Noridian Healthcare Solutions, LLC (Noridian), as the Supplemental Medical Review Contractor (SMRC) for the Centers for Medicare & Medicaid Services (CMS), is conducting post-payment review of claims for Medicare Part A billed with dates of service from April 1, 2025, through June 30, 2026. This notification includes the reasons for the review, documentation that will be requested in the Additional Documentation Request (ADR) letter, and resources providers/suppliers may wish to consult when submitting claims.

Background

Medicare covers medically necessary services furnished in a Long-Term Care Hospital (LTCH), which is a hospital certified to provide extended inpatient acute care services for medically complex conditions requiring a prolonged hospital stay. On average, LTCH stays are more than 25 days. The services are provided for beneficiaries with medical needs that cannot be safely or effectively managed in a less intensive setting. Beneficiaries are commonly transferred to LTCHs from acute care hospitals, including intensive care or critical care units.

Services for LTCH include daily physician management, continuous nursing care, respiratory therapy, ventilator management, complex medication administration, nutritional support, diagnostic testing, wound care, and discharge planning.

Beneficiaries admitted to LTCH must require ongoing inpatient hospital level services that are reasonable and necessary for the diagnosis or treatment of illness or injury. The documentation must support the need for prolonged long-term care hospitalization, including the severity of the beneficiary’s condition, the intensity of services required, and the need for close medical supervision and multidisciplinary treatment. Physician documentation must substantiate the medical necessity of the admission and continued stay, support all reported diagnoses, procedures, and demonstrate that the services provided could not be done safely or effectively at a lower level of care.

Reimbursement for LTCH inpatient stays is described in 42 Code of Federal Regulations (CFR) §§412.505 and 412.513. The payment is based on the Long-Term Care Hospital Prospective Payment System (LTCH PPS), which assigns cases to Medicare Severity Long-Term Care Diagnosis-Related Groups (MS-LTC-DRGs) and calculates payment according to the assigned group and applicable payment adjustments. The LTCH PPS also provides high-cost outlier (HCO) payments for exceptionally costly cases, covering 80 percent of costs above the annual fixed-loss threshold. Claims receiving a high-cost outlier (HCO) payment are assigned value code 17 during claims processing to indicate the additional payment amount.

In April 2026, Noridian Healthcare Solutions, LLC (Noridian), as the current Supplemental Medical Review Contractor (SMRC), completed data analysis on LTCH outlier payments in the northeastern (NE) United States and identified the top 10 hospitals that received outlier payments.

Reason for Review

Centers for Medicare and Medicaid Services (CMS) directed Noridian to perform data analysis and medical record review on July 20, 2026. The SMRC will perform data analysis and medical record review of supporting documentation to determine if the LTCH services DRG code is billed appropriately and corresponds to the documentation submitted.

Claim Sample Detail

Access related project details below.

• Documentation Requirements
• References

Documentation Requirements

Below is a list of specific documentation requirements that will be included in each ADR to obtain the necessary documentation to perform the review.

Providers/suppliers are requested to submit each of the Documentation Requirements outlined below, if and as applicable to the claim on review.

1. Itemized statement of all billed charges (including charge code descriptions and precise revenue code for each charge billed)
2. Acute care transfer records
3. Physician/Non Physician (NPP) Admission Orders
4. Description of the onset of illness and the circumstances leading to admission
5. Initial admission assessment or reassessment
6. History and Physical reports (include medical history and current list of medications)
7. Progress notes for the services on review
8. Physician consultations for the services on review
9. Nursing Documentation (i.e. Nursing notes and admission assessment-Lines; Medication & IV administration records; nursing treatment sheets such as: Skin care/wound care treatment sheets. Respiratory treatments and oxygen therapy records)
10. Documentation to support the DRG/diagnosis billed
11. All records that justify and support the level of care received and continued medical need for the LTCH services
12. Respiratory treatments and oxygen therapy records
13. Physical Therapy (PT)/Occupational Therapy (OT)/Speech Language Pathology (SLP)-Initial evaluation/re-evaluation, plans of care, progress reports, treatment encounter notes, therapy minute logs, and discharge summary
14. Diagnostic tests, radiological reports, lab results, pathology reports, and other pertinent test results and interpretations
15. X-ray findings and/or bone cultures
16. Discharge summary if applicable
17. Hospital-issued notice of non-coverage (HINN) on file
18. Signature log or signature attestation for any missing or illegible signatures within the medical record (all personnel providing services)
19. Any other supporting/pertinent documentation
20. If medical record documentation is submitted via esMD, beneficiary identification, date of service, and provider of the service should be clearly identified on each page of the submitted documentation
21. Please Note: The provider is responsible for obtaining all documentation from the ordering/referring provider to ensure medical necessity criteria have been met.

References

Social Security Act (SSA), Title XI

• §1135 Authority to Waive Requirements During National Emergencies

SSA, Title XVIII

• §1815(a) Payment to Providers of Services
• §1833(e) Payment of Benefits
• §1861 Definitions of Services, Institutions, etc.
• §1862(a)(1)(A) Exclusion from Coverage and Medicare as a Secondary Payer
• §1886(d)(1)(B)(iv) LTCH definition (average inpatient length of stay greater than 25 days)
• §1886(m) Long-Term Care Hospital Prospective Payment System
• §1893(b) Medicare Integrity Program

42 Code of Federal Regulations (CFR)

• §411.15(k)(1) Basic conditions
• §424.5(a)(6) Particular Services Excluded from Coverage
• §412.6 DRG Classification and Weighting Factors
• §412 Subpart O Prospective Payment System for Long-Term Care Hospitals

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

• Chapter (Ch.) 1, Inpatient Hospital Services Covered Under Part A
• Ch. 3, Duration of Covered Inpatient Services
• Ch. 5, Lifetime Reserve Days

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

• Ch. 3, §10 General Inpatient Requirements
• Ch. 3, §20 Payment Under Prospective Payment System (PPS) Diagnosis Related Groups (DRGs)
• Ch. 3, §150 Long-Term Care Hospitals (LTCHs) PPS

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

• Ch. 3, §3.3.2.1 Documents on which to Base a Determination
• Ch. 3, §3.3.2.4 Signature Requirements
• Ch. 3, §3.3.2.5 Amendments/corrections/delayed entries
• Ch. 3, §3.6.2.2 Reasonable and Necessary Criteria
• Ch. 3, §3.6.2.3 Limitation of Liability Determinations
• Ch. 3, §3.6.2.4 Coding Determinations
• Ch. 3, §3.6.2.5 Denial Types
• Ch. 5, §5.9 Documentation in the Patient’s Medical Record
• Ch. 6, §6.5 Medical Review of Inpatient Hospital Claims for Part A Payment

Other

• International Statistical Classification of Diseases and Related Health Problems (ICD) 10^th Edition (ed.) Coding Manual
• Medicare Learning Network (MLN) 6922507 Medicare Payment Systems Medicare Payment Systems Effective date January 2026. Retrieved from https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/html/medicare-payment-systems.html

Last Updated Sep 3, 2026