Medicare & Medicaid Nursing Home Update

June 9, 2004

Skilled Nursing Facility ("SNF") Consolidated Billing: Services furnished under an "arrangement" with an outside entity

CMS recently issued a reminder to SNFs and suppliers serving SNF residents that the Federal Social Security Act requires that SNFs must furnish any Part A or Part B service that is subject to SNF consolidated billing either directly or obtain the service from an outside entity under an "arrangement". An "arrangement" constitutes a written agreement to reimburse the outside supplier/vendor for services subject to consolidated billing. Medicare has not prescribed the terms of the agreement except that the supplier/vendor is required to be paid for its services. Where services are furnished by an outside supplier and there is no agreement in place, the SNF may be deemed to have failed to furnish the services under an "arrangement". The SNF is at risk of being found in violation of the terms of its Provider Agreement. In addition, the inappropriate submission of a Part B bill could result in the imposition of civil monetary penalties.

CMS pointed that problem of a supplier/vendor billing Medicare directly for services furnished to a resident subject to consolidated billing has generally arisen when: (i) residents leave the facility temporarily and obtain services off-site from a provider that does not have an arrangement with the SNF or (ii) a SNF uses the services of an outside supplier but fails to inform the supplier that the resident receiving the service is subject to consolidated billing. To avoid these problems, CMS suggested that (i) the SNF should provide to the residents/designated representatives at the time of admission, a list of providers with whom the Facility has an arrangement and (ii) the SNF should provide to the supplier timely and accurate information about the resident’s Medicare covered SNF stay.

CMS Website: Sharing Innovation in Quality (SIQ)

CMS has developed a new website which serves as a databank of nationally accepted clinical/professional standards and guidelines on long term care practices. Facilities should use this site to assess whether its practices are in compliance with long term care requirements. The site will

also be used by surveyors to make a similar evaluation of the facility’s practices. The site is available at www.cms.hhs.gov/medicaid/survey-cert/siqhome.asp.

SNF Billing

Effective July 1, 2004, the following healthcare coding changes have occurred: HCPCS coding G0104 is now payable to a SNF; HCPCS code G0239 has been added to the therapy list in place of HCPCS code G0295 (Transmittal No. 182 replaces transmittal no. 177) and twenty new "K" codes have been established for wheelchair cushions while several previous codes for billing for wheelchairs will now be invalid (Transmittal No. 179).

If you have any questions or need additional information, please feel free to call the attorneys in our Health Law department at (516) 328-2300.