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SNF Billing Reference

Note: We revised this product with the following content updates:


  • New patient classification system to calculate payment, the Patient Driven Payment Model (PDPM), initiated October 1, 2019

Introduction

Learn these Skilled Nursing Facility (SNF) and Swing Bed topics:

  • Medicare-covered SNF stays
  • SNF payment
  • SNF billing requirements
  • Resources

Medicare-Covered SNF Stays

CMS covers skilled nursing and skilled rehabilitation services when a qualified physician orders the services and the patient needs:

  • The skill of qualified technical or professional health personnel, (registered nurses, licensed practical nurses, physical therapists, occupational therapists, and speech-language pathologists or audiologists)
  • Services directly provided, or under the general supervision of, these skilled nursing or rehabilitation personnel to ensure the safety of the patient and achieve medically desired results

Skilled services must be:

  • Ordered by a physician
  • Delivered by, or under the supervision of, professional or technical personnel
  • Provided for an ongoing condition the patient got from inpatient hospital services or for a new condition that happened during the SNF care for that ongoing condition

Medicare Advantage (MA), 1876 Cost, or Programs of All-Inclusive Care for the Elderly (PACE) Plans typically waive the 3-day hospitalization requirement. MA plans must cover the same number of SNF days Original Medicare covers, but they may cover more SNF days than Original Medicare.

MA plans may offer different benefit periods. Each MA plan’s Evidence of Coverage describes all its Medicare benefits, including SNF coverage. Most MA plans offer SNF coverage through network providers paid according to their contracts. Non-network SNFs should confirm MA coverage with the enrollee’s MA plan. MA plans that cover SNF services furnished by non-network SNFs pay the Original Medicare payment rate, consistent with the MA regulations at 42 CFR Section 422.214.

An Original Medicare enrollee must meet these conditions to qualify for Medicare Part A-covered SNF services:

  • A medically necessary hospital inpatient stay of at least 3 consecutive days (counting the day of admission, but not counting the day of discharge or pre-admission time spent in the emergency room or in outpatient observation). An MA plan, 1876 Cost or PACE Plan may waive the 3-day stay for enrollees.
  • Transferred to a Medicare-certified SNF within 30 days after hospital discharge unless both the following statements are true:
    • Their condition makes it medically inappropriate to begin treatment in a SNF immediately after discharge
    • It is medically predictable at the time of the hospital discharge they need covered care within a pre-determined time period and the care begins within that time
  • They need skilled nursing or rehabilitation services daily which, as a practical matter, can only be provided in a SNF on an inpatient basis.
  • The daily skilled services can only happen in a SNF on an inpatient basis if:
    • They aren’t available on an outpatient basis in the patient’s location
    • When compared to an inpatient setting, transportation to a facility is:
      • An excessive physical hardship
      • Less economical
      • Less efficient or effective
  • The services are reasonable and necessary for treating the patient’s illness or injury and in terms of duration and quantity.

Exhausted Part A Benefit

3-Day Prior Hospitalization

The patient meets the 3-consecutive-day stay requirement by staying 3 consecutive days in one or more hospitals. Only the day of admission, not the day of discharge, counts as a hospital inpatient day. Time spent in observation or in the emergency room before admission, doesn’t count toward the 3-day qualifying inpatient hospital stay.

3-Day Stay Waiver

Certain SNFs that have a relationship with Shared Savings Program (SSP) Accountable Care Organizations (ACOs) may waive the SNF 3-day rule. Occasionally, during a Public Health Emergency, a temporary waiver may be issued as well. Most MA plans waive the 3-day hospitalization requirement.

For each benefit period, Medicare Part A covers up to 20 days of care in full. After that, Medicare Part A covers up to an additional 80 days, with the patient paying coinsurance for each day. After 100 days, the SNF coverage available during that benefit period “exhausts,” and the patient pays all care, except for certain Medicare Part B services. For more information about patient coverage, costs, and care in a SNF, refer to Section 2, pages 97–98 of Your Medicare Benefits.

