Medicare Hot Topics: Medicare Hot Topics: Observation Status v. Inpatient & Observation Status v. Inpatient & The “Improvement Standard” The “Improvement Standard” MythMyth

Issues and AdvocacyIssues and AdvocacyBrenda L. Marrero, Esq.Brenda L. Marrero, Esq.Community Legal Services, Inc.Community Legal Services, Inc.bmarrero@clsphila.orgbmarrero@clsphila.orgAlso see acknowledgement to Center for Medicare Also see acknowledgement to Center for Medicare AdvocacyAdvocacy

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Community Legal Community Legal ServicesServices

We are a non profit public interest We are a non profit public interest agency serving low income agency serving low income Philadelphians in a variety of legal areasPhiladelphians in a variety of legal areas

Aging and Disabilities: this unit serves Aging and Disabilities: this unit serves low income seniors and those with low income seniors and those with disabilitiesdisabilities

We handle Medicare cases—quality of We handle Medicare cases—quality of care, access/coverage, denials, appealscare, access/coverage, denials, appeals

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Center for Medicare Center for Medicare AdvocacyAdvocacy

See their website See their website www.medicareadvocacy.orgwww.medicareadvocacy.org

Source for much of the materials and Source for much of the materials and information presented today is from their information presented today is from their website. Being used with their permission website. Being used with their permission is a portion of their presentation titled is a portion of their presentation titled “Overcoming Barriers to Medicare “Overcoming Barriers to Medicare Coverage of SNF Care”Coverage of SNF Care”

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Medicare basicsMedicare basics

Medicare is a federal health insurance Medicare is a federal health insurance program for those who are at least 65 program for those who are at least 65

You may also get it if you are disabled You may also get it if you are disabled and receiving Social Security Disability and receiving Social Security Disability Insurance (SSDI) or have end stage Insurance (SSDI) or have end stage kidney diseasekidney disease

It is run by the federal governmentIt is run by the federal government Red/white/blue cardRed/white/blue card

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Medicare Basics, con’tMedicare Basics, con’t

Part A—hospital insurancePart A—hospital insurance Part B—doctor’s visits, outpatient Part B—doctor’s visits, outpatient

services, medical equipmentservices, medical equipment Part D—prescription drug coveragePart D—prescription drug coverage You can also choose to have your You can also choose to have your

Medicare through an HMO—Medicare Medicare through an HMO—Medicare Advantage Plan (Part C)Advantage Plan (Part C)

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When can a beneficiary When can a beneficiary lose SNF coverage? lose SNF coverage?

Observation services, which prevent Observation services, which prevent coverage and admission to skilled coverage and admission to skilled nursing facility (“SNF”)nursing facility (“SNF”)

The myth of medical improvement, which The myth of medical improvement, which prevents continued Medicare coverage prevents continued Medicare coverage when the resident is not “improving”when the resident is not “improving”

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New phenomenonNew phenomenon

In the context of a hospital setting, a In the context of a hospital setting, a patient may be told that their stay is not patient may be told that their stay is not “inpatient” but instead they have been in “inpatient” but instead they have been in “observation status”, receiving “observation status”, receiving “observation services”“observation services”

Why is this happening? One possibility: Why is this happening? One possibility: the evolution of the RAC programthe evolution of the RAC program

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Recovery Audit Recovery Audit Contractor (RAC)Contractor (RAC)

Section 306 of the Medicare Prescription Section 306 of the Medicare Prescription Drug, Improvement and Modernization Drug, Improvement and Modernization Act of 2003 (MMA) authorized RAC’s to Act of 2003 (MMA) authorized RAC’s to detect and correct improper payments in detect and correct improper payments in the traditional Medicare program, both the traditional Medicare program, both overpayments and underpaymentsoverpayments and underpayments

Started as demonstration project—Started as demonstration project—moving to permanent nationwide moving to permanent nationwide programprogram

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RAC con’tRAC con’t

The 3 year demonstration project found that The 3 year demonstration project found that RAC contractors (who were paid on a RAC contractors (who were paid on a contingency basis) identified $1.03 billion in contingency basis) identified $1.03 billion in improper paymentsimproper payments 96% in overpayments, 4% in underpayments96% in overpayments, 4% in underpayments

