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It’s P.E.P.P.E.R Time Again!

by | Tuesday, August 11, 2020 | Compliance, Featured, Regulatory, Risk Management | 0 comments

The fourth quarter of FY2019 Program for Evaluating Payment Patterns Electronic Reports (PEPPERs) are now available as of July 29, 2020 for Skilled Nursing Facilities (SNFs). The original scheduled release date was April 6, 2020.

What is a P.E.P.P.E.R (PEPPER)? PEPPER is a data report that identifies a single SNF’s Medicare claims statistics for certain target areas. The statistics are obtained from the UB-04 claims submitted to the Medicare Administrative Contractors (MACs). The PEPPER will show a particular SNFs data compared to the MAC aggregate jurisdiction, state, and national statistics. The intent of the PEPPER is to assist SNFs in identification of potential improper payments and compare their data to national, MAC jurisdiction, and state statistics. Please know that the PEPPER is not identifying that improper payments took place but rather, identifying potential risk for improper payments and should be used as a guide for auditing and monitoring practices. The target areas were identified by The Centers for Medicare and Medicaid Services (CMS) as being potentially high risk for improper Medicare payments. The PEPPER includes reporting of reportable data for the most recent three fiscal years, October 1 through September 30. Reportable data is numerator count of eleven or more for any particular target in the time period reviewed. If the numerator count is less than eleven for any particular target area in the time period reviewed, no data will be displayed. 

 

How to interpret the P.E.P.P.E.R Report

PEPPER determines whether the SNF is an outlier by preset control limits. The upper control limit is the national 80th percentile (not percentage). The lower control limit is the national 20th percentile (not percentage). If you fall into the national 80th percentile, indicated in red on your PEPPER, this could mean you may be at risk improper payments. Conversely, if you fall into the national 20th percentile, indicated in green on your PEPPER, you may at risk for under coding.

 
Percentiles are derived by taking the target area percents of all SNFs with reportable data, in the time period reviewed, and organize those percents from highest to lowest order. I really like this illustration from PEPPER to explain how the percentile concept works.
 
Let us look at the last three target areas on the list above in bold because the 20-Day Episodes of Care, 90+ Day Episodes of Care will most likely stick around, and the 3-5-Day Readmission was just added.

How to interpret the P.E.P.P.E.R Report

PEPPER determines whether the SNF is an outlier by preset control limits. The upper control limit is the national 80th percentile (not percentage). The lower control limit is the national 20th percentile (not percentage). If you fall into the national 80th percentile, indicated in red on your PEPPER, this could mean you may be at risk improper payments. Conversely, if you fall into the national 20th percentile, indicated in green on your PEPPER, you may at risk for under coding.

 
Percentiles are derived by taking the target area percents of all SNFs with reportable data, in the time period reviewed, and organize those percents from highest to lowest order. I really like this illustration from PEPPER to explain how the percentile concept works.
 
Let us look at the last three target areas on the list above in bold because the 20-Day Episodes of Care, 90+ Day Episodes of Care will most likely stick around, and the 3-5-Day Readmission was just added.

Current P.E.P.P.E.R Target Areas

  1.  Therapy RUGs with High ADL (Therapy Hi ADL)
  2.  Nontherapy RUGs with High ADL (Nontherapy Hi ADL)
  3.  Change of Therapy Assessment (COT Assmnt)
  4.  Ultrahigh Therapy RUGs (Ultrahigh)
  5.  20-Day Episodes of Care (20 Days)
  6.  90+ Day Episodes of Care (90+ Days)
  7.  3 to 5 Day Readmissions (3-5 Day Readm) *new as of the Q4FY19 release.

Target 5

20 Day Episodes of Care

Reason for Target: SNFs have a financial incentive to keep residents for 20 days, even through the resident may no longer require the skilled care.
 
Focus: If you fall into the 80th percentile in this target area, you will want your focus to ensure that residents with 20 day episodes of care required a continued skilled level of care.

Target 6

90+ Day Episodes of Care

Reason for Target: SNFs may keep residents on skilled services, regardless if the meet the skilled level of care, just because the resident has 100 available days.
 
Focus: If you fall into the 80th percentile in this target area, you will want your focus to ensure that residents are receiving medically necessary services. Focus should also ensure residents received skilled care the entire duration of their SNF stay (evidenced in the clinical documentation).

Target 7

3 to 5 Day Readmissions

Reason for Target: PDPM provides an incentive for SNFs to discharge residents from a covered Part A stay and then readmit the resident in order to reset the variable per diem schedule. To avoid this incentive, CMS included an interrupted stay policy. The interrupted stay will continue the Part A stay when the resident discharges and readmits fall within three consecutive non-covered calendar days (by 11:59 pm on the third consecutive non-covered calendar day.
 
Focus: If you fall into the 80th percentile in this target area, you will want your focus to ensure that if the resident does qualify for an interrupted stay, you code the interrupted stay (not a new Part A stay) appropriately on the MDS and SNF claim.

Schedule Your Complimentary Analysis

We are here to help you with your P.E.P.P.E.R. Both current and potential
FP client partners can submit their P.E.P.P.E.R to pdpm@fprehab.com.
Once received, someone from our Compliance Team will analyze
and provide you with a summary and recommendations.