Benefit Period

Medicare measures SNF coverage in benefit periods (sometimes called “spells of illness”), beginning the day the patient admits to a hospital or SNF as an inpatient. The benefit period ends after the patient discharges from the hospital or has had 60 consecutive days of SNF skilled care. Once the benefit period ends, a new benefit period begins when the patient admits to a hospital or SNF. New benefit periods don’t begin with a change in diagnosis, condition, or calendar year.

SNFs must understand the benefit period concept because sometimes the SNF must submit claims even when they don’t expect payment. This ensures proper benefit period tracking in the Common Working File (CWF) (for more information, refer to the Special Billing Situations section).

The CWF…

…tracks the SNF benefit periods and information about Medicare patients that MAC claims processing systems access ensuring proper claim payments.

Figure 1 describes the relationships among coverage; skilled care; the benefit period; and what type of claim, if any, to submit to Medicare.

Figure 1. Summary of SNF Coverage and Billing

Communicating With Patients

Providers should communicate with patients about:

  • Whether SNF care is right for them – Medicare skilled care helps improve or maintain the patient’s current condition or prevent or slow further deterioration of their condition.
  • SNF coverage requirements – Determine if the patient meets SNF coverage requirements before ordering SNF care. If the SNF care isn’t medically reasonable and necessary, or considered custodial care, Medicare Part A may not cover the SNF care and give them a Fee-for-Service (FFS) Skilled Nursing Facility Advance Beneficiary Notice (SNF ABN), Form CMS-10055. In this case, you must use the SNF ABN to transfer potential financial liability to the patient. Providers must use the SNF ABN CMS revised to replace the five denial letters and the Notice of Exclusions from Medicare Benefits Skilled Nursing Facility (NEMB-SNF), Form CMS-20014. For more information, refer to the FFS SNF ABN webpage or the Medicare Learning Network (MLN) Matters® article Skilled Nursing Facility Advance Beneficiary Notice of Non-Coverage (SNF ABN).

For items or services Medicare Part B pays that Medicare may deny under certain circumstances (if they aren’t medically reasonable and necessary), SNFs should issue the ABN, Form CMS-R-131 to transfer potential financial liability to the patient.

SNF Part B Billing

You must bill some services to Part B. Bill repetitive services monthly or when treatment stops. Bill one-time services when you complete the service.

For more information, refer to Chapter 7 of the Medicare Claims Processing Manual.

SNF Payment

The SNF Prospective Payment System (PPS) pays all SNF Part A inpatient services. Medicare primarily bases Part A payment on the case-mix classification assigned to the patient. Medicare uses the ICD-10-CM codes on the Minimum Data Set (MDS) in Item I0020B and maps these codes to a Patient Driven Payment Model (PDPM) clinical category. PDPM helps determine payment by classifying SNF patients in covered Part A stays. PDPM replaces the Resource Utilization Group (RUG-IV) payment system and improves payments under the PPS by:

  • Improving payment accuracy by focusing on patient characteristics, rather than amount of services provided
  • Reducing administrative provider burdens
  • Improving SNF payments to currently underserved patients without increasing total Medicare payments

For more information, refer to the PDPM Website.

General Payment Tips


  • Medicare won’t pay under the SNF PPS unless you bill a covered day.
  • Medicare only allows ancillary charges for covered days and those included in the PPS rate.

Medicare includes payment for most patient services in a Part A covered SNF stay, including most services given by entities other than the SNF. These services are included in a bundled prospective payment. The SNF must bill these bundled services to the MAC in a CB. If you or your entity delivered services subject to CB and aren’t the SNF, don’t bill Medicare. Bill the SNF.

CB Resources

For more SNF CB information, refer to the SNF Consolidated Billing webpage.

Medicare Part B may pay:

  • Outpatient services provided to patients who aren’t SNF inpatients
  • Services excluded from SNF PPS and SNF CB
  • Certain patient “medical and other health services” provided to patients residing in a SNF whose Part A benefits exhausted or who are not otherwise entitled to payment under Part A
 

SNF Billing Requirements

SNFs bill Medicare Part A using Form CMS-1450 (also called the UB-04) or its electronic equivalent. Send claims monthly, in order, and upon the patient’s:

  • Drop from skilled care
  • Discharge
  • Benefit period exhaustion

When a patient’s benefits exhaust, follow the guidance in Table 3 ensuring the claims processing system accurately tracks the benefit period.