Most of the overpayments (85%) were Most of the overpayments (85%) were collected from inpatient hospitalscollected from inpatient hospitals

Few providers appealed (14%) and few RAC Few providers appealed (14%) and few RAC overpayment determinations were overturned overpayment determinations were overturned on appeal (4.6%)on appeal (4.6%)

1010

UR Committee Authority UR Committee Authority

Even if admitted as an inpatient by a patient’s Even if admitted as an inpatient by a patient’s attending physician, the hospital’s utilization attending physician, the hospital’s utilization review committee may retroactively reverse the review committee may retroactively reverse the admission determination to outpatient admission determination to outpatient observation servicesobservation services Condition Code 44, Transmittal 299 (Sep. 2004), Condition Code 44, Transmittal 299 (Sep. 2004),

now at Medicare Claims Processing Manual, CMS now at Medicare Claims Processing Manual, CMS Pub. No. 100-04, Ch. 1, §50.3, Pub. No. 100-04, Ch. 1, §50.3, http://www.cms.hhs.gov/manuals/downloads/clm104http://www.cms.hhs.gov/manuals/downloads/clm104c01.pdfc01.pdf (scroll down to §50.3 at p. 138) (scroll down to §50.3 at p. 138)

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UR Committee Authority UR Committee Authority con’tcon’t

Since 2004 CMS has authorized hospital Since 2004 CMS has authorized hospital UR Committees to change patients’ UR Committees to change patients’ status from inpatient to outpatient, but status from inpatient to outpatient, but such a retroactive change may be made such a retroactive change may be made only if:only if:

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When can change be When can change be made retroactively?made retroactively?

(1) the change is made while the patient (1) the change is made while the patient is in the hospitalis in the hospital

(2) the hospital has not submitted a claim (2) the hospital has not submitted a claim to Medicare for the inpatient admission to Medicare for the inpatient admission

(3) a physician concurs with the UR (3) a physician concurs with the UR committee’s decision, andcommittee’s decision, and

(4) the physician’s concurrence is (4) the physician’s concurrence is documented in the medical recorddocumented in the medical record

1313

Effect of “observation Effect of “observation status”status”

Why does this matter?Why does this matter? Because a beneficiary could then lose Because a beneficiary could then lose

coverage for subsequent stay in a skilled coverage for subsequent stay in a skilled nursing facility (“SNF”), since Medicare nursing facility (“SNF”), since Medicare statute requires a “3 day qualifying hospital statute requires a “3 day qualifying hospital stay” as an Inpatientstay” as an Inpatient

Time spent in observation status does not Time spent in observation status does not count towards that 3 day qualifying hospital count towards that 3 day qualifying hospital stay statutory requirement! stay statutory requirement!

1414

Effect, con’tEffect, con’t

Beneficiary liability—cost is shiftedBeneficiary liability—cost is shifted Consequences for beneficiaries whose entire Consequences for beneficiaries whose entire

time in hospital is considered to be observation time in hospital is considered to be observation Denied Part A coverage for hospital stayDenied Part A coverage for hospital stay Denied Part A coverage for prescription drugs Denied Part A coverage for prescription drugs

received while in hospitalreceived while in hospital Denied Part A coverage for SNF stayDenied Part A coverage for SNF stay Some beneficiaries who cannot afford to pay for Some beneficiaries who cannot afford to pay for

SNF care go home or to assisted living, SNF care go home or to assisted living, foregoing needed careforegoing needed care

1515

Definition of “3 day Definition of “3 day qualifying hospital stay”qualifying hospital stay”

““The beneficiary must have been The beneficiary must have been hospitalized . . . for medically necessary hospitalized . . . for medically necessary inpatient hospital care . . . for at least 3 inpatient hospital care . . . for at least 3 consecutive calendar days, not counting consecutive calendar days, not counting the day of discharge.” 42 C.F.R. the day of discharge.” 42 C.F.R. §§409.30(a)(1)409.30(a)(1)

