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Survey & Certification - Enforcement

The CMS Regional Office (RO) and State survey agency (SA) follow the procedures in the State Operations Manual (SOM), Chapter 3, if an adverse action is likely to be initiated against Medicare participating providers and suppliers.  Because many Medicare providers and suppliers also participate in the Medicaid program and Federal procedures must also be followed when surveying and certifying providers that only participate in the Medicaid program, these procedures generally apply to both programs.  Exceptions for Medicaid are noted.

Cause for Termination - CMS may terminate an agreement with a provider of services if it is determined that the provider: 

  • Is not complying substantially with the terms of the agreement, the provisions of title XVIII of the Social Security Act, or regulations promulgated thereunder; 
  • Has failed to supply information necessary to determine whether payments are or were due and the amounts of such payments;
  • Refuses to permit examination of fiscal and other records (including medical records) necessary for the verification of information furnished as a basis for claiming payment under the Medicare program; or
  • Refuses to permit photocopying of any records or other information necessary to determine or verify compliance with participation requirements.

Compliance with Requirements - The Medicare Conditions of Participation (CoPs), Requirements for Skilled Nursing Facilities (SNFs) and Nursing Facilities (NFs), and Conditions for Coverage (CfCs) are sets of requirements for acceptable quality in the operation of health care entities.  There is a set of Conditions, or Requirements for SNFs and NFs, for each type of provider or supplier subject to certification.  In addition to each Condition, or Requirement for SNFs and NFs, there is a group of related quality standards, with the Condition or Requirement expressed in a summary lead sentence or paragraph characterizing the quality or result of operations to which all the subsidiary standards are directed. 

The State Agency, by a survey conducted by qualified health professionals, determines whether and how each standard is met.  While an institution may fail to comply with one or more of the subsidiary standards during any given survey, it cannot participate in Medicare unless it meets each and every Condition or attains substantial compliance with requirements for SNFs and NFs.

Many Condition or Requirement summaries are identical to statements of the statute.  The essence of what the SA certifies to CMS is a finding of whether an institution meets each of the CoPs or substantially meets each requirement for SNFs and NFs applicable to it, and whether each supplier of services meets each CfC applicable to it.

Statement of Deficiencies - The State Agency prepares its certification for the CMS Regional Office, sends the institution a "Statement of Deficiencies," Form CMS-2567.  The institution is given 10 calendar days in which to respond with a Plan of Correction (PoC) for each cited deficiency, and enters this response on the form containing the statement of deficiencies.

If the institution has not come into compliance with all Conditions or Requirements for SNFs and NFs within the time period accepted as reasonable, the SA certifies noncompliance notwithstanding a PoC.

The State Agency's finding constitutes a final determination (except in the case of a State-operated Medicaid-only NF or a NF subject to a validation survey or a review by CMS when CMS' decision is binding), when a Medicaid-only facility is noncompliant.  The State Medicaid Agency must undertake either an action to terminate the non-complying facility's Medicaid participation or, if a NF, apply one or more of the remedies specified in §1919 of the Social Security Act, or it may do both.

Note additional information for Intermediate Care Facilities for the Mentally Retarded SOM (Sections 3005G – 3007, and Sections 3040 – 3042) and Psychiatric Hospitals (Section 3012.1) in Chapter 3 of the SOM.

See also Chapter 7 of the State Operations Manual for specifics pertaining to SNFs and NFs.