For general billing Form CMS-1450 information, refer to Chapter 25 of the Medicare Claims Processing Manual. Additionally, SNFs must populate the elements in Table 1 for Part A claims (the fields needed for all claims).

Table 1. SNF Billing Requirements
UB-04 Field Report

FL 04

Type of Bill (TOB)

21X for SNF inpatient services.

18X for swing bed services.

FL 06

Statement Covers Period – From/Through

The “From” date must be the admission date or, for a continuing stay bill, the day after the “Through” date on the prior bill.

The “Through” date is the last day of the billing period.

FL 31–FL 34

Occurrence Code/Date

50 with the Assessment Reference Date (ARD) for each assessment period represented on the claim with revenue code 0022 (not required for the default Health Insurance Prospective Payment System [HIPPS] code).

FL 35 & FL 36

Occurrence Span Code – From/Through

70 with the dates of the 3-day qualifying stay.

FL 42

Revenue Code

0022 to indicate you are submitting the claim under the SNF PPS. You can use this revenue code as often as necessary to indicate different rate codes and periods.

FL 44

HCPCS/Rate/HIPPS Code

HIPPS rate code (SNF billing practices related to HIPPS codes remain the same under PDPM).

Must be in the same order the patient got that level of care. Certain HIPPS rate codes need additional rehabilitation therapy ancillary revenue codes. If you don’t include the corresponding codes, the MAC returns the claims for re-submission.

FL 46

Units of Service

The number of covered days for each HIPPS rate code.

FL 47

Total Charges

Zero for 0022 revenue code lines.

FL 67

Principal Diagnosis Code

ICD-10-CM code for the principal diagnosis.

FL 67A–FL 67Q

Other Diagnoses

ICD-10-CM codes for up to eight additional conditions.

For a full explanation about required assessments, refer to Chapter 6, Section 30 of the Medicare Claims Processing Manual.

  • Bill in order. MACs return a continuing stay bill if the prior bill hasn’t processed. If you submitted the prior bill, hold the returned continuing stay bill until you get the Remittance Advice for the prior bill.
  • Generally, the day of discharge or death, or a day when a patient begins a leave of absence (LOA), isn’t counted as a utilization day.
  • If a patient discharges and returns before the following midnight, Medicare doesn’t count it as a discharge.
  • The HIPPS rate code appearing on the claim must match the assessment transmitted and accepted by the state where the facility operates. For more information, refer to the HIPPS Codes webpage.

For help with other billing situations, contact your MAC.

Certain situations need variations from the billing practices discussed above. In some cases, Medicare needs you to submit a claim even though you don’t expect payment (no-pay claim). Additional information in Tables 2–7 helps you decide how to bill various Part A situations. Remember, you must supply adequate supporting documentation for services reported on claims.

Readmission happens when the patient discharges and readmits to the SNF for skilled care within 30 days after the day of discharge. This patient can resume using available SNF benefit days without another qualifying hospital stay. The same is true if the patient remains in the SNF for custodial care after a covered stay then develops a new skilled care need within 30 consecutive days after the first day of non-coverage.

Table 2. Readmission Within 30 Days Situations
If… Then…
You sent a discharge claim before readmission

Submit another bill and report:

  • The current stay admission date
  • Condition code 57
  • Occurrence span code 70 with the qualifying hospital stay dates
The patient readmits before you send a discharge claim

Submit an interim bill and report:

  • The current stay admission date
  • Condition code 57
  • Occurrence span code 70 with the qualifying hospital stay dates
  • Occurrence span code 74 showing the LOA “From” and “Through” dates and the number of noncovered days

When benefits exhaust, continue submitting monthly bills if the patient remains in a Medicare-certified area of the facility. Benefits can exhaust:

  • Fully – The patient had no benefit days available between the “From” and “Through” dates on the claim
  • Partially – The patient had some benefit days available between the “From” and “Through” dates on the claim
Table 3. Benefits Exhaust Situations
If… Then…
The patient moves to a non-Medicare-certified area of the institution

Discharge the patient using the appropriate discharge status code.