1616

““Observation Services”Observation Services”

Neither the Medicare statute nor the Neither the Medicare statute nor the Medicare regulations define “observation Medicare regulations define “observation services”services”

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CMS Manual definitionCMS Manual definition

Defined in CMS’s manuals as “a well-defined Defined in CMS’s manuals as “a well-defined set of specific, clinically appropriate services, set of specific, clinically appropriate services, which include ongoing short term treatment, which include ongoing short term treatment, assessment, and reassessment, that are assessment, and reassessment, that are furnished while a decision is being made furnished while a decision is being made regarding whether patients will require further regarding whether patients will require further treatment as hospital inpatients or if they are treatment as hospital inpatients or if they are able to be discharged from the hospital.” able to be discharged from the hospital.” Medicare Benefit Policy Manual, CMS Pub. No. Medicare Benefit Policy Manual, CMS Pub. No. 100-02, Ch. 6, 100-02, Ch. 6, §§20.6. Same language in 20.6. Same language in Medicare Claims Processing Manual, CMS Medicare Claims Processing Manual, CMS Pub. No.100-04, Ch. 4, Pub. No.100-04, Ch. 4, §290.1.§290.1.

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Time spent in ER? Time spent in ER?

Time spent in observation status in the Time spent in observation status in the emergency room prior to (or instead of) emergency room prior to (or instead of) an inpatient admission does not count an inpatient admission does not count toward the 3-day qualifying inpatient stay. toward the 3-day qualifying inpatient stay. Medicare Benefit Policy Manual, CMS Medicare Benefit Policy Manual, CMS Pub. No. 100-02, Ch. 8, Pub. No. 100-02, Ch. 8, §§20.1.20.1.

1919

CMS Manual thresholdCMS Manual threshold

Manuals say observation should not Manuals say observation should not exceed 24-48 hoursexceed 24-48 hours

Now, increasingly, Medicare Now, increasingly, Medicare beneficiaries’ beneficiaries’ entire entire stay in an acute care stay in an acute care hospital is called observation serviceshospital is called observation services Cases of multiple days and weeks in the Cases of multiple days and weeks in the

hospital, all in observationhospital, all in observation

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What is the criteria?What is the criteria?

Hospitals generally use InterQual criteria Hospitals generally use InterQual criteria (McKesson Corp.) to make coverage (McKesson Corp.) to make coverage decisionsdecisions Proprietary processProprietary process Proprietary criteria, with screens for Proprietary criteria, with screens for

diagnosesdiagnoses Severity of illnessSeverity of illness Intensity of serviceIntensity of service

2121

Beneficiary NoticeBeneficiary Notice

When is written Notice required in the When is written Notice required in the hospital?hospital?

Notice issues unclearNotice issues unclear CMS Manual says beneficiary must be CMS Manual says beneficiary must be

notified by hospital if hospital retroactively notified by hospital if hospital retroactively changes status from inpatient to outpatientchanges status from inpatient to outpatient Few beneficiaries are receiving notices; Few beneficiaries are receiving notices;

notices do not give appeal rightsnotices do not give appeal rights

2222

Beneficiary Notice-SNFBeneficiary Notice-SNF

SNF’s that believe that Medicare SNF’s that believe that Medicare coverage will be denied for a technical coverage will be denied for a technical reason, such as a lack of the 3 day reason, such as a lack of the 3 day qualifying hospital stay, qualifying hospital stay, maymay give the give the resident a Notice of Exclusion of resident a Notice of Exclusion of Medicare Benefits (NEMB). But use of Medicare Benefits (NEMB). But use of this Notice by SNF’s is optionalthis Notice by SNF’s is optional

2323

What does a NEMB do?What does a NEMB do?

