Medicare Paid $84M During Two Year Period For Ineligible Nursing Home Stays

The Department of Health and Human Services Office of Inspector General issued a report in February 2019 entitled CMS Improperly Paid Millions Of Dollars For Skilled Nursing Facility Services When The Medicare 3-Day Inpatient Hopsital Stay Requirement Was Not Met that found:

“CMS improperly paid 65 of the 99 SNF claims we sampled when the 3-day rule was not met. Improper payments associated with these 65 claims totaled $481,034. On the basis of our sample results, we estimated that CMS improperly paid $84,202,593 for SNF services that did not meet the 3-day rule during CYs 2013 through 2015.”

“We attribute the improper payments to the absence of a coordinated notification mechanism among the hospitals, beneficiaries, and SNFs to ensure compliance with the 3-day rule. We noted that hospitals did not always provide correct inpatient stay information to SNFs, and SNFs knowingly or unknowingly reported erroneous hospital stay information on their Medicare claims to meet the 3-day rule. We determined that the SNFs used a combination of inpatient and non-inpatient hospital days to determine whether the 3-day rule was met. Because CMS allowed SNF claims to bypass the CWF qualifying stay edit during our audit period, these SNF claims were not matched with the associated hospital claims that reported inpatient stays of less than 3 days.”

“Without a coordinated notification mechanism, CMS does not have sufficient documentary evidence to prevent SNFs from submitting erroneous claims that result in improper payments and to determine whether SNFs were at fault for the improper payments. The “at fault” consideration affects the determination of whether the SNF or beneficiary would be financially liable for the overpayment.”

3-Day Rule

To qualify for posthospital extended care such as SNF services, the beneficiary must have been an inpatient of a hospital for a medically necessary stay of at least 3 consecutive calendar days, not counting the date of discharge (42 CFR § 409.30(a)(1)). The requirement of 3 consecutive calendar days can be met by stays totaling 3 consecutive days in one or more hospitals and may not include observation, emergency room, or discharge days. In addition, the beneficiary must be admitted to the SNF and receive the needed care within 30 calendar days (unless the posthospital SNF care would not be medically appropriate within 30 days) after the date of discharge from a hospital (42 CFR § 409.30(b)).

The report concluded: “Without a coordinated notification mechanism among hospitals, beneficiaries, and SNFs, CMS will continue to improperly pay millions of dollars annually for SNF care when the 3-day rule is not met. There is no effective deterrent or financial risk to SNFs submitting claims with erroneous qualifying inpatient hospital stay information. Although the edits in CMS’s claim processing system may detect that a SNF claim reported erroneous information, CMS has little or no basis to determine whether SNFs were at fault for submitting noncompliant claims. Therefore, in accordance with section 1870 of the Act, if CMS cannot determine the SNFs to be at fault, the improper payment might become an overpayment to beneficiaries. In addition, if beneficiaries were determined to be without fault, recovery may be waived, and CMS would bear the cost of noncompliant SNF care.”


If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publically known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as qui tam attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.

Click here to visit our website or call us toll-free in the United States at 800-295-3959 to be connected with qui tam lawyers (False Claims Act lawyers) in your U.S. state who may assist you with a False Claims Act lawsuit.

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This entry was posted on Saturday, March 2nd, 2019 at 5:24 am. Both comments and pings are currently closed.

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