If appropriate, the claims processing system applies an A3 occurrence code with the last day the patient had benefits.

Report:

  • Appropriate covered TOB (not 210 or 180)
  • HIPPS AAA00
  • Occurrence span code 70 with qualifying hospital stay dates
  • All covered days and charges
  • Value code 09 with $1.00
  • Appropriate patient status code

Don’t submit Part B services with TOB 22X until the benefits exhaust claim processes. Submit Part B services delivered after skilled care ended, including therapy, on a TOB 22X.

The patient drops to a non-skilled level of care while benefits exhaust and remains in a Medicare-certified area of the institution

Report:

  • Appropriate TOB (SNF: 212, 213; Swing Bed: 182, 183)
  • Occurrence span code 70 with qualifying hospital stay dates
  • Occurrence code 22 with date covered SNF care ended
  • Value code 09 with $1.00
  • Patient status code 30

Submit Part B services delivered after skilled care ended, including therapy, on a TOB 22X.

The patient drops to a non-skilled level of care while benefits exhaust and moves to a non-Medicare-certified area of the institution or otherwise discharges

Report:

  • TOB 211 or 214 for SNFs and 181 or 184 for swing beds
  • Value code 09 with $1.00
  • Appropriate patient status code (other than 30)

Submit Part B services delivered after skilled care ended, including therapy, on a TOB 23X.

For no payment billing, the patient drops to a non-skilled level of care and remains in a Medicare-certified area of the institution.

Table 4. No Payment Billing Situations
If… Then…
If you need a denial notice so another insurer will pay, send the initial no payment claim with the “From” date as the date SNF care ended. Then, continue to send claims as often as monthly.

Report:

  • All days and charges as non-covered, beginning the day following the day SNF care ended
  • Condition code 21
  • Appropriate patient status code
  • TOB 210 for SNFs or 180 for swing beds
  • HIPPS AAA00

Submit Part B services delivered after skilled care ended, including therapy, on a TOB 22X.

Send only one final discharge claim if no denial notice is needed. The claim may span both the SNF and Medicare FY end dates.

Report:

  • “From” date as the day SNF care ended
  • “Through” date as the date of discharge
  • All days and charges as non-covered, beginning the day following the day SNF care ended
  • Condition code 21
  • Appropriate patient status code (other than 30)
  • TOB 210 for SNFs or 180 for swing beds
  • HIPPS AAA00

Submit Part B services delivered after skilled care ends, including therapy, on a TOB 22X.

Provider-initiated discharges for coverage reasons associated with SNF and inpatient swing bed claims need an expedited determination notice. A Medicare patient or a representative can appeal provider service terminations to a Quality Improvement Organization (QIO) through the Expedited Determinations process.

QIOs must inform the patient of their right to an expedited reconsideration by the Qualified Independent Contractor (QIC) and how to request a timely expedited reconsideration. You must report the outcomes of expedited determinations on the claim.

Table 5. Expedited Review Results Situations
If… Then…
QIO/QIC upholds the discharge decision

Report:

  • A discharge for the billing period that precedes the determination
  • Condition code C4
  • If the patient is liable for care days, report:
    • Occurrence span code 76 with the days the patient incurred liability
    • Zero charges for the patient-liable days
    • Modifier –TS for HCPCS codes for those days
The QIO/QIC authorizes continued coverage with no specific end date

Report:

  • A continuing claim for the current billing or certification period
  • Condition code C7
The QIO/QIC authorizes continued coverage only for a limited period, and the time extends beyond the end of the normal billing or certification period

Report:

  • A continuing claim for the current billing or certification period
  • Condition code C3
  • Occurrence span code M0 with the beginning date of QIO/QIC-approved coverage and the claim “Through” date
The QIO/QIC authorizes continued coverage only for a limited period, and the time doesn’t extend beyond the end of the normal billing or certification period

Report:

  • A discharge claim
  • Condition code C3
  • Occurrence span code M0 with the beginning and end dates of QIO/QIC-approved coverage
The provider is liable due to failure to give timely information to the QIO/QIC or deliver valid notice to the patient Report services as non-covered with modifier –GZ

The patient doesn’t meet Medicare SNF coverage requirements.