Beneficiary is given 3 options:Beneficiary is given 3 options: Option 1: Check Yes beneficiary wants to Option 1: Check Yes beneficiary wants to

receive the services and wants Medicare to receive the services and wants Medicare to make a decision about coverage. SNF must make a decision about coverage. SNF must submit the claim with supporting evidence to submit the claim with supporting evidence to Medicare. If denied, beneficiary agrees to Medicare. If denied, beneficiary agrees to be personally and fully responsible for be personally and fully responsible for paymentpayment

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NEMB options con’tNEMB options con’t

Option 2: Check Yes that beneficiary Option 2: Check Yes that beneficiary wants to receive services, but does not wants to receive services, but does not want the claim to be submitted to want the claim to be submitted to MedicareMedicare

Option 3: Check No, beneficiary does not Option 3: Check No, beneficiary does not want to receive the services and that no want to receive the services and that no claim will be sent to Medicareclaim will be sent to Medicare

2525

Liability to beneficiaryLiability to beneficiary

The Medicare Act states that when a The Medicare Act states that when a determination is made that a service was determination is made that a service was not medically necessary and that not medically necessary and that Medicare will not pay for it, payment will Medicare will not pay for it, payment will nevertheless be made if the beneficiary nevertheless be made if the beneficiary did not know, and could not reasonably did not know, and could not reasonably be expected to know, that payment would be expected to know, that payment would not be made. 42 U.S.C. not be made. 42 U.S.C. §§1395pp, 1879 1395pp, 1879 of the Social Security Actof the Social Security Act

2626

Liability, con’tLiability, con’t

A beneficiary is presumed to not know A beneficiary is presumed to not know “that services are not covered unless the “that services are not covered unless the evidence indicates that written notice was evidence indicates that written notice was given to the beneficiary.” Medicare given to the beneficiary.” Medicare Claims Processing Manual, CMS Pub. Claims Processing Manual, CMS Pub. 100-04, Ch. 30, 100-04, Ch. 30, §§30.130.1

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Liability to provider?Liability to provider?

A Medicare contractor has the authority A Medicare contractor has the authority and discretion to shift payment liability to and discretion to shift payment liability to the provider. Provider then has appeal the provider. Provider then has appeal rights.rights.

Failure to inform the beneficiary when Failure to inform the beneficiary when services are not medically necessary will services are not medically necessary will relieve the beneficiary of responsibility of relieve the beneficiary of responsibility of paying for the service.paying for the service.

2828

How to advocate?How to advocate?

Always appealAlways appeal Call CLS for legal representationCall CLS for legal representation Contact the Quality Improvement Contact the Quality Improvement

Organization (QIO) for your State. PA’s is Organization (QIO) for your State. PA’s is Quality Insights of PA. Quality Insights of PA. http://www.qipa.org/pa/default.aspxhttp://www.qipa.org/pa/default.aspx

2929

ClarificationClarification

DistinguishDistinguish Observation statusObservation status Inpatient hospital denialInpatient hospital denial

Patient gets notice, with expedited appeal rights Patient gets notice, with expedited appeal rights that should be exercised by noon of the first that should be exercised by noon of the first working day after written notice is received. 42 working day after written notice is received. 42 C.F.R. §405.1206C.F.R. §405.1206

If expedited appeal is not exercised, patient can If expedited appeal is not exercised, patient can appeal non-covered charges using the standard appeal non-covered charges using the standard appeal system. 42 C.F.R. §405.900 appeal system. 42 C.F.R. §405.900 et seqet seq

3030

Advocacy con’tAdvocacy con’t

CMA and many Medicare advocates take CMA and many Medicare advocates take the position that CMS requires hospitals the position that CMS requires hospitals to give a beneficiary an Advance to give a beneficiary an Advance Beneficiary Notice (ABN) if their Beneficiary Notice (ABN) if their observation status exceeds the period of observation status exceeds the period of time (threshold) authorized for time (threshold) authorized for observation servicesobservation services

In CMA’s experience, hospitals are NOT In CMA’s experience, hospitals are NOT giving such notice of non-coveragegiving such notice of non-coverage

3131

Appeals and notice Appeals and notice scenariosscenarios

If notice rec’d: appeal so Medicare can If notice rec’d: appeal so Medicare can make initial determination of coveragemake initial determination of coverage

