|(a) The Resource Utilization Group (RUG-III) 34-group
classification system has seven major classification groups. The groups
represent the recipient's relative direct care resource requirements.
(b) The Activities of Daily Living (ADL) score is based
on the recipient's care needs that are provided by the nursing facility
staff. The ADL score is used to determine a recipient's placement
in a RUG-III category and is based on the recipient's care needs provided
by the nursing facility staff. The score is incorporated into acuity
measurements established under the RUG-III recipient classification
methodology. The clinical record must support items claimed for Medicaid
reimbursement on the Minimum Data Set (MDS).
(c) The state-specific Long-Term Care Medicaid Information
Section is a part of the MDS assessment Resident Assessment Instrument
(RAI) in Texas and must be completed for Medicaid reimbursement. The
Long-Term Care Medicaid Information Section must include the last
name and license number of the registered nurse (RN) assessment coordinator.
(d) The Basic Tracking Form must include:
(1) the signature and title of each licensed nurse
or health care professional completing any section of the MDS assessment
for Medicaid reimbursement; and
(2) the section(s) and completion date(s) corresponding
to the signature of the nurse or health care professional.
(e) Each individual signing the signature section on
the Basic Tracking Form is certifying that the information entered
on the MDS assessment is accurate. A facility that submits false or
inaccurate information is subject to sanctions under Subchapter G
of this chapter (relating to Administrative Actions and Sanctions).
(f) If the nursing facility recipient is a hospice
recipient, the nursing facility must comply with the requirements
of 40 TAC §19.1926 (relating to Medicaid Hospice Services) and
maintain in the recipient's clinical record copies of the completed
Texas Medicaid Hospice Program Recipient Election/Cancellation/Discharge
Notice (Form 3071), and the DADS Medicaid/Medicare Hospice Program
Physician Certification of Terminal Illness (Form 3074).
(1) The nursing facility must acknowledge a recipient's
admission to hospice services on the Special Treatments, Procedures,
and Programs section when completing an MDS full, comprehensive, or
(2) An MDS assessment indicating that a recipient has
elected hospice services is not processed until the Texas Medicaid
Hospice Program Recipient Election/Cancellation/Discharge Notice (Form
3071), and the DADS Medicaid/Medicare Hospice Program Physician Certification
of Terminal Illness (Form 3074) are received by the Texas Medicaid
(3) When a recipient is admitted to hospice and there
has not been a significant change in condition, a significant change
in status assessment does not have to be completed. The recipient's
next scheduled assessment may be used.
(g) Each nurse's license number submitted on the MDS
assessment, Long-Term Care Medicaid Information Section, is validated
with the Texas Board of Nursing or as applicable as a nurse compact
license with the licensing state. An MDS assessment is rejected for
Medicaid reimbursement if an invalid or delinquent license number
is submitted on the MDS assessment, Long-Term Care Medicaid Information
(h) Nursing facility staff must complete the HHSC-approved
MDS training in accordance with this subsection.
(1) The nursing facility RN Assessment Coordinator
must complete the HHSC-approved online MDS training course prior to
completing an MDS assessment for Medicaid payment. All other staff
completing the MDS assessment for Medicaid payment are encouraged
to take the MDS Training prior to completing the MDS assessment.
(2) The nursing facility RN Assessment Coordinator
must repeat the MDS online training every two years. A certificate
of completion is issued at the conclusion of the training.
(3) If the nursing facility RN Assessment Coordinator
does not complete the MDS training every two years as required by
HHSC, the license number of the RN Assessment Coordinator is not accepted
into the state database and the MDS assessment is rejected by the
Medicaid claims administrator.
(i) An admission assessment, a quarterly assessment,
significant change in status assessment, annual assessment, significant
correction to a prior quarterly assessment, or a significant correction
to a prior annual assessment establishes a RUG-III group.
(1) A significant change in status assessment, which
requires a comprehensive MDS with Resident Assessment Protocols, must
be completed by the end of the 14th calendar day following determination
that a significant change has occurred.
(2) A significant change in status assessment resets
the schedule for the next annual assessment.
(j) Permanent medical necessity is determined by DADS
in accordance with 40 TAC §19.2403 (relating to Medical Necessity
(k) When correcting errors in an MDS assessment, the
nursing facility staff must use the MDS Correction Policy in Chapter
5 of the Minimum Data Set, Resident Assessment Instrument User's Manual,
published by CMS.
(1) Documentation must be maintained in the clinical
record to support the corrected MDS assessment form and be available
for review by the OIG staff during MDS utilization reviews.
(2) The Correction Request Form attestation of accuracy
of signatures must contain the RN assessment coordinator's and Director
of Nursing's signatures, and the date the correction was completed.
(3) A correction to a RUG reclassification error identified
during an on-site review is considered an assessment error as described
in subsection (r)(2) of this section. This does not negate the facility's
responsibility to make quality of care corrections pursuant to the
CMS MDS Correction Policy referenced in this section.
(l) The MDS assessment establishes the rate(s) at which
the Texas Medicaid program pays a nursing facility or hospice provider
for the facility's hospice residents to support the care the nursing
facility's residents receive and any information on the MDS RAI is
considered part of each corresponding claim for Medicaid reimbursement.
