Medical Review Trends in Skilled Nursing Facilities Today

Posted: Dec 18, 2017

Why the Claims, CMS?

As anyone in the Medical Review sector of skilled nursing and long-term care knows, the Centers for Medicare and Medicaid Services (CMS) is continuously conducting some type of claim reviews throughout the United States. Therefore, it is imperative for medical review professionals to stay informed regarding the type of reviews that are active. Since 2010, the skilled nursing facility (SNF) industry has been subjected to a number of diverse trends regarding medical review. The medical review of SNF claims was initiated so that CMS could identify Medicare overpayments and fraud.

Currently trending in the SNF sector of medical review is the SNF RUG Review. In a number of states, CMS has instructed their Medicare Appeal Contractors to review pre-pay Medicare Part A claims that are billed at a RUG level of RU (Ultra-High Rehabilitation). They want to ensure that the skilled therapy and nursing claims meet Medicare’s coding, coverage, and medical necessity requirements before paying for the billed services.

The SNF RUG Review is a Medicare Part A pre-pay review for every claim billed in a skilled nursing facility with RUG level billed at an RU. As this is a pre-pay review, the facility is not paid for services until the Medicare Appeal Contractor (MAC) requests, receives, and reviews the documentation for the claims under review and finds the services meet CMS’ requirements. Additionally, the MACs are not only reviewing one month of the beneficiaries' Medicare episode of care but are reviewing the entire Medicare Part A episode of care. If a claim is denied as a result of the audit, the SNF can appeal the initial determination.

Managed Care RUG Reviews

Many Managed Care companies that have Medicare replacement plans are also conducting RUG reviews. Currently, the trend for Managed Care reviews are post-pay Managed Care RUG reviews. The majority of these reviews are directed at RUGs billed at the RU level as well. Like the Medicare Part A reviews, the Managed Care RUG reviews are also for the entire post qualifying hospital stay. The difference between these audits is the managed care companies have already paid for the services they are reviewing. If the audit findings determine there was an overpayment, the SNF is requested to repay the amount that was not medically necessary. However, like the Medicare Care Part A decisions rendered by the MAC, the SNF has the opportunity to file an appeal of the initial determination rendered by the managed care company.

In order to receive payment for these pre-pay and post-pay claims, it is imperative to ensure the documentation for each claim conveys medical necessity and reflects that skilled services are being provided by licensed professionals. If these two requirements are met, facilities should not have any issues with the claims being paid as billed.

Bethany Nichols, PTA

Director of Medical Review, Century Rehabilitation

Century Rehab offers the following Medical Review & Appeal services:

  • Training on how to complete an appeal
  • Provide all necessary forms and sample letters
  • Auditing of current claims to identify potential deficits in documentation, coding, clinical compliance, and regulatory compliance
  • Managing and processing all aspects of the ADR and medical appeals process

To learn more, please email Bethany Nichols, Director of Medical Review, at