Fazzi Associates, Inc.

Question: We saw that MedPAC has listed the new average case mix weight at RAP as being 1.27, up from 1.23. Does this have any implications for our agency?

Answer: We first saw this new rate in an earlier report issued by Abt Associates. Now MedPAC has verified that the new average case mix weight for all patients in the U.S. has increased to 1.27. This number is derived from OASIS assessments..

What MedPAC has also done is give you a new benchmark. If you believe that your patients' medical needs are equal to or greater than the average patient, then your case mix weight should be equal to or higher than the average case mix weight of 1.27. What happens if your patients' needs are equal to or greater than the average patient's, but you inaccurately underscore your OASIS assessment? You lose and you lose big in two ways.

Impact on Quality: First, your quality scores! If your OASIS assessments underscore, in other words, rate your patients' care management needs as less than they really are, it will be much more difficult for you to show appropriate outcomes. Most Home Health Compare quality scores are a measure of improvement based on OASIS assessments at two different time points. Underscore on admissions and you leave little room to show appropriate improvement. Result: poorer quality scores and poorer Home Health Compare scores even though you may have done an outstanding job.
Impact on Revenue: What about revenue? If you underscore, you get less revenue. It's as simple as that! There are many agencies who are experiencing financial pressure simply because inaccurate underscoring results in less revenues essential to covering the cost of patient services. This has the potential of being a serious problem for some agencies. For example, look at the difference in revenue based on the old and new average case mix weight.

Annual Episodes	Standard Episodic Rate	Revenue at Old 1.23 Average CMW	Revenue at New 1.27 Average CMW	Revenue Difference
100 Episodes	$2,312.94	$284,492	$293,743	$9,252
300 Episodes	$2,312.94	$853,475	$881,230	$27,755
500 Episodes	$2,312.94	$1,422,458	$1,468,717	$46,259
1,000 Episodes	$2,312.94	$2,844,916	$2,937,434	$92,518
2,000 Episodes	$2,312.94	$5,689,832	$5,874,868	$185,035

Now, imagine that your case mix weight is not 1.27 or even 1.23 and that your actual average is 1.15 or 1.10 or worse, below 1.00. The impact on your quality outcomes and financial payments could be devastating.

A Simple Solution

Assuming that your patients' conditions are equal to those of the general population and you are underscoring, you can easily address this issue. First, find your actual case mix weight at RAP. This is a standard report from every IS vendor as well as every data analysis vendor. Still can't get it? Invest in a low cost tracking system. Fazzi's OASIS Tracker, for example, is a $200/year automated system that will give real time status of your case mix weight, primary diagnosis, and other clinical information.
What you do next depends on what you learn. Consider this simple guideline chart:

If Your CMW at Rap is...	Strategy You Should Use
1.27 or higher	Monitor: Track and trend your case mix weight at RAP and final. Provide annual training updates.
1.20 - 1.27	Train: Track and trend your case mix weight at RAP and final. Initiate internal training programs.
1.05 - 1.20	Focused Response: Get outside help. Have your assessments audited to identify problem areas, and develop a training that addresses these areas. Track your case mix weight at RAP and final.
Less than 1.05	Urgent Response: Get outside help immediately. Have your assessments audited to identify problem areas, and develop a training that addresses these areas. Track your case mix weight at RAP and final.

Thanks to MedPAC, we now have a clear statement of the national average case mix weight at RAP. And once you know where you stand, you can guide your own course of action. Best of all, in nearly every case, the cost of the intervention will be far exceeded by the increase in revenues (and quality scores) that more accurate assessments will provide.