Reviewing Inpatient Bills for Services After Suspension, Termination, Expiration, or Cancellation of Provider Agreement, or After a SNF is Denied Payment for New Admissions

A SNF may be denied payment for new admissions, but not readmissions, as an option to termination of its provider agreement for noncompliance with one or more requirements of participation. The SNF may only be reimbursed for covered services furnished on or after the effective date of denial of payments if such services were furnished to beneficiaries who were admitted to the SNF before the effective date of termination or expiration.

Effective date of denial of payment – 9-30

Beneficiary admitted before 9-30 – pay for covered Part A or B services

Beneficiary admitted on or after 9-30 – deny payment under Part A or B

NOTE: An inpatient who goes on leave from the SNF before or after the effective date of denial of payments for new admissions is not considered a new admission when returning from leave.

The contractor is notified of SNF payment denials through the Form CMS-2007. It must install appropriate edits or other safeguards to prevent incorrect payments to the provider.

The contractor obtains a list of Medicare inpatients when a SNF or hospital agreement is terminated, or after a SNF is denied payment for new admissions to assure that nonpayment spell of illness bills are filed.