Do you own or operate a skilled nursing facility (SNF)? If so, it’s important to familiarize yourself with the unique medical coding and billing requirements laid out by the Centers for Medicare and Medicaid Services (CMS). SNFs are subject to a variety of regulatory restrictions, most notably, the Balanced Budget Act of 1997.
These regulatory restrictions are designed to reduce potential fraud and abuse, like double-billing by healthcare providers. However, as the owner or operator of an SNF, it’s your duty to understand and implement these guidelines as part of your practice management strategy. Failing to do so may result in penalties and fines, or in extreme instances, the closure of your facility.
What is the Balanced Budget Act of 1997?
The Balanced Budget Act of 1997 effectively ended the unbundling of services provided by contracted healthcare entities. Under its passage, most services provided to Medicare recipients must be grouped together in a bundle and billed by the SNF in a single, consolidated claim. The SNF must then pay for contracted services using the per diem rate that it receives for each patient.
Consolidated billing is only a requirement under Medicare Part A. If your facility isn’t a certified Part A SNF, then services are billed under Medicare Part B. Therapy services still fall under Part A, regardless of your facility’s certification status. It’s your responsibility to bill each Medicare agency correctly. That’s why it’s so important to partner with a medical coding and billing company you can trust.
What services can SNFs bill for?
SNFs can bill Medicare for a variety of services, including:
- Durable medical equipment
- Screenings
- Laboratory tests
- Transportation to and from medical appointments
- Services performed by a doctor, nurse practitioner or physician assistant
SNFs can also bill for speech therapy, occupational therapy and physical therapy. However, these services must be consolidated in a single bill. As an SNF, you aren’t allowed to bill individual therapists for their time or service.
What is a per diem rate?
The consolidated billing requirements that the Balanced Budget Act of 1997 implemented require Medicare Part A SNFs to receive a set per diem rate. No two set per diem rates is exactly alike.
SNFs calculate this number by determining “reasonable reimbursement” in order to meet the needs of an average SNF resident. Facilities use the per diem rate to provide all medically necessary services a patient requires to heal.
How is SNF billing calculated?
To calculate billing for SNFs, professional medical coders assign specific numbers to particular services. To do this, coders refer to two publications: International Classification of Diseases, 9th Revision, Clinical Modification (ICD-9-CM) and the Healthcare Common Procedural Coding System (HCPCS).
After gathering a list of codes for each service provided, your medical coder outlines and creates a consolidated bill. If necessary, they can also submit the claims separately.
What services are subject to SNF consolidated billing?
Knowing how to correctly bill for services at your SNF is a critical component of both efficiency and profitability. Without a solid understanding of SNF billing requirements, there are plenty of opportunities to make mistakes. Each year, CMS publishes a list of codes that are subject to consolidated billing. The agency also releases codes that are exempt.
It’s important you know which codes are applicable for consolidated billing requirements. Since 1997, Congress has passed several other laws that govern consolidated billing and SNF billing to Medicare Part B. Familiarizing yourself with these updates to the law can go a long way toward preventing charges of healthcare fraud or abuse.
What about Medicaid?
The most common third-party payers for SNF services are Medicare Part A and Medicare Part B. However, most SNFs also rely on Medicaid payments. Each state has a different Medicaid system, including billing protocols and methodology. Although Medicaid programs take direction from CMS, each state pays SNFs differently.
What about private insurance companies?
Some patients use their employment-based insurance to cover SNF costs. Each commercial insurance company provides SNF reimbursement differently, based on guidelines established by CMS.
As you can see, medical billing for SNFs requires significant knowledge and willingness to pay close attention to the details. While this is completely understandable, it’s also a tall order. You have so many other things to worry about, including patient care, day-to-day operations, hiring decisions and more. There’s only so much time in the day, and you can’t do everything yourself.
That’s where we can help. Here at Med USA, we have more than 40 years of industry experience and a national presence. Our medical billing service promises quality results, accurate data and happy clients. When you implement our medical billing software at your SNF, you can feel confident knowing all your medical bills adhere to CMS guidelines regarding bundling and unbundling.
Additionally, our revenue cycle management service can save you time and money. It’s not just our service that’s special, though. It’s our commitment to delivering solutions. Together, we can grow your practice, ensuring all of your patients receive the highest quality care in a hassle-free, streamlined SNF environment.
To learn more about how we can assist your SNF facility, visit our website and fill out an online contact form or give us a call at (801) 352-9500.