Medicare Compliance & Reimbursement

How therapists can correct these costly blunders.

Therapists should think twice before they treat one more patient in a skilled nursing facility without a written agreement from the SNF. The therapist could wind up working for free -- or even getting in trouble with the feds.

Under the consolidated billing provisions for SNFs, the facility is responsible for billing Medicare Part B for all services provided by outside suppliers -- such as physical, occupational and speech therapists -- and then must pay the supplier from the reimbursement the SNF receives.

Further, the SNF and the supplier must be operating under an "arrangement" put forth in a "written agreement to reimburse the outside entity for Medicare-covered services subject to consolidated billing; i.e., services that are reimbursable only to the SNF as part of its global PPS per diem or those Part B services that must be billed by the SNF."

That's according to Transmittal 183 from the Centers for Medicare & Medicaid Services, which clarifies the requirements that must be met for a SNF to have a valid "arrangement" in effect with an outside supplier.

The problem: CMS released this clarification because many therapists (and other suppliers) are providing services to patients in SNFs in the absence of a written agreement with the facility.

The consequences: Without a written agreement in place, the therapist has no recourse if the SNF doesn't pay her for her services, and she's not allowed to bill for those services herself under Part B, notes consultant Pauline Watts, a physical therapist with Encompass Consulting Education LLC in Ft. Lauderdale, FL. Further, a therapist might improperly attempt to bill Part B directly for the services, not realizing the patient is under consolidated billing, the transmittal continues. If that occurs, the therapist not only will be denied payment from CMS, but could even face civil money penalties, CMS warns.