01-088 SNF PDPM Findings of Medical Review

Noridian Healthcare Solutions, LLC, (Noridian), as the Supplemental Medical Review Contractor (SMRC) for the Centers for Medicare and Medicaid Services (CMS), has conducted post-payment review of claims for Medicare Part A Skilled Nursing Facility (SNF) services billed on dates of service from January 1, 2020 through December 31, 2020. Below are the review results:

Project ID Project Title Error Rate for Reviewed Claims No Response to ADR Denials
01-088 SNF PDPM 18% 4%


In July 2018, the Patient Driven Payment Model (PDPM) for SNF billing was finalized by CMS. This new case-mix classification model was created to classify SNF patients in a covered Part A stay. Under the PDPM, the patient’s characteristics are used to predict therapy costs under the SNF Prospective Payment System (PPS) beginning October 1, 2019.

The 2021 Medicare Fee-for-Service Supplemental Improper Payment Data reported a projected improper payment estimated at $2.7 billion dollars for inpatient SNF services. Further data analysis done by CMS and the SMRC had identified a possible vulnerability in the maximization of payments by a drop in therapy utilization and/or the manipulation of other combinations of care.

Reason for Review

The SMRC was tasked with performing claim review on a sample of Medicare Part A SNF claims with dates of service (DOS) January 1, 2020, through December 31, 2020. The SMRC conducted medical record reviews in accordance with applicable statutory, regulatory, and sub-regulatory guidance and in keeping with the waivers/flexibilities/statutory, regulatory, and sub-regulatory guidance.

Common Reasons for Denial

  • Missing Certifications or Recertifications
    • Refer to Internet-Only Manual, Publication (Pub) 100-02, Medicare Benefit Policy Manual, Chapter 8, Section 40, Pub 100-01, Medicare General Information, Eligibility and Entitlement Manual, Chapter 4, Section 40. The documentation submitted did not include the required certifications or recertifications for the SNF stay.
  • Incomplete and/or Insufficient Information
    • Refer to Internet-Only Manual, Pub 100-08, Medicare Program Integrity Manual, Chapter 3, Section C, Social Security Act 1833(e), 42 Code of Federal Regulations (CFR) 424.5(a)(6). The documentation submitted was incomplete/insufficient information. The submitted documentation did not include therapy evaluations, documentation did not meet requirements for certification or recertifications, incomplete or insufficient documentation to support MDS entries, or when the MDS was not signed timely for claims with DOS prior to March 1, 2020.


Social Security Act (SSA), Title XVIII

  • § 1812(a)(2)(A), (b)(2) Scope of Benefits
  • § 1813(3) Deductibles and Coinsurance
  • § 1814(2)(B) Conditions of Payment and Limitations on Payment for Services
  • § 1815(a) Payment to Providers of Services
  • § 1819(a)-(f) Requirements for, and Assuring Quality of Care In, Skilled Nursing Facilities
  • § 1833(e) Payment of Benefits
  • § 1861(a) (1-2), (h)-(j) Definitions of Services, Institutions, Etc
  • § 1862(a)(1)(A) Exclusion from Coverage and Medicare as a Secondary Payer
  • § 1879(a) Limitation on Liability of Beneficiary where Medicare Claims are Disallowed
  • § 1888(e) Prospective Payment
  • § 1888(g) Skilled Nursing Facility Readmission Measure
  • § 1888(h) Skilled Nursing Facility Value-Based Purchasing Program
  • § 1893(b) Medicare Integrity Program
  • § 1899(f) Waiver Authority

Balanced Budget Act of 1997 (BBA), Public Law 105-33

  • § 4432(b) Prospective Payment for Skilled Nursing Facility Services

42 Code of Federal Regulations (CFR)

  • § 409.20-409.27 Posthospital SNF Care
  • § 409.30-409.36 Requirements for Coverage of Posthospital SNF Care
  • § 411.15(k)(1) Particular Services Excluded from Coverage
  • § 413.1 Introduction and General Rules
  • § 413.330-413.360 Prospective Payment for Skilled Nursing Facilities
  • § 424.5(a)(6) Sufficient Information
  • § 424.20 Requirements for Posthospital SNF Care
  • § 425.612 Waivers of Payment Rules or Other Medicare Requirements
  • § 483 Requirements for States and Long-Term Care Facilities. Subpart B. Requirements for Long Term Care Facilities; and Subpart F. § 483.315. Specification of Resident Assessment Instrument

Internet Only Manual (IOM), Medicare General Information, Eligibility and Entitlement Manual, Publication 100-01

  • Chapter (Ch.) 1 General Overview § 10.1 Hospital Insurance (Part A) for Inpatient Hospital, Hospice, Home Health and SNF Services – A Brief Description; and § 20 Administration of the Medicare Program
  • Ch. 4 § 40 Certification and Recertification by Physicians for Extended Care Services

IOM, Medicare Benefit Policy Manual (MBPM), Publication (Pub.) 100-02

  • Ch. 8 Coverage of Extended Care (SNF) Services Under Hospital Insurance
  • Ch. 15 § 250 Medical and Other Health Services Furnished to Inpatients of Hospitals and Skilled Nursing Facilities
  • Ch. 16 General Exclusion from Coverage § 10 General Exclusion from Coverage; § 20. Services not Reasonable and Necessary; and § 110 Custodial Care

IOM, Medicare Claims Processing Manual (MCPM), Pub. 100-04

  • Ch. 1 General Billing Requirements
  • Ch. 6 SNF Inpatient Part A Billing and SNF Consolidated Billing
  • Ch. 30 § 40 and 50 Advance Beneficiary Notice of Non-coverage (ABN)
  • Ch. 30 Financial Liability Protections. § 130.2. Prior Hospitalization and Transfer Requirements for SNF Coverage as Related to Limitation on Liability; § 130.3. Application of Limitation on Liability to SNF and Hospital Claims for services Furnished in Noncertified or Inappropriately Certified Beds

IOM, Medicare Program Integrity Manual (MPIM), Pub. 100-08

  • Ch. 3 Verifying Potential Errors and Taking Corrective Actions
  • Ch. 3 § Time Frames for Submission
  • Ch. 3 § Additional Documentation Request Required and Optional Elements
  • Ch. 3 § No Response or Insufficient Response to Additional Documentation Requests
  • Ch. 3 § Documents on Which to Base a Determination
  • Ch. 3 § Signature Requirements
  • Ch. 3 § Reasonable and Necessary Criteria
  • Ch. 3 § Limitation of Liability Determinations
  • Ch. 3 § Coding Determinations
  • Ch. 3 § Denial Types
  • Ch. 5 § 5.9 Documentation in the Patient’s Medical Record
  • Ch. 5 § 5.11 Evidence of Medical Necessity

Local Coverage Determination (LCD)

  • L35008 Non-Covered Services. Effective October 1, 2015 (Retired June 30, 2020)
  • L36219 Non-Covered Services. Effective October 1, 2015 (Retired June 30, 2020)

Local Coverage Article (LCA)

  • LCA A55503 Skilled Therapy Services in the SNF PPS Setting. Effective October 23, 2015
  • LCA A55505 Skilled Therapy Services in the SNF PPS Setting. Effective October 23, 2015


Last Updated Jan 25, 2024