Since Occupational Mix Surveys are only required every three years, it is easy to forget about them. However, the surveys are due July 1, 2011!
What is it?
The Occupational Mix Survey reports a PPS facility's nursing employee mix. The data from the survey is used to calculate an adjustment factor to the facility's Medicare payments through the wage index. CMS uses this factor to adjust for whether the facility's nursing employee mix is relatively more expensive than the average in the country. Broadly speaking, if a hospital uses more of the relatively expensive RNs than the national average, CMS will reduce how much they pay that hospital under the Medicare program. CMS' basic premise is they shouldn't have to pay facilities more just because they choose to use more RNs when they could use LPNs or Nurse Aides.
What Is the Financial Impact?
The Occupational Mix adjustment can either raise or lower the labor portion of Medicare payment, which is roughly 2/3 of Medicare payments. The adjustments for fiscal year 2011 in different parts of the country have ranged from -3.97 percent to 7.81 percent. As an example, a facility with an unadjusted wage index of 1.0 and $100 million in Medicare payments would see a difference in Medicare payments between the lowest and highest Occupational Mix adjustments of almost $8 million!
What is your strategy?
Since this process is important to Medicare payments, it is important to have a strategy to assess where your organization stands and potentially consider opportunities to optimize the results. The assessment and strategy considerations should incorporate human resources, payroll, accounts payable and finance to achieve the most appropriate and potentially optimum results. Human resource input can be very helpful for understanding what job classes correspond to which categories of the Occupational Mix Survey. Payroll is needed to generate the reports on salaries and hours by job class and department. Accounts payable may be instrumental in generating the contract labor reports. The finance area will need to understand how to assess the information and pull the analysis together to ensure you are getting accurately paid by Medicare.
If you would like more detailed information or have any questions, please contact your Eide Bailly professional.
