The Enigma of Medical Necessity (Part 1 of 2)

To be eligible for Medicaid nursing home benefits in Texas, an elderly individual must require a level of care that necessitates placement in a skilled nursing long term care facility. This need for care is generally referred to as Medical Necessity. This determination is not something that the client, the client’s family or an elder law attorney can control or even significantly influence.

Medical necessity is determined by a State contractor, currently Texas Medicaid & Healthcare Partnership (TMHP), based on an assessment made by the nursing home to which the applicant has been admitted. The standardized assessment is know as the Minimum Data Set (MDS) and is described as a “collection of demographic and clinical information that describes a person’s overall condition.” Texas currently uses MDS 3.0, as promulgated by the Centers for Medicare & Medicaid Services (CMS).

The MDS 3.0, prepared for CMS and published as an appendix to the 2008 Rand Corporation Report on a revised nursing home assessment tool, consists of a 33-page assessment form that prompts inquiry into a variety of mental, physical, emotional, medical and functional aspects of the patient’s daily existence. Answers to the questions on the MDS can be gleaned from the patient directly, or from facility staff, patient family or close friends, depending on the circumstances. By definition, most of the questions on the MDS cannot be completed in less than 5 days of observation and information concerning the patient’s condition and activity. In other words, it is not a momentary interview of the client at a specific time, but a more comprehensive evaluation of the patient over the course of a week.  If the evaluator is treating the MDS as a one-time interview of the patient, it is being done wrong, and the resulting data cannot be properly used to evaluate a patient’s medical necessity.

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