Patient-Driven Groupings Model (PDGM) in Home Health Care

The Patient-Driven Groupings Model (PDGM) is a reimbursement payment model used by the Centers for Medicare & Medicaid Services (CMS) for home health services in the United States. It was implemented on January 1, 2020, and it replaced the previous payment model known as the Prospective Payment System (PPS).

PDGM is designed to more accurately reimburse home health agencies for the services they provide to Medicare beneficiaries. The payment under the Patient-Driven Groupings Model (PDGM) for home health services is designed to be more patient-centered and based on a variety of factors, including the patient’s clinical characteristics and needs.

Key features of PDGM include:

  1. Patient-Centered Care: PDGM places a stronger emphasis on patient-centered care by focusing on the individual needs and characteristics of the patient, such as their clinical diagnosis, functional status, and other factors.
  2. 30-Day Periods: Payments are based on 30-day episodes of care rather than 60-day episodes under the previous system. This change allows for more frequent adjustments to the care plan based on the patient’s evolving needs.
  3. Clinical Grouping: Patients are categorized into one of 432 case-mix groups based on their clinical characteristics, diagnosis, and other factors. These groupings determine the base payment rate for the episode.
  4. Behavioral Adjustments: PDGM includes behavioral adjustments to account for potential changes in provider behavior in response to payment incentives.
  5. Elimination of Therapy Thresholds: The new model eliminates therapy visit thresholds and instead focuses on the patient’s overall needs to determine payment.
  6. LUPA Reform: Low-utilization payment adjustments (LUPAs) have been restructured to better align with patient needs and care patterns.
  7. Functional Levels: The patient’s functional status, as measured by the Outcome and Assessment Information Set (OASIS) assessment, is also factored into the payment. This assesses the patient’s ability to perform various activities of daily living.
  8. Comorbidities: The presence of comorbidities or other health conditions that may impact the patient’s care needs is considered in the payment calculation.
  9. Admission Source: The source from which the patient is admitted to home health care (e.g., from a hospital, from the community) can also affect the payment rate.
  10. Geographic Location: A geographic wage index is applied to account for variations in labor costs across different regions of the United States.

The combination of these factors determines the payment for each 30-day episode of care. The goal of PDGM is to promote more accurate and efficient reimbursement for home health services and encourage providers to deliver care that is tailored to each patient’s unique needs.