Reimbursement of ICFs/MR program costs based on client resource use

In this article we have described the impetus, research, and recommendations for a new reimbursement system based on client resource use for ICFs/MR in Minnesota. Research to develop a targeted reimbursement strategy has been completed and a proposal for basing program rates on client resource use developed. Residents (N = 913) in a stratified sample of 65 facilities were assessed and staff resource use determined. Results showed that although predictors in the area of personal interaction, integration, and independence, activities of daily living, special treatment/medical complexity, and behavior accounted for a significant amount of variation in resource use, the unaccounted for variation was sufficiently large to support recommending a system that will base program rates on individual client resource use and the historical costs of individual facilities. Key design issues were also discussed.