(m) Prior to entering a nursing facility for review,
the OIG identifies a population of paid claims from which a sample
(1) The population is defined as claims associated
with RUG classifications:
(A) paid to the nursing facility, or hospice provider
for the facility's hospice residents, for a specified time period;
(B) that meet certain criteria, such as dollar or claim
volume, as determined by the OIG.
(2) The OIG identifies the population of paid claims,
along with their related RUG classifications and MDS assessment claim
forms, from which a statistically valid random sample is drawn for
review. The sample generated is a statistically valid random sample
generated at a minimum confidence level of 90 percent and a maximum
precision of ten percent. Related extrapolations are done at the lower
limit of the applicable confidence interval.
(n) Utilization reviews are conducted in accordance
with this subsection.
(1) OIG nurse reviewers conduct unannounced on-site
MDS utilization reviews of nursing facilities. The OIG selects nursing
facilities for an on-site review by conducting a comprehensive annual
review of all facilities, considering factors such as:
(A) length of time since the last on-site review;
(B) whether the nursing facility has ever been reviewed;
(C) previous review results;
(D) compliance history of the nursing facility;
(E) nursing facilities with claims in high-dollar reimbursement
categories such as rehabilitation, extensive services, and special
(F) variances in billing patterns;
(G) data analytics indicating potential fraud, waste,
or abuse; and
(H) complaints and referrals.
(2) The unannounced on-site review period begins when
an OIG nurse reviewer presents an entrance letter to the facility,
and ends when the OIG nurse reviewer informs the facility that the
unannounced on-site review is completed. The unannounced on-site review
period is subject to the provisions in subparagraphs (A) - (D) of
this paragraph. The unannounced on-site review period does not include
the exit conference, which is described in paragraph (3) of this subsection.
(A) The nursing facility shall provide the OIG nurse
reviewer initial access to clinical records and resources the OIG
nurse reviewer determines are necessary to initiate the unannounced
on-site review process within two hours of entrance to the nursing
facility. Although the facility is not required to produce all records
within two hours, documentation to be reviewed must continue to be
made available to the OIG nurse reviewer during the unannounced on-site
review period. If the facility indicates that necessary records or
resources are located off-site or otherwise unavailable for immediate
retrieval, and the facility can substantiate this fact, the OIG grants
an extension to the two-hour initial production of records requirement.
(B) The nursing facility, upon the OIG nurse reviewer
request, must provide the signed and notarized Records Affidavit described
in subsection (q)(4) of this section for each MDS assessment for which
copies of clinical record documentation are provided to the nurse
reviewer, attesting that the facility used its best efforts to obtain
all relevant records, and that the documentation provided to the OIG
nurse reviewer is as complete a compilation as was possible during
the unannounced on-site review period. If the nursing facility refuses
to provide the required Records Affidavit, the nursing facility must
state the refusal in writing and attach the statement to the records
provided to the nurse reviewer.
(C) The nursing facility must ensure an assigned staff
member knowledgeable of the MDS and clinical record is available at
the facility to the OIG nurse reviewer during the entire unannounced
(D) When the OIG nurse reviewer identifies an item
coded on the assessment that cannot be substantiated or does not accurately
reflect the recipient's status during the applicable look back period,
the OIG nurse reviewer notifies the assigned nursing facility staff
and requests supporting documentation.
(i) The nursing facility must provide the requested
supporting documentation to validate the coded items to the OIG during
the unannounced on-site review period and prior to the exit conference.
(I) If the unannounced on-site review period is more
than one day, the nursing facility must provide the requested information
during regular business hours to the OIG reviewer by the end of the
day the documentation was requested, provided, however, that the facility
will be allowed a minimum of six business hours in which to provide
(II) Nothing in this provision shall be construed to
affect the timing of an exit conference or require the reviewer to
incorporate an overnight stay near the facility. It shall be the facility's
responsibility to submit the supplemental records to the reviewer's
place of business. The reviewer's exit conference conclusions and
error rates may change after reviewing the supplemental records. Any
such changes are communicated to the provider within one business
(III) If a facility cannot produce or make available
the requested information, the facility must provide a written statement
explaining why the information cannot be provided as requested. The
submission of a written statement does not negate the OIG's authority
to take enforcement action under Subchapter G of this chapter.
(ii) Lack of documentation to validate the items claimed
on the MDS as described in this paragraph may be the basis for an
error and RUG III group reclassification.
(iii) Lack of documentation, inconsistent documentation
that misrepresents the patient's actual condition at the time it is
documented, or altered documentation, which does not follow generally
accepted error correction guidelines such as the MDS Correction Policy
in Chapter 5 of the Minimum Data Set, may be the basis for an error
and adjustment in the RUG-III group. The error or adjustment is made
based on a review of the clinical record documentation provided for
the look-back period of the MDS assessment.
(3) The OIG nurse reviewer holds an exit conference
with nursing facility staff.
(A) The exit conference is held with the nursing facility
staff at the conclusion of the unannounced on-site review period.
Hospice staff is encouraged to attend to discuss the review findings
of the MDS assessments for hospice recipients for whom the representative
provided hospice services.
(B) The OIG nurse reviewer provides the nursing facility
representative(s) in a leadership position(s) (e.g., the administrator,
Director of Nursing, charge nurse) formal written notification of
all MDS validation findings during the exit process.
(i) If a hospice representative is present at the exit
conference, written notification is provided only on recipients to
whom they provided services.