On February 14, 2020, the Centers for Medicare and Medicaid Services (CMS) released its proposed rule and fact sheet for Medicaid’s required Preadmission Screening and Resident Review (PASRR). In this proposed rule, CMS intends to update the PASRR regulations for the first time since 1992 and incorporate statutory changes, update diagnostic criteria for mental illness (MI) and intellectual disability (ID), and reduce burdens on State programs. The proposed rule was published on February 20, 2020 and comments must be received by no later than 5 p.m. on April 20, 2020.

Changes to the PASRR regulations proposed in this NPRM include, but are not limited to:

• Updating obsolete definitions of MI and ID;
• Streamlining the Preadmission Screening process and expanding the number of exceptions to Preadmission Screening for individuals who seek nursing facility (NF) admission for brief, time-limited stays or for treatment of severe physical or cognitive conditions;
• Enabling PASRR programs to monitor the use of Preadmission Screening exceptions to ensure PASRR-eligible NF applicants are receiving appropriate evaluations and specialized services;
• Implementing statutory changes to the Resident Review requirements that are not reflected in current regulations;
• Authorizing the use of telehealth technology in performing evaluations of NF applicants and residents under certain circumstances;
• Simplifying the list of information that must be collected during evaluations and giving states greater flexibility in identifying the clinicians qualified to provide this data;
• Clarifying that Federal Financial Participation (FFP) is available for specialized services;
• Placing greater emphasis on the role of the individual’s preference for where to receive long-term services, including ensuring that the individual is aware of viable home- and community-based options before electing NF care; and
• Clarifying what data PASRR programs must report to CMS in order to demonstrate compliance with federal timeliness requirements and measure outcomes.

Authority for PASRR is from Section 1919(b)(3)(F) and (e)(7) of the Social Security Act and regulations governing PASRR are found in the Code of Federal Regulations, primarily at 42 CFR 483.100-138.

Background

Preadmission Screening and Resident Review was created from the Omnibus Budget Reconciliation Act of 1987 (OBRA ‘87) and is a federal requirement to help ensure that individuals are not inappropriately placed in NFs for long term care. It also advances person-centered care by assuring a person’s psychological, psychiatric, and functional needs are considered with personal goals and preferences in planning long-term care. PASRR requires that Medicaid-certified nursing facilities:

1. Evaluate all applicants for mental illness (MI) and/or intellectual disability (ID);
2. Offer all applicants the most appropriate setting for their needs (in the community, a nursing facility, or acute care settings); and
3. Provide all applicants the services they need in those settings.

PASRR is an important tool that states use to rebalance services away from institutions and towards supporting people in their homes. Under the Americans with Disabilities Act, individuals with disabilities cannot be required to be institutionalized to receive public benefits that could be furnished in community-based settings.

In brief, the PASRR process requires that all applicants to Medicaid-certified nursing facilities be given a preliminary assessment to determine whether they might have MI or ID. This is called a “Level I screen.” Those individuals who test positive at Level I are then evaluated in depth, called “Level II” PASRR. The results of this evaluation result in a determination of need, determination of appropriate setting, and a set of recommendations for services to inform the individual’s plan of care.

Incorporate Statutory Changes

CMS published its final rule specifying the PASRR requirements on November 30, 1992 (57 FR 56540). On October 19, 1996, Pub. L. 104-315 removed a requirement that Resident Review be performed annually and provided instead that Resident Review should be performed upon a significant change in the resident’s physical or mental condition. CMS has not issued additional regulations since the final rule in November 1992, so current regulations do not reflect this statutory change. Thus, numerous statutory changes made since 1992 are reflected in this proposed rule.

Definitions Related to Institutional Status (435.1010)

Section 435.1010 provides the definition for ‘‘persons with related conditions,’’ which is also commonly referred to as ‘‘developmental disabilities.’’ Currently, 42 CFR 435.1010 contains one use of the outdated term ‘‘mentally retarded persons,’’ which CMS proposes to replace with ‘‘people with intellectual disabilities.’’

Resident Assessments (483.20)

CMS proposes to move, delete, or revise certain provisions from 483.20 (resident assessment) that are outside the scope of resident assessment or more applicable to PASRR. Despite some similarities and overlap between resident assessments and PASRR evaluations, the two are distinct statutory requirements. Whereas resident assessments are the responsibility of the NF, PASRR evaluations are the responsibility of the State Mental Health Authority (SMHA) and State Intellectual Disability Authority (SIDA). Unlike PASRR evaluations, resident assessments are performed for all NF residents, not just those with MI or ID. And finally, the timing and content for resident assessments and PASRR evaluations are also different. But for those areas that overlap, the existing Section 483.20(e) implements the requirement at section 1919(b)(3)(E) of the Act that NFs coordinate Preadmission Screening with resident assessments to the greatest extent practicable.

