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Following completion of this chapter, the reader will be able to:

  • Understand who is responsible for completing the Minimum Data Set (MDS).

  • Describe the role of the Minimum Data Set (MDS) in patient care in a Skilled Nursing Facility (SNF).

  • Explain how each of the 20 Care Area Assessment (CAA) areas is related to physical therapy.

  • Describe the Resident Assessment Instrument (RAI) processes and the relationship to the Minimum Data Set (MDS).

  • Explain the theory of the Patient-Driven Payment Model (PDPM).


The Skilled Nursing Facility (SNF) Patient-Driven Payment Model (PDPM) began October 1, 2019 (the start of Medicare’s fiscal year 2020), marking a significant difference in the SNF payment system. PDPM replaced the Resource Utilization Group (RUG) reimbursement model.


The Resident Assessment Instrument (RAI) consists of three basic components: the Minimum Data Set (MDS) Version 3.0, the Care Area Assessment (CAA) process, and the RAI Utilization Guidelines.

The MDS (see Figure 8-1) is used for an important set of processes beyond the Prospective Payment System (PPS).1 The MDS is a data collection tool designed to cue facilities to develop care plans that will affect critical components of a resident’s health and quality of life. MDS data is also used to assist state agencies in monitoring the quality and safety of skilled nursing facilities.

Under the PDPM (effective October 1, 2019), there are three SNF PPS assessments: the 5-day assessment, the Interim Payment Assessment (IPA), and the PPS Discharge Assessment. The 5-day assessment and the PPS Discharge Assessment are required. The IPA is optional and will be completed when providers determine that the patient has undergone a clinical change that would require a new PPS assessment. The goal of this change was to improve payments by focusing on the patient rather than the volume of services provided.4

The schedule of PPS assessments under PDPM may be found in Table 8-1.

Table 8-1Schedule of PPS assessments under PDPM

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