Although the Centers for Medicare & Medicaid Services’ (CMS) beneficiary notices have been part of Medicare regulations for a long time, they can still be cited during any survey. Lengthy discussions in the AANAConnect LTC - MDS Network community have explored beneficiary notices and highlighted areas of uncertainty. With new folks entering the world of long-term care (welcome!), it is a good time to provide an overview of the requirements and share where to find additional help on these notices.
When a resident in a nursing facility is covered under Medicare Part A, the facility is responsible for managing the Medicare benefits and making appropriate decisions regarding coverage. The question that must be asked every day of the resident’s skilled stay is “Does the resident meet the coverage criteria for Medicare skilled care?” If the answer is “yes,” the skilled care continues. But if the answer becomes “no,” the facility must communicate that information to the beneficiary and/or the responsible party by using the specific, CMS-approved notices.
Under federal and state laws, Medicare beneficiaries have rights while residing in the nursing home, to help ensure that a beneficiary receives the care and services they need. One of these rights is to be informed when care and services will most probably not be covered by their Medicare benefits. The nursing home must inform the resident of the decision to end skilled care and the option to appeal; this notice must be in writing and in a language that can be easily understood. The beneficiary and/or their representative are then asked to acknowledge in writing (by signature) that they have received the information.
Failure to deliver the correct notices to the resident has serious consequences. Not only could there be survey noncompliance results, such as F tag 550 (Resident Rights) and F582 (Medicaid/Medicare Coverage/Liability Notice), but inadequate notice also carries financial risks. If the facility does not notify the resident of their rights, it faces the possibility of provider liability—in other words, with no other entity to bill, so the facility becomes responsible for paying for those services. Competency of the staff member completing the notice and informing the resident is key to prevent the adverse impacts of an invalid notice.
CMS has two distinct and separate processes, addressing both the financial liability and appeal considerations, to ensure that Medicare Part A beneficiaries receive proper notification.
- Notice of Medicare Denial of Coverage (SNF ABN ): This notice informs beneficiaries of their financial liability for expenses after coverage ends and advises they can request a demand bill via the UB-04 claims process.
- Notice of Medicare Non-Coverage (NOMNC) (CMS-10123) or Expedited Review Process: This notice informs the beneficiary of their ability to contact the Beneficiary and Family Centered Quality Improvement Organization (BFCC-QIO) to request an appeal when seeking to overturn the facility’s clinical decision to end coverage.
It is important for facilities to have a process in place for issuing these notices timely, even on weekends and holidays. Notices of non-coverage may not be backdated. More information on beneficiary notices and the corresponding forms can be located here.
When a facility determines a resident will not be covered, the resident or resident’s representative must be formally notified in writing of the date that non-coverage will begin and the reason for non-coverage—for example, if a service is not reasonable and necessary, or the care is custodial. The facility conveys this information by providing a written notice via the SNF ABN (CMS 10055)(2018). The purpose of the SNF ABN is to notify the beneficiary and/or responsible party of the potential liability for payment for non-covered services. The notice provides information to residents so that they can decide if they wish to continue receiving skilled services that may not be paid for by Medicare and assume financial responsibility. In addition, the notice also informs the beneficiary they have the right to appeal the facility decision by way of a demand bill (a review conducted by the Medicare Administrative Contractor [MAC]).
Regarding the SNF ABN, Maureen McCarthy, RN, BS, RAC-MT, QCP-MT DNS-MT, president and CEO of Celtic Consulting, LLC, noted in a recent interview that the facility must also be aware of the status of a medically complex resident. She shared an example from her practice, in which a facility had provided the SNF ABN to the family several days before the last covered day, but the family complained to the state during an annual survey and indicated that they did not have enough time for an informed decision. When the state reviewed the complaint, it ruled in favor of the family and cited the facility for not giving adequate time for discharge planning. McCarthy stated, “Discharge planning needs to start at the time of admission, so the family does not get a surprise when they receive the notice.” Consider all the factors that will be involved with a medically complex resident, as there are often many arrangements that need to be completed before the resident can return home. Discharge planning continues throughout the resident’s stay, and keeping the family involved during every step of the process is critical.
McCarthy noted that facilities are doing a fairly good job completing the documents and now realize that the Health Information Claim (HIC) number must not be entered on either of the forms. McCarthy also emphasized that the provider must document that the beneficiary or responsible party understands the notice, has had questions answered, and understands their rights to appeal. She provided an example for when the SNF ABN is reviewed by the QIO: some providers receive an invalid delivery message if the responsible party does not indicate their choice in one of the option boxes, and then the facility is held liable. As providers, remember (as noted in the SNF ABN instructions): “If the beneficiary refuses to choose an option or refuses to sign the SNF ABN when required, the SNF should annotate the original copy of the SNF ABN indicating the refusal to sign and may list a witness to the refusal. The SNF should consider not furnishing the care.”