No notice rec’d: file request with No notice rec’d: file request with Medicare Administrative Contractor Medicare Administrative Contractor (MAC), asking that the contractor review (MAC), asking that the contractor review the information and determine whether the information and determine whether they met inpatient criteriathey met inpatient criteria

3232

Appeals con’tAppeals con’t

If receive denial of coverage for If receive denial of coverage for subsequent SNF stay, should appeal that subsequent SNF stay, should appeal that at the same time they appeal their at the same time they appeal their observation status in the hospitalobservation status in the hospital

If beneficiary is billed for prescription If beneficiary is billed for prescription drugs during their hospital stay, they drugs during their hospital stay, they should use their Part D plan’s process for should use their Part D plan’s process for submitting claims from an out of network submitting claims from an out of network pharmacypharmacy

3333

Appeals: What To DoAppeals: What To Do

Ask hospital for copy ofAsk hospital for copy of Emergency room recordsEmergency room records Admission recordsAdmission records Physician ordersPhysician orders Consultation reportsConsultation reports Lab reportsLab reports Diagnostic imagingDiagnostic imaging Medication recordsMedication records Nursing narrativesNursing narratives Discharge summaryDischarge summary Social service documentationSocial service documentation

3434

Appeals…Appeals…

Review records with nurse or physician Review records with nurse or physician to determine whether care was rendered to determine whether care was rendered at an inpatient level of careat an inpatient level of care Services required can Services required can onlyonly be provided in a be provided in a

hospitalhospital 24-hour availability of a physician24-hour availability of a physician Special equipment available only in a hospitalSpecial equipment available only in a hospital

3535

Hospital inpatient level of Hospital inpatient level of carecare

The severity of signs and symptoms exhibited by the The severity of signs and symptoms exhibited by the patientpatient

The medical predictability of something adverse The medical predictability of something adverse happening to the patienthappening to the patient

The need for diagnostic studies that appropriately are The need for diagnostic studies that appropriately are outpatient services (i.e., their performance does not outpatient services (i.e., their performance does not ordinarily require the patient to remain at the hospital ordinarily require the patient to remain at the hospital for 24 hours or more) to assist in assessing whether for 24 hours or more) to assist in assessing whether the patient should be admittedthe patient should be admitted

The availability of diagnostic procedures at the time The availability of diagnostic procedures at the time when and at the location where the patient presents.when and at the location where the patient presents.

Medicare Benefit Policy Manual, Pub. 100-02, Ch. 1, §10Medicare Benefit Policy Manual, Pub. 100-02, Ch. 1, §10

3636

RedeterminationRedetermination

Obtain from beneficiary Medicare Obtain from beneficiary Medicare Summary Notice (MSN) for the days Summary Notice (MSN) for the days beneficiary was at the hospitalbeneficiary was at the hospital MSN is quarterly notice from CMSMSN is quarterly notice from CMS All pages (appeal information on last page)All pages (appeal information on last page) Find hospital services billed to Medicare Part Find hospital services billed to Medicare Part

B, which will have a “control number.”B, which will have a “control number.” 120 days to appeal (last date to appeal is 120 days to appeal (last date to appeal is

identified on last page of MSN)identified on last page of MSN)

3737

Redetermination con’tRedetermination con’t

Request redeterminationRequest redetermination If late, assert good cause. For example,If late, assert good cause. For example,

The party was prevented by serious illness from The party was prevented by serious illness from contacting the contractor, orcontacting the contractor, or

The party had a death or serious illness in his or The party had a death or serious illness in his or her immediate family.her immediate family.

42 C.F.R. §405.94242 C.F.R. §405.942

3838

Redetermination, con’tRedetermination, con’t

In cover letter, write that the services In cover letter, write that the services billed by hospital under control number: billed by hospital under control number: xxx were inappropriately billed to xxx were inappropriately billed to Medicare Part B. The beneficiary was Medicare Part B. The beneficiary was receiving an inpatient level of care during receiving an inpatient level of care during the days at issue and thus the care the days at issue and thus the care should have been billed to Medicare Part should have been billed to Medicare Part A.A.

