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How to Address the Ongoing LUPA Challenges

    During the COVID-19 pandemic and following the implementation of the Patient-Driven Groupings Model (PDGM), home health agencies faced considerable challenges managing Low-Utilization Payment Adjustments (LUPAs). Although some successfully adopted strategies to reduce LUPAs, many agencies continue to struggle.

    Current LUPA Landscape

    According to data from the National Association for Home Care & Hospice (NAHC), LUPA rates were causing a decrease in average reimbursement by approximately 75% for home health agencies during the height of the COVID-19 pandemic, which added strain to an already challenging situation.

    In 2020, nearly two-thirds of agencies reported that LUPAs had at least doubled, as revealed by NAHC data. This indicated the widespread struggle that agencies faced in managing LUPAs effectively.

    Based on CMS data up to Q3 of 2022 and further analysis by McBee Associates, the national average LUPA rate stood at approximately 7.6%. When breaking down the data, LUPA rates were found to be around 9.79% for the first 30-day period and 6.54% for subsequent periods.  These findings highlighted the variation in LUPA rates between different timeframes and the need for agencies to consider such variations for accurate assessment and monitoring.

    Home health agencies were advised not to solely rely on the overall LUPA average when analyzing their performance. Instead, the LUPA rates within the first 30 days should be assessed separately from the rates in later periods. By doing so, agencies could identify any inconsistencies and ensure they were on target with their LUPA management strategies.

    Interestingly, a closer look at the Q3 2022 data revealed that the majority of subsequent period LUPAs, almost 84%, were only a single visit short of meeting the LUPA threshold. This finding indicated that making simple adjustments during the second 30-day period could significantly benefit agencies still grappling with LUPAs.

    Overall, the struggle to minimize LUPAs has persisted for many home health agencies, even as some agencies implemented effective strategies. The financial impact of increased LUPA rates, the national average LUPA rate, and the variation between different timeframes underscored the ongoing challenges faced by home health agencies in managing LUPAs.

    How to Mitigate LUPAs

    Streamlining OASIS Documentation

    Some home health agencies have successfully adjusted to the changes brought about by PDGM, while others are still facing difficulties. The crucial factor lies in having efficient internal processes for timely coding and OASIS documentation.

    Under PDGM, the LUPA thresholds can vary for each patient over a 30-day period, making it important for agencies to closely monitor different LUPA thresholds and visit intensities for each patient. This can be effectively done when the OASIS is completed early on in the payment period.

    Once the OASIS is complete, the case-specific LUPA threshold can be identified as well through the home health resource group (HHRG) and Health Insurance Prospective Payment System (HIPPS) code. With the LUPA threshold being identified early on in the payment period, home health agencies can properly plot visit schedules, and anticipate and address missed or canceled visits, thus avoiding LUPAs.

    However, accomplishing this task is challenging, as various factors influence the timeliness of OASIS completion. These factors include the promptness of clinicians in submitting their OASIS and the turnaround time for the coding and QA review. Without streamlined processes, this can take up to 10 days or more, or about one-third of the payment period.

    Staff Education

    Home health agencies should prioritize educating their staff on best practices to prevent LUPAs. It is crucial to ensure that all staff members, including those involved in scheduling 30-day billing periods, are well-informed of the implications of moving visits and the importance of tracking their progress within the billing periods. Additionally, a thorough understanding of LUPA thresholds is essential for everyone involved to effectively manage and minimize LUPAs.

    Paying Attention to Patients’ Needs

    To prevent overwhelming the patient, it is advised to avoid scheduling too many visits within the first 30 days, including nursing, physical therapy, occupational therapy, and social work. Providing an excessive number of visits can lead to patient refusal and potentially contribute to LUPAs. Instead, spreading the care throughout the 60-day episode, both in the first and second 30-day periods, allows for better patient service and helps mitigate the risk of LUPAs.

    Reinforcing Clinical Operations for LUPA Prevention

    The added complexities in the new OASIS-E pose an increased challenge in completing OASIS documentation promptly. Clinicians will need additional administrative help and efficient solutions to help expedite OASIS documentation without compromising accuracy. Seeking expert support can play a significant role in alleviating this burden. This approach will allow for early identification of LUPA thresholds within each payment period, empowering agencies to strategically plan visit schedules and proactively address any missed or canceled visits. With third-party support to reinforce clinical operations, agencies can effectively avoid LUPAs and optimize reimbursement while maintaining a high standard of care for their patients.