CMS proposes to replace the broad term ‘‘mental disorder’’ with the narrower term ‘‘mental illness’’ in order to indicate mental disorders that do not include neurodevelopmental or neurocognitive disorders. Because there is much discussion in the behavioral health community about appropriate terminology, CMS is soliciting feedback on this proposal.

New Definitions of MI & ID (483.102)

The current diagnostic criteria for MI and ID use the ‘‘Diagnostic and Statistical Manual of Mental Disorders, 3rd edition’’ (DSM–III–R), which was released in 1987. The DSM is currently in its 5th edition (DSM–5), published in 2013. The DSM–5 does not categorize disorders the same way as DSM–III–R. As a result, clinicians must currently crosswalk diagnoses made using the DSM–5 with the categories of mental disorders in the DSM–III–R. Thus, CMS proposes to update the definitions of MI, dementia, and ID at 483.102(b)(1)-(3) to reflect updated diagnostic criteria [changes underlined]:

Mental Illness: An individual is considered to have a mental illness (MI) if:

• The individual has within the past year had a serious and persistent mental disorder meeting the criteria specified within the Diagnostic and Statistical Manual of Mental Disorders, 5th edition (2013), incorporated by reference in paragraph (c) of this section, with the exception of conditions that would fall under DSM–5 ‘‘V’’ codes, substance use or substance/medication-induced disorders, neurodevelopmental disorders, and neurocognitive disorders;
• The disorder has been determined by a qualified clinician to be acute or in partial remission, have recurrent or persistent features and, if the DSM includes a severity scale for the disorder, the severity level of the disorder is moderate to severe;
• The disorder has resulted in functional impairment which has substantially interfered with or limited one or more major life activity (including activities of daily living; instrumental activities of daily living; or functioning in social, family, and academic or vocational contexts), or would have caused functional impairment without the benefit of treatment or other support services; and
• A qualified clinician has found that the mental illness is not a secondary characteristic of a primary diagnosis of dementia (or neurocognitive disorder due to Alzheimer’s disease or related conditions), as defined in paragraph (b)(2) of this section.

Dementia: An individual is considered to have dementia if he or she has a primary diagnosis of a major neurocognitive disorder (other than delirium) as described in the Diagnostic and Statistical Manual of Mental Disorders, 5th edition, revised in 2013. An individual with co-occurring diagnoses of MI and major neurocognitive disorder would not be automatically considered to have ‘‘primary dementia’’ unless a qualified clinician has confirmed that the individual’s primary diagnosis is a major neurocognitive disorder.

Intellectual Disability: An individual is considered to have intellectual disability (IID) if he or she has – (i) A disability, with onset before age 18, which is characterized by significant limitations in both intellectual functioning and adaptive behavior, as described in the American Association on Intellectual and Developmental Disabilities’ Intellectual Disability: Definition, Classification, and Systems of Support, 11th edition (2010), incorporated by reference in paragraph (c) of this section; or (ii) a related condition as defined by § 435.1010 of this chapter.

Preadmission Screening (483.112)

In this section, CMS proposes to reorganize and expand on the requirements for Preadmission Screening. Per section 1919(b)(3)(F) of the Act, Preadmission Screening instructs that ‘‘new resident[s]’’ with MI or ID cannot be admitted to a NF unless the SMHA or SIDA has determined ‘‘prior to admission’’ that the individual needs NF level of services and any specialized services.

• Clarification of who would be required to receive Level I identification and Level II preadmission screening prior to NF admission. CMS believes this definition of Preadmission Screening accurately reflects sections 1919(b)(3)(F) and 1919(e)(7)(A) of the Act, which only specifically includes the evaluation and determination process [483.112(a)-(b)];
• Preserve existing language that defines exempted hospital discharge but clarification that these are considered new admissions. This means that while they are exempted from Preadmission Screening (Level II), they are not exempted from Level I identification screening [483.112(b)(2)];
• Add a second exemption to Preadmission Screening, called a ‘‘provisional admission,’’ which is defined as a new admission in which the individual is only admitted to a NF for short, time-limited stays, and thus is not considered a ‘‘new resident’’ for PASRR purposes [483.112(b)(3)];
• Relocate and revise current 483.106(b)(3)-(4) defining readmissions and inter-facility transfers. CMS proposes that these cases are treated similarly in that residents who received a Level I screen and Level II evaluation and determination (if needed) at initial admission do not need these processes repeated but are still subject to resident review [483.112(b)(4)-(5)]; and
• Propose that all Level II determinations be made within, on average, 9 calendar days of the Level I referral in order to streamline timeframes. CMS also proposes to add that Level II evaluation and determination would have to be completed prior to admission [483.112(c)(1)].

