Texas PDPM Panic: September 1st Countdown Begins

Texas operators are freaking out. September 1st is coming and nobody knows if they'll survive the switch.

What's Actually Happening

Texas is switching from RUG-III to PDPM (Patient-Driven Payment Model) for nursing home payments. If you're reading this and don't know what that means, here's the translation:

Current System (RUG-III): Texas pays nursing homes based on how much care each patient needs - physical therapy minutes, nursing hours, that kind of thing. More services = more money.

New System (PDPM): Starting September 1st, payments are based on the patient's actual medical condition and diagnosis. Same patient, completely different math.

Think of it like this: Instead of paying your babysitter based on how many activities they do with your kid, you'd suddenly start paying them based on what grade your kid is in. Totally different calculation, and nobody knows if they'll make more or less until report card day.

Why Operators Are Panicking

Early estimates show some facilities could see 15-30% revenue drops. Others might get increases. The problem? Nobody knows which bucket they're in until September 1st hits.

One Dallas operator told us: "It's like playing Russian roulette with my entire business model."

The Real Issues

Cash Flow Nightmare: Even if your facility eventually comes out ahead, the transition period could kill your cash flow. Budget accordingly.

Therapy Changes: Under RUG-III, more therapy meant more money. Under PDPM, therapy revenue is capped. Therapy-heavy facilities are especially nervous.

Documentation Hell: PDPM requires different documentation. If your MDS coordinators aren't ready, you're screwed.

Staffing Adjustments: The optimal staffing model under PDPM might be completely different from what works now. Some facilities will be overstaffed, others understaffed.

What Smart Operators Are Doing

• Running dual calculations NOW on current patients to see where they'd land under PDPM

• Training MDS coordinators obsessively on new assessment requirements

• Building cash reserves for the transition period

• Talking to their banks about short-term flexibility if revenue drops

The Prediction

Some facilities will thrive under PDPM. Others will close within 6 months. The difference? Preparation and understanding your patient mix.

We'll be watching closely and reporting back in next month's edition on what actually happened when the switch flipped.

Bottom line: If you're in Texas and haven't started preparing, you're already behind.