3939

ReconsiderationReconsideration

Redetermination is denied (hospital and SNF)Redetermination is denied (hospital and SNF) 180 days to request Reconsideration180 days to request Reconsideration If hospital redetermination does not address If hospital redetermination does not address

observation issue, write the Medicare contractor and observation issue, write the Medicare contractor and ask that the issue be addressed.ask that the issue be addressed.

Request Reconsideration. On hospital Request Reconsideration. On hospital reconsideration request, reiterate language reconsideration request, reiterate language regarding inappropriate billing to Medicare Part B.regarding inappropriate billing to Medicare Part B.

Get physician statements in support of hospital Get physician statements in support of hospital inpatient level of care and SNF level of care.inpatient level of care and SNF level of care.

4040

ALJ level of appealALJ level of appeal

Reconsideration is denied (Hospital and Reconsideration is denied (Hospital and SNF)SNF) 60 days to appeal60 days to appeal

If observation status is not addressed by If observation status is not addressed by redetermination, write to Medicare Contractor redetermination, write to Medicare Contractor and request that it be addressed.and request that it be addressed.

On Administrative Law Judge request, indicate On Administrative Law Judge request, indicate that reason for appeal is that Part B was that reason for appeal is that Part B was inappropriately billed for Part A hospital inpatient inappropriately billed for Part A hospital inpatient care.care.

4141

The HearingThe Hearing

Administrative Law Judge hearingAdministrative Law Judge hearing Request hearing by video teleconferenceRequest hearing by video teleconference If possible, have a medical expert testifyIf possible, have a medical expert testify Have family testifyHave family testify Try to have both hospital and SNF case heard by Try to have both hospital and SNF case heard by

same ALJ on the same daysame ALJ on the same day Get a copy of the Office of Medicare and Appeals’ Get a copy of the Office of Medicare and Appeals’

case file. 42 C.F.R. §405.1042.case file. 42 C.F.R. §405.1042. Submit additional records and statements, as Submit additional records and statements, as

needed (permissible under 42 C.F.R. §405.1018).needed (permissible under 42 C.F.R. §405.1018).

4242

Appeal and appeal…and Appeal and appeal…and appealappeal

Many of the observation status cases are Many of the observation status cases are won at the higher level of appealswon at the higher level of appeals

Don’t give up if the first levels of appeal Don’t give up if the first levels of appeal are not in beneficiary’s favorare not in beneficiary’s favor

Keep appealing to ALJ level where many Keep appealing to ALJ level where many favorable decisions are being madefavorable decisions are being made

4343

Favorable DecisionsFavorable Decisions

ALJ Appeal No. 1-517883673 (Jan. 8, 2010), ALJ Appeal No. 1-517883673 (Jan. 8, 2010), http://www.medicareadvocacy.org/InfoByTopic/Observhttp://www.medicareadvocacy.org/InfoByTopic/ObservationStatus/Decisions/VT_ALJ_01.10.pdfationStatus/Decisions/VT_ALJ_01.10.pdf Patient required monitoring, assessment, Patient required monitoring, assessment,

intravenous fluids (including intravenous morphine)intravenous fluids (including intravenous morphine) ALJ overruled Maximus Federal Services and held ALJ overruled Maximus Federal Services and held

entire 5-day hospital stay was coveredentire 5-day hospital stay was covered ALJ relied on Medicare Benefit Policy Manual, CMS ALJ relied on Medicare Benefit Policy Manual, CMS

Pub. No. 100-02, Ch. 1, Pub. No. 100-02, Ch. 1, §§6; and QIO Manual, CMS 6; and QIO Manual, CMS Pub. No. 100-10, Ch. 4, Pub. No. 100-10, Ch. 4, §§4110, describing complex 4110, describing complex medical judgment that considers patient’s medical medical judgment that considers patient’s medical history, current medical needs, severity of signs and history, current medical needs, severity of signs and symptomssymptoms