The other notice is the NOMNC which informs the beneficiary of his or her right to an expediated review of a service’s termination. The skilled nursing facility (SNF) must issue this notice when there is a termination of all Medicare Part A services for coverage reasons. It provides a prompt method for the beneficiary and/or representative to protest the facility’s decision to stop the Medicare coverage. The notice must be given to the beneficiary with enough time that the review determination can be made almost before the coverage stops.
The notice is not required when a resident transfers to the hospital or to another SNF for skilled care. It is also not required if a resident exhausts his or her 100 days or decides to end coverage.
For Medicare Part A, the NOMNC is required when skilled coverage is ending and the resident is either staying in the nursing facility or being discharged to a lower level of care, such as to home, assisted living, or independent living services. The NOMNC must be delivered at least two calendar days before Medicare covered services end. It should be noted that the two-day requirement is not a 48-hour requirement. The facility must ensure that the beneficiary or representative signs and dates the NOMNC to demonstrate that the notice was received and understands that the termination decision can be disputed. Assistive devices may be used to obtain a signature.
If a resident is incapable of understanding the notification of the changes and the facility is unable to deliver the notice personally to the resident’s representative, the provider should call the representative to discuss with him or her when the enrollee’s services are no longer covered. The date of that conversation is the date of the receipt of the notice. For confirmation, send the notice to the representative by certified mail, return receipt requested. Instructions are available on the CMS website here.
When direct phone contact cannot be made, send the notice to the representative by certified mail, return receipt requested. The date that someone at the representative’s address signs (or refuses to sign) the receipt is the date of receipt. Place a dated copy of the notice in the enrollee’s medical file. When notices are returned by the post office with no indication of a refusal date, then the enrollee’s liability starts on the second working day after the provider’s mailing date.
McCarthy highlighted another concern involving situations she has experienced in which some auditors used the Brief Interview for Mental Status (BIMS) test score. When a resident whose BIMS score was less than 13 signed the paperwork, the Medicare reviewer ruled that the resident should not have signed the document because of their mental status and the claim is invalid. Please note that this anecdote was a personal experience and there is no rule stating this; however, facilities need to be prepared if this would affect their claims. Therefore, be aware of what the documentation indicates on the resident’s ability to understand.
Another issue McCarthy raised addressed situations in which a resident receives the NOMNC with the last covered day noted and decides that they want to leave the facility earlier. In such cases, it’s important to remember that the facility no longer must adhere to the two-day time frame. Applying the requirements for beneficiary notice, reviewers have made the provider liable if the notice was issued and the beneficiary did not have the two days. But if the resident chooses to leave the facility earlier, it becomes an unplanned discharge, and must be coded accordingly on the MDS. In this instance, the facility must clearly document what transpired and that the resident or their responsible party made the decision to leave early. The documentation and the medical record, including the MDS, must match.
If the Medicare beneficiary wants to appeal the facility’s decision that a skilled level of care is no longer required, the beneficiary must be provided information on how to contact the BFCC-QIO for a decision about the facility’s intention to discharge from skilled coverage. When the BFCC-QIO receives the NOMNC, the facility will be notified and must then issue a Detailed Explanation of Non-Coverage (DENC) (CMS -10124) and return the BFCC-QIO’s requested medical record information by the end of the business day of notification. The information is used by the QIO to make a determination about the end of coverage and allows the facility the opportunity to provide information to support the decision to end coverage.
Notices and Medicare Advantage (MA) Plans
McCarthy also discussed some happenings she has encountered regarding residents covered under a Medicare Advantage (MA) plan. There have been some interesting developments.
As background, MA plans are under the auspices of a private insurance company that makes the coverage and benefit decisions for the plan enrollee or member. Payment is made according to the terms of an agreement between the facility and the insurance company. Although required to provide the same basic coverage offered under Medicare Part A, the MA plan coverage and benefits may vary. Health Maintenance Organizations (HMOs) or Preferred Provider Organizations (PPOs) may have their own requirements for nursing facility providers caring for their members.
McCarthy noted that, several years ago, following the judicial settlement of the Grijalva vs. Shalala case (regarding CMS’s failure to implement and enforce proper due process protections for Medicare HMO appeals), insurance companies reached out to facilities by letter and said that the SNF would be responsible for both issuing and delivering the notices. This “notification” requirement was included in the agreements between providers and insurance companies, but facilities did not read the agreements carefully enough. As a result, the issue of liability has been shifted from the insurance company to the facility. Remember: the entity issuing the notice is the party liable.
In the past, the MA plan issued the notices, and the facility delivered them to the resident or responsible party. McCarthy believes that the insurance companies experienced loss of revenue with claim denials related to the issuing, such as when notices were not completed accurately or didn’t have all the “t’s crossed and i’s dotted.” To rectify the problem for the insurance companies, MA plans have made it part of the SNF’s contract that the facility is responsible for both the issuing and delivering of the notices.
McCarthy stated, “Many providers did not understand the shift in liability and took it on, thinking it would be easier anyway since they were already delivering the notices. The facilities were not fully understanding that whoever issues the notice holds the liability.”
In the letters sent to facilities, MA plan companies told administration that the facility may become liable. