Long-Term Care

What does RUG-IV mean for your facility?

Billing Alert for Long-Term Care, July 1, 2009

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CMS released its proposed rule for fiscal year (FY) 2010 payment updates for SNFs May 1. Included in the rule is a proposal to implement a new case-mix classification model, known as Resource Utilization Group, Version Four (RUG-IV), in tandem with the MDS 3.0 October 1, 2010, which marks the beginning of FY 2011. Many of the changes incorporated into RUG-IV are evident in the updated MDS 3.0 Draft Item Set, which CMS released May 7.

Medicare uses a case-mix classification system to assign a nursing home resident to a RUG category based on his or her medical conditions and the resources needed to provide care. Each RUG category is tied to a Medicare payment rate.

Based on results from the Staff Time and Resource Intensity Verification project, CMS believes that the currently used model, RUG-III, is no longer an effective way to determine the resource time required to care for certain conditions.

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