4444

Favorable Decisions con’tFavorable Decisions con’t

ALJ Appeal No. 1-380068132 (April 9, 2009), ALJ Appeal No. 1-380068132 (April 9, 2009), http://www.medicareadvocacy.org/InfoByTopic/http://www.medicareadvocacy.org/InfoByTopic/ObservationStatus/Decisions/WI_ALJ_04.09.0ObservationStatus/Decisions/WI_ALJ_04.09.09.pdf9.pdf ALJ addressed denial of 30-day SNF stay for lack of ALJ addressed denial of 30-day SNF stay for lack of

3-day hospital stay, when resident had been in 3-day hospital stay, when resident had been in hospital for 13 dayshospital for 13 days

ALJ found resident met hospital stay and needed ALJ found resident met hospital stay and needed and received Medicare-covered care in SNFand received Medicare-covered care in SNF

4545

The myth of The myth of “improvement”“improvement”

Medicare coverage of care and services Medicare coverage of care and services in a SNF does not depend on the in a SNF does not depend on the resident’s “improving.”resident’s “improving.”

4646

Myth, con’tMyth, con’t

Restoration potential is not a valid reason Restoration potential is not a valid reason for denial of coveragefor denial of coverage ““Even if full recovery or medical Even if full recovery or medical

improvement is not possible, a resident may improvement is not possible, a resident may need skilled services to prevent further need skilled services to prevent further deterioration or preserve current deterioration or preserve current capabilities.” capabilities.” 42 C.F.R. 42 C.F.R. §409.32(c)§409.32(c) Example: “A terminal cancer patient may need Example: “A terminal cancer patient may need

some of the skilled services described in some of the skilled services described in §409.33.” 42 C.F.R. §409.32(c)§409.33.” 42 C.F.R. §409.32(c)

4747

Maintenance Level Maintenance Level TherapyTherapy

Maintenance rehabilitation therapy is a Maintenance rehabilitation therapy is a Medicare-covered serviceMedicare-covered service ““. . . when the specialized knowledge of a . . . when the specialized knowledge of a

qualified therapist is required to design and qualified therapist is required to design and establish a maintenance program based on establish a maintenance program based on an initial evaluation and periodic assessment an initial evaluation and periodic assessment of a resident’s needs….” of a resident’s needs….” 42 C.F.R 42 C.F.R §409.33(c)(5)§409.33(c)(5)

4848

Criteria for Individual Criteria for Individual AssessmentAssessment

Medicare should not use “rules of thumb,” such Medicare should not use “rules of thumb,” such asas Lack of restoration potential, CMS Pub. No. 100-02, Lack of restoration potential, CMS Pub. No. 100-02,

Ch. 8, 30.2.2 (“When rehabilitation services are the Ch. 8, 30.2.2 (“When rehabilitation services are the primary services, the key issue is whether the skills primary services, the key issue is whether the skills of a therapist are needed. The deciding factor is not of a therapist are needed. The deciding factor is not the patient’s potential for recovery, but whether the the patient’s potential for recovery, but whether the services needed require the skills of a therapist or services needed require the skills of a therapist or whether they can be provided by nonskilled whether they can be provided by nonskilled personnel.”)personnel.”)

4949

Good case lawGood case law

Fox v. BowenFox v. Bowen, 656 F. Supp. 1236 (D. Conn. 1987), 656 F. Supp. 1236 (D. Conn. 1987) Need for skilled nursing must be based solely upon Need for skilled nursing must be based solely upon

beneficiary’s unique condition and individual needsbeneficiary’s unique condition and individual needs Court rejected “informal presumptions” or “rules of thumb” that Court rejected “informal presumptions” or “rules of thumb” that

denied coverage to beneficiaries who were not in weight-denied coverage to beneficiaries who were not in weight-bearing stage of rehabilitation, amputees who did not have bearing stage of rehabilitation, amputees who did not have prostheses, beneficiaries who could ambulate 50 feet with prostheses, beneficiaries who could ambulate 50 feet with supervisionsupervision

Court held that the Secretary’s practice of denying Medicare Court held that the Secretary’s practice of denying Medicare coverage violated the Due Process Clause of the Fifth coverage violated the Due Process Clause of the Fifth AmendmentAmendment

