay your therapy contractor under PDPM, and is there a way to match up incentives between the two entities?

Let’s review a few of the payment models being discussed in the industry:

Payment model #1: Time on-site—The provider pays the contractor X dollars per hour for every hour the contractor’s staff are on-site.
Payment model #2: Flat rate per patient day—The provider pays the contractor a flat rate for each Part A patient day.
Payment model #3: Percentage of PDPM therapy components—The provider pays the contractor a percentage of the physical, occupational, and speech-language pathology therapy components that the facility receives as reimbursement under PDPM.
Payment model #4: Percentage of the entire PDPM payment—The provider pays the contractor a percentage of the entire PDPM payment for that patient’s stay.
Payment model #5: Don’t pay the contractor—This model could be very attractive for larger SNFs or SNFs with multiple therapy lines of business on campus.

To learn more about PDPM and to finish reading this article, click here.

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