The Georgia Scroll
October 1998
Changes in Skilled Nursing
Facility (SNF)
Prospective Payment Regulatory Support
by Wiley Sloan
The Health Care Financing Administration (HCFA) requires that all sub-acute units, skilled nursing facilities, and other long-term care facilities move to a prospective payment system called Resource Utilization Groupings (RUGS III). This regulation will affect providers beginning with the first cost reporting period for Medicare patients on or after July 1, 1998. The new regulation will require providers to include new data on the UB-92 claim for Medicare beneficiaries receiving post-acute care services in a skilled nursing facility. The RUGS III calculations are based on the Minimum Data Set (MDS) clinical assessment. All long-term care facilities are required by HCFA to electronically submit their MDS by June 22, 1998.
Additional requirements that will also affect long-term care billing include consolidated billing and line item date of service reporting. Consolidated billing will require that skilled nursing facilities (SNFs) must submit the Medicare claims for all services that its residents receive (both Part A and Part B services), except for certain excluded services defined by HCFA. Consolidated billing is effective as of July 1, 1998, for SNFs who are on prospective payment prior to January 1, 1999. SNF providers who are not on prospective payment prior to January 1, 1999, must transition to consolidated billing by the January 1, 1999, mandated date.
Line item reporting will require SNF providers to report dates of service per revenue code line for services that its residents receive for both Medicare Part A and Part B beneficiaries. Line item reporting is effective for claims with dates of service on or after October 1, 1998.
The HIPPS rate code is a five-character, alphanumeric code that consists of a three-character RUGS III code as well as a two-character modifier to indicate the assessment level (e.g., 5-day, 14 -day, and 30-day assessment).
You are required to submit clinical assessments (Minimum Data Set - MDS 2) to Medicare at defined intervals and report the HIPPS Rate Code on the resident/patient bill to indicate the result of the clinical assessment. The HIPPS Rate Code will determine the per diem reimbursement that your facility will receive for the period of time that the assessment covers. You may obtain free software (supplied by HCFA) that will facilitate the entry of assessment data, the automatic calculation of the Resource Utilization Group (RUG) based on that assessment, and the ability to electronically submit MDS data directly to Medicare. The free software is available through HCFA's Internet site at:
www.hcfa.gov/medicare/hsqb/mds20/RAVEN.htm
HCFA requires that the UB-92 claim include the following information:
The actual MDS assessment and RUG III group assignment must be handled by your front-end system (if that system is capable of producing assessments) or through the free HCFA software that is available to you.
Consolidated billing will require your SNF unit/facility to include all services rendered to a patient on the SNF facility UB-92 claim. This will require you to modify your current procedures to collect all charges rendered by other providers and enter the charges into Patient Accounting. Current PA features enable you to control the display of all charges related to an account appropriately on the UB-92 claim.
The consolidated billing regulation will also require SNF providers to print HCPCS procedure codes on Medicare Part B claims. A transition period of July 1, 1998, through December 31, 1998, was initially communicated by the Health Care Financing Administration (HCFA) for the printing of HCPCS on SNF Part B claims. However, some fiscal intermediaries have indicated that the consolidated billing requirement for Part B services has been postponed. You should check with your intermediary if you have not received clear communication on the implementation date. When your unit/facility implements this requirement, all services rendered to a Part B patient must be billed with the appropriate HCPCS code, if applicable, on the SNF UB-92 claim.
Line item date of service reporting will be required as of October 1, 1998. SNFs will need to report line item dates of service per revenue code line on the UB-92 for services that its residents receive. This requirement applies to both Medicare Part A and Part B residents.
Wiley Sloan is an Account Executive with SMS and has been an active member of the Ga. Chapter for the past 15 years.
Last modified: June 22, 2001