5050

Favorable ALJ DecisionsFavorable ALJ Decisions

ALJ Appeal No. 1-517589113 (Jan. 25, 2010)ALJ Appeal No. 1-517589113 (Jan. 25, 2010) ALJ reverses QIO decision, which affirmed Medicare ALJ reverses QIO decision, which affirmed Medicare

Advantage Plan’s termination of Medicare beneficiary’s SNF Advantage Plan’s termination of Medicare beneficiary’s SNF coverage, based on alleged stabilization of therapeutic coverage, based on alleged stabilization of therapeutic regimen and no need for additional skilled nursing care, regimen and no need for additional skilled nursing care, http://www.medicareadvocacy.org/ALJDecisions/1-517589113.http://www.medicareadvocacy.org/ALJDecisions/1-517589113.pdfpdf

ALJ finds coverage for resident with “very complex medical ALJ finds coverage for resident with “very complex medical history.” Additional therapy needed for resident to reach history.” Additional therapy needed for resident to reach therapy goals, to prevent deterioration, and to preserve therapy goals, to prevent deterioration, and to preserve function. When resident’s medical condition destabilized, she function. When resident’s medical condition destabilized, she needed skilled nursing observation and monitoring of her high-needed skilled nursing observation and monitoring of her high-risk MRSA infection and “complicating underlying condition.”risk MRSA infection and “complicating underlying condition.”

5151

SNF notice of non-SNF notice of non-coverage coverage

Ensure the notice is validEnsure the notice is valid Is it signed/dated by beneficiary?Is it signed/dated by beneficiary? What is the rationale? Lack of improvement, What is the rationale? Lack of improvement,

patient reached a plateau, chronic condition patient reached a plateau, chronic condition requires only maintenance therapyrequires only maintenance therapy

What is the appeal deadline? To whom do What is the appeal deadline? To whom do you appeal? you appeal?

5252

Request…Request…

Statement of support from physicianStatement of support from physician Review SNF medical recordsReview SNF medical records

Daily skilled careDaily skilled care 5 times per week, therapy, or5 times per week, therapy, or 7 times per week, skilled nursing7 times per week, skilled nursing

42 C.F.R. §§409.32 and 409.33 (definition of 42 C.F.R. §§409.32 and 409.33 (definition of skilled care)skilled care)

5353

Do you have clients Do you have clients affected? affected?

If you have consumers who you know If you have consumers who you know were denied Medicare coverage under were denied Medicare coverage under this “improvement standard”, contact the this “improvement standard”, contact the Center for Medicare AdvocacyCenter for Medicare Advocacy

Can also contact CLSCan also contact CLS Litigation is under way regarding this Litigation is under way regarding this

standardstandard

5454

ResourcesResources

ResourcesResources CMA, Observation Status, CMA, Observation Status,

http://www.medicareadvocacy.org/InfoByTophttp://www.medicareadvocacy.org/InfoByTopic/ObservationStatus/ObservationMain.htmic/ObservationStatus/ObservationMain.htm Includes links to Weekly Alerts, articles, other Includes links to Weekly Alerts, articles, other

resourcesresources

Community Legal Services, Inc., (215) 227-Community Legal Services, Inc., (215) 227-2400, 3638 N. Broad St., Philadelphia PA 2400, 3638 N. Broad St., Philadelphia PA 1914019140

5555

AcknowledgmentAcknowledgment

Various slides from this presentation Various slides from this presentation were taken from the Center for Medicare were taken from the Center for Medicare Advocacy’s Presentation “Overcoming Advocacy’s Presentation “Overcoming Barriers to Medicare Coverage of Skilled Barriers to Medicare Coverage of Skilled Nursing Facility Care”, authored by Toby Nursing Facility Care”, authored by Toby S. Edelman, Esquire, presented to the NJ S. Edelman, Esquire, presented to the NJ Elder Law Section Roundtable, February Elder Law Section Roundtable, February 14, 2011, copyright @ Center for 14, 2011, copyright @ Center for Medicare Advocacy, Inc.Medicare Advocacy, Inc.