Wayne Walter Dyer is an American self-help author and motivational speaker who has been quoted as saying “If you change the way you look at things, the things you look at change.”  Such is the case with the release of the PEPPER reports to skilled nursing facilities.

We have all become accustomed to the idea that third party auditors are looking at our therapy utilization and comparing our data with those in peer groups such as the state and national averages.  As a company, we have built our peer audit review process around the selection of facilities who may pose the most risk of a third party audit and do so by looking a therapy RUG utilization by comparing facility percentages to national average percentages.

The PEPPER reports have presented a different way of looking at the data by comparing the facility percentages of Ultra High Therapy and Therapy RUGS to a SNF National percentile, a SNF State percentile and a SNF (or MAC) Jurisdiction percentile.  Percentiles at or above the 80^th percentile indicate that the facility may be at a higher risk for improper Medicare payments.  The reports specify that the greater the percentile value, in particular the national and/or jurisdiction percentile, the greater consideration should be given to that target area.

For example, one of our clients had 95.8% utilization for therapy RUGs We were considering this client to be an “outlier” and at risk for third party audit since the national average is 89%.  However, their PEPPER report reflects that 95.8% therapy RUG utilization places them at the 73.6 SNF National percentile and the 71.8 SNF Jurisdiction percentile—below the 80^th percentile and therefore, not really an “outlier” at all.

So does this mean I am recommending that we all let our guard down if our Ultra High Therapy and Therapy RUG utilization is below the 80^th percentile according to the facility PEPPER report?  Those of you who know me well will understand when I say not at all—in today’s environment of heightened scrutiny on therapy services we always must be on guard.  I am simply saying, there is more than one way to look at facility data and the key to supporting therapy RUG utilization lies in the documentation of medical necessity, which should always be considered a key component of a facility’s quality assurance and performance improvement program.