Best Practices for Coding Under PDGM


Since the implementation of the Patient-Driven Groupings Model (PDGM) in 2020, there have been new complexities in home health coding that have made it challenging for agencies to optimize reimbursements. Data from 2020 revealed that home health organizations did not meet CMS reimbursement projections in the first year of PDGM. Total home health case payments distributed came out to nearly $1 billion less than anticipated. Although the COVID-19 crisis was a big contributing factor to this, it is still undeniable that agencies have a long way to go in improving processes that directly impact reimbursement, such as coding.

More than a year after the PDGM rollout, agencies may have the basic knowledge of how PDGM coding works. However, knowing best practices based on actual cases can make a significant difference in further realizing ideal reimbursement values.


Quick Review of Basic Coding Principles

Accurate coding requires professional responsibility to ensure code assignment comes from the proper documentation sources. There are specifics necessary to support the assignment of specific codes on the claim. Often, certain codes present unique challenges when supporting information within the clinical documentation is absent.

Here’s a quick review of the basics needed in proper documentation for accurate and compliant code assignment:

  • The physician or qualified provider must state or confirm all diagnoses.
  • Never assign diagnoses if the provider uses indefinite terms, such as “likely,” “suspected” or “consistent with.”
  • Take note that diagnoses cannot be assigned from lab reports or imaging without a physician’s interpretation of those results confirming the diagnosis.
  • Reference data from supporting medical records to justify code assignment.


Coding Tips and Best Practices

1. Comorbidities

Focus on high-risk diagnosis (DX) codes and ensure they are addressed in the Plan of Care (POC).

Ensure wounds and skin conditions are properly and specifically described in the documentation. The latter is a major part of comorbidities.

There are 31 High Comorbidity Adjustment Interaction Subgroups and 20 of them have interactions with either a non-pressure chronic ulcer or with a pressure ulcer. This includes diseases of arteries, arterioles, and capillaries with ulceration and non-pressure, chronic ulcers or a pressure ulcer which includes stages two through four and unstageable pressure ulcers. Therefore, in only 11 of the interaction subgroups for a high comorbidity adjustment can the patient be without a non-pressure ulcer or a pressure ulcer.

2. Coding Specificity

Generally, codes with unspecified anatomical location and laterality are unacceptable but with a few exceptions.

a) Dysphagia codes – R Codes (which are symptoms, signs, and abnormal clinical and laboratory findings, not elsewhere classified) are not allowed as a primary diagnosis, except for a few dysphagia codes. In the CY 2020 final rule, CMS determined that given the current lack of other definitive diagnoses to describe certain forms of dysphagia, the R-codes to describe dysphagia would be acceptable for reporting the primary reason for home health services. Therefore, the following R-codes will be assigned to the Neuro Rehab clinical group: R13.10, R13.11, R13.12, R13.13, R13.14 & R13.19 – Multiple Dysphagia codes

b) S and T codes – There are many of the S and T codes where the fracture and/or injury is unspecified, but the site is specified, which CMS maintains should be identified. However, the treatment or intervention would likely not change based on the exact type of injury or fracture. Many of these codes are appropriate to put into a clinical group, and are assigned to either the musculoskeletal group or the wounds group.

3. Secondary DX Code Sequencing

Positioning of codes can change a claim’s clinical grouping and can trigger adjustments in the reimbursement level. Diagnoses sequencing (knowing which are primary and secondary) can be complex. Diagnosis identified as the primary reason for home health and documented by the physician on the face-to-face encounter could actually be in the first secondary diagnosis, rather than the primary due to such rules as manifestation, etiology codes, or “code first” coding instructions. The primary service and highest frequency of discipline must be taken into account when assigning a primary diagnosis. Considering all of these factors, there can be variations in the diagnoses sequencing.

4. Complete and Specific Documentation

The key to accurate coding under PDGM is to have very specific documentation from physicians and/or referral sources. Here are some things agencies can do to ensure proper documentation:

a) Ask for the underlying cause if an unacceptable primary diagnosis is given by the referral source or physician. The underlying cause is often an acceptable primary diagnosis.

b) Analyze all supporting medical records. Many of the supporting medical records can give insight into code assignment or provide reasons for needed provider queries. Some forms of documentation that can substantiate information related to code assignment include the history and physical (H&P), discharge summaries, operative reports, labs and imaging with interpretation and progress notes.

5. Referral and Intake

More than making sure that referral documentation is complete, it would be very efficient if the intake team can do an initial check if the information in the documents are sufficient and substantial. This enails building a strong collaboration with referral sources. Common issues include missing information in referrals, hard-to-reach referral sources, and gaps in staff knowledge about clinical groupings. Some basic solutions to address these issues are to implement scripting for the intake staff and create a checklist of specific information the intake staff should look for in the documents—this should include the following:

• Specifically stated referral source
• Home health principal diagnosis
• Physician face-to-face encounter and supporting documentation
• Patient secondary diagnosis information for comorbidities
• Requested services

Realizing Reimbursement Objectives

Since coding is an essential part of both the clinical and business aspect of home health, coders need to be equipped with the right knowledge and skills of analyzing documentation to maintain compliance while optimizing reimbursement values. It is a complex function that requires not only the coders’ proficiency, but also a successful collaboration of various stakeholders such as physicians, clinicians, and the intake team. If the documentation is incomplete or inaccurate, revenues under PDGM can be severely impacted, and worse, patients may not get the care they need. It’s important to get the nitty-gritty details right so that the bigger picture of reaching reimbursement goals can be accomplished.