Resident Review (483.114)

CMS proposes to replace all references to the Annual Resident Review requirement at § 483.114(e) with language on how states’ PASRR programs may implement section 1919(e)(7)(B)(iii) of the Act, which requires that Resident Review be performed when there has been a ‘‘significant change in the resident’s physical or mental condition. CMS proposes at 483.114(a) to specify that a referral for Resident Review would be required when:

1. A resident with known MI or ID experiences a possible significant change in physical or mental condition, as defined in § 483.20(b)(2)(ii);
2. Upon the expiration of an exempted hospital discharge or provisional admission;
3. When the NF identifies, through any means not otherwise described in this section, that a resident has a possible MI or ID (as described in § 483.126) that was not previously identified by a preadmission screen or resident review; or
4. Upon other conditions designated by the State.

CMS proposes in 483.114(b)-(d) a definition of Resident Review, requirements for when a NF would refer residents for Resident Review, and timeframes for completing a Level II determination.

Specialized Services and NF Services (483.120)

This section contains provisions describing specialized services, which are a central component of PASRR. CMS proposes to revise and combine the definitions of ‘‘specialized services’’ as state-defined services for NF residents with MI or ID that meet the criteria in new 483.120(a):

• Developed by an interdisciplinary team, that would include, at minimum, a physician and a mental health professional (for MI) or intellectual disability or developmental disability professional (for people with ID or related conditions);
• Designed to address needs related to MI or ID;
• Of greater intensity, frequency or customization than the NF services for MI or ID required in part 483, subpart B;
• Designed in a person-centered manner that promotes self- determination and independence,
• Designed to prevent or delay loss of, or support increase in, functional abilities; and
• If the individual is admitted to or remains in an institutional setting, designed to support any goals the individual may have of transition to the most integrated setting appropriate.

CMS also specifies in this section that specialized services may not duplicate the services NFs must provide under their conditions of participation and for which they are already reimbursed.  It also proposes to give states flexibility in deciding the qualifications of who may deliver specialized services and that these services are periodically reviewed.

Level I Identification Criteria (483.126)

CMS proposes to replace the existing 483.126 with requirements that describe the Level I identification process. Despite being a critical precursor to the PASRR process, the Level I identification process is not described in current regulation. In this section, CMS proposes to add:

• Expectation that a state PASRR program must have a Level I screening process to identify all individuals with possible MI or ID who require Preadmission Screening (if they are NF applicants) or Resident Review (if they are residents) [483.126(a)];
• Criteria for identifying “possible MI or ID” used during the Level I process [483.126(b)-(c)];
• State authority to designate qualifications for who may complete Level I screen [483.126(d)];
• Clarification that screeners would be able to rely on existing records, including hospital records, physician’s evaluations, election of hospice status, school records, records of community mental health centers or community Intellectual/developmental disability providers, and other information provided by the individual or their legally authorized representative [483.126(e)];
• Requirement that individuals with possible MI or ID be referred to the PASRR program for Level II evaluation and determination, unless they qualify for an exemption to Preadmission Screening due to a hospital discharge exemption or provisional admission [483.126(f)]; and
• Written notification of individual that is ‘‘suspected of having’’ MI or ID and is being referred to the SMHA or SIDA for Level II evaluation and determination [483.126(g)].

Level Ii Evaluation Criteria (483.128)

This section describes the criteria that must be used to perform the physical and mental evaluations on which the Level II determinations must be made.

• Clarification that the purpose of the evaluation is to provide the SMHA or SIDA with enough information to confirm that the individual has MI or ID, or to confirm that the individual has experienced a qualifying significant change in physical or mental condition; and to make the determinations regarding need for a NF level of services and specialized services [483.128(a)];
• Authorization for state to specify the mental health, intellectual disability or developmental disability professionals who may perform the evaluations [483.128(b)];
• Interdisciplinary coordination of evaluations (e.g., individuals have both MI and ID) [483.128(c)];
• Specify the data used to confirm an individual has MI or ID and the data used to assess the need for NF level of services and specialized services [483.128(d)-(e)];
• Expectation that person-centered interviews in proposed 483.128(e)(10) be conducted face-to- face and that CMS proposes to allow telehealth evaluations via live videoconferencing if conducting a face-to-face interview would, due to resource limitations, geographical distances, or other circumstances, prevent timely completion of the determination [428.128(f)]; and
• Other provisions are retained with minor revisions.

Level Ii Determination Criteria (483.130)

Section 483.130 sets out the criteria used to make determinations of the need for NF level of services and for specialized services.

• Discontinue categorical determinations as they are “cumbersome and counterproductive” and replaced by the proposed provisional admissions [remove existing 483.130 (b)-(i)];
• Authorization for state to specify the mental health, intellectual disability or developmental disability professionals who may perform the determinations [new 483.130(b)];
• Criteria for making a determination regarding the need for NF level of services and specialized services [new 483.130(c)-(d)];
• Remove requirements for placement options and the provision of specialized services based on determinations as these are duplicative of other requirements [remove existing 483-130(m)-(n)];
• Other provisions are retained and re-designated with minor revisions or are specific to State operations.