Table 6. Non-Covered Days Situations
If… Then…
The patient is liable

Report occurrence span code 76

Submit the claim as covered if care is skilled

The SNF is liable

Report occurrence span code 77

Submit the claim as covered if care is skilled

Table 7. Other SNF Billing Situations
Situation If… Then…
No Qualifying Hospital Stay The patient admits needing skilled care but doesn’t have a qualifying hospital stay. This includes persons initially admitted as skilled, following a qualifying hospital stay, dropped to a non-skilled level of care for more than 30 days. This ended their connection to the original qualifying hospital stay, but the patient became skilled again without a new qualifying hospital stay. Bill normally, but don’t report occurrence span code 70
Same Day Transfer The patient admits to the SNF and is expected to remain overnight but transfers before the following midnight to a Medicare-participating facility

Report:

  • The same admission, “From” and “Through” dates
  • Zero (“0”) covered days
  • Condition code 40
LOA The patient leaves the SNF but isn’t admitted as an inpatient to any other facility

Report:

  • Revenue code 018X
  • Number of LOA days as units
  • Zero charges
  • Occurrence span code 74 showing “From” and “Through” dates for the LOA and the number of non-covered days
Forced Discharge The patient leaves the SNF and admits as an inpatient to another facility Bill as a discharge. If the patient readmits to the SNF within 30 days, follow the instructions for “Readmission Within 30 Days” in Table 2.
Non-Skilled Discharge The patient drops to a non-skilled level of care and moves to a non-Medicare-certified area of the institution Discharge the patient on a final discharge claim. Submit services given after discharge on a TOB 23X.
Demand Billing The SNF believes covered skilled care is no longer medically necessary, and the patient disagrees

Report:

  • Condition code 20
  • Occurrence code 22 with the date SNF care ended or occurrence code 21 with the date you got the utilization review notice
Medicare Advantage (MA) Plan Information-Only Billing The patient is an MA Plan enrollee

Submit information-only claims to Medicare so the Common Working File (CWF) can track the benefit period.

Report:

  • Appropriate HIPPS code based on assessment or HIPPS AAA00 if no assessment happened
  • Room and board charges
  • Condition code 04
Disenroll from MA Plan and convert to FFS while SNF inpatient The patient meets the level of care criteria through the effective disenrollment date

Medicare waives the requirement for a qualifying hospital stay and the patient is eligible for the number of days remaining out of the 100-day benefit period for that stay minus the days Original Medicare would have covered while the patient was an MA Plan enrollee.

Report condition code 58.

Disenroll from MA Plan after SNF discharge and converts to FFS The patient readmits under 30-day rule

The patient must meet all FFS requirements, including qualifying 3-day hospital stay; providers may charge patients SNF coinsurance.

Report condition code 58.

Disenroll from MA Plan The patient disenrolls from the MA Plan before SNF admission

The patient must meet all requirements for FFS, including qualifying 3-day hospital stay.

Report condition code 58.

Interrupted Stay The patient is discharged from a Part A-covered stay and subsequently resumes SNF care in the same SNF for a Medicare Part A-covered stay during a 3-day period, starting with the calendar day of Part A discharge and including the 2 immediately following calendar days, which is referred to as an interruption window. An OBRA Discharge MDS assessment is required. An Entry Tracking record is required on re-entry, but no 5-Day MDS assessment is required.

Key Takeaways

  • The SNF benefit covers 100 days of care per episode of illness with an additional 60-day lifetime reserve. After 100 days, the SNF coverage during that benefit period “exhausts.” The next benefit period begins after patient hospital or SNF discharge for 60 consecutive days.
  • Medicare pays all inpatient SNF services primarily based on the PDPM case-mix classification assigned to the patient.
  • SNFs use a consolidated bill when filing claims with a MAC including most services from entities other than the SNF. Entities delivering patient services in a Medicare-covered Part A SNF stay must bill the SNF for their services, not the MAC.
  • There are many different issues that impact billing SNF services, but generally, SNFs bill Medicare Part A covered services monthly, in order, or when the patient drops from skilled care, discharges, or their benefits exhaust.

Resources




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