‘Respiratory is One of the Biggest Denials’: Inside the New MDS and Avoiding Costly Compliance Errors at Nursing Homes

In the latest Minimum Data Set (MDS), effective on Oct. 1, providers will need to pay close attention to definition changes, including the term used to define gender, as well as to the sections on Falls and Therapy Services, which have become known as major sources of compliance errors and revenue loss.

Sector experts advise being extra diligent in monitoring and documenting new compliance related to section J, or Falls, and section O, or Therapy Services, according to Alicia Cantinieri, managing director of clinical reimbursement and regulatory compliance at Zimmet Healthcare Services Group.

Cantinieri, who specializes in the Resident Assessment Instrument (RAI) and the MDS process, led a webinar Thursday in which she outlined new definitions, updated guidelines, and operational implications for nursing home providers for fiscal year 2026, especially as these relate to the upcoming MDS changes.

Section J’s redefinition of a “fall” now includes those caused by “overwhelming external force,” which is a reversal of prior guidance, for example, she said. This shift could significantly affect fall-related Quality Measures (QMs) and requires facilities to retrain staff on fall incident reporting, Cantinieri said.

There are also some very fundamental changes to definitions in the new MDS. And since certain fields are never allowed to be left incomplete such as the resident’s name, assessment type, sex, and any diagnosis codes, “dashing” these fields violates reporting requirements and could result in rejection, she cautioned.

Of particular note on this front is the new MDS’ removal of the category of “Gender.” It is now replaced with “Sex,” requiring coding based on Social Security records – not gender identity. Despite discomfort that the question may raise with staff, Cantinieri advised clear and consistent explanations when gathering this sensitive data, noting, however, that it is simply for data collection only at this point, and not reimbursement.

“We want to avoid dashes, especially for our Medicare Part A residents, because [this] impacts our data reporting threshold,” she noted.

For effective discharge planning, while certain updates no longer require detailed documentation, it’s good practice to do so anyway, she said.

The removal of Section R, or Health-Related Social Needs, as of May 2025 is no longer a part of the MDS, but Cantinieri strongly recommended continuing to ask questions pertaining to this area, especially around food insecurity, housing, and transportation, to prevent rehospitalizations.

Another example of no longer required data are details on post-discharge transportation. This item is now within Section A, and its reworded format – a simple ‘yes’ or ‘no’ response about transportation barriers in the past 12 months – can be problematic because it oversimplifies, she said. And so, providers should ask residents details on transportation for effective discharge, Cantinieri advised.

On interview-based sections for the depression screening, Cantinieri said the Patient Health Questionnaire, or PHQ-2 to 9, deserves special attention, and pointed out the need to find the right staff member to conduct the interviews. Her practical strategies to avoid incomplete data in this area also includes use of cue cards, disentangling and pulling apart questions, in order to accurately collect data. After all, poorly conducted interviews can lead to inaccurate data, hurting both reimbursement and care planning, she said.

“You want to find your facility all star, who’s the best person who’s able to use all the interviewing techniques, make it a conversation,” Cantinieri said.

There’s no requirement for clinicians or certain disciplines to conduct the interview, she stressed.

“Facilities have been successful in having the social worker do it, in some cases, the recreation staff, as long as they’re trained. Some facilities have the nurses do it. Some facilities have one of the therapists,” she said.

And last but not least, Cantinieri also emphasized documentation accuracy in Section I diagnoses, noting that even resolved conditions such as pneumonia can be coded as “active” if clearly tied to ongoing care needs to improve reimbursement. However, missing documentation on that front often undermines reimbursement during audits.

Top denials

Respiratory therapy remains one of the most common areas for denials and audit findings. In order to code respiratory therapy, there must be a physician or non-physician practitioner (NPP) order that includes frequency, duration, and scope of the therapy, but facilities can overlook this. Moreover, it is required that documentation must be clear, staff credentials must be verifiable, and periodic evaluations of whether the therapy is effective must be conducted, she said.

“Respiratory is one of the biggest denials that we’re seeing across all of the Medicare contractors and with state CMI because something is missing that’s required to code respiratory,” Cantinieri said.

Only “medically necessary therapies” are allowed to be provided after the resident is admitted, she noted. “They have to be documented in the record, and they have to be in the care plan and periodically evaluated,” she added.

Cantinieri recounted one audit example that showed a denial that cost the facility over $5,000 due to lack of proper documentation and credentialing, highlighting how missing just one required component invalidated the entire respiratory therapy coding and associated reimbursement.

Weight loss and gain items in the MDS can also be a source of common coding mistakes, she said.

And for pressure ulcers, the Centers for Medicare and Medicaid Services (CMS) has provided clarification on “unstageable” wounds. If a resident is admitted with a deep tissue injury that later evolves but remains unstageable, whereby the base of the wound cannot be seen and is covered with slough, it will still count as being present on admission. This specific scenario was added to the RAI manual to address previously ambiguous situations, she noted.

Finally, long-stay antipsychotic use remains a big area of scrutiny, Cantinieri said, noting CMS’ June memo pertaining to the use of these medications. This change will begin affecting public reporting starting with the October refresh, and it signals that CMS will continue to expand oversight of psychotropic drug use alongside all the other areas of MDS data collection, she said.

Falls coding

Accurate coding of falls on the MDS, remains imperative and Cantinieri said that facilities need to be aware that even an unintentional change in a resident’s position that resulted in the resident coming to rest on a lower surface – such as the floor, bed, chair, or mat – is now considered a fall. The importance of coding these incidents correctly directly affects the facility’s quality measures, including the “Prevalence of Falls” QM, which is subject to survey scrutiny. If a fall is identified during a survey but was not coded on the MDS, it could result in a citation for inaccurate assessments, Cantinieri cautioned. The updated fall definitions and the inclusion of additional injury types in the criteria may make it appear as though more residents are falling, even though the increase is due to definitional changes rather than actual incidents.

A new report from the Office of Inspector General (OIG) stated that 43% of falls with major injury and hospitalization among Medicare residents were not reported on the MDS. The OIG report’s findings mean facilities need to do a much better job of ensuring that their MDS data reflects actual clinical events, particularly for falls and injuries that result in hospital transfers. If a major injury is identified during hospitalization and was not known at the time of the MDS discharge assessment, the facility isn’t off the hook and is required to correct the assessment retroactively to reflect that information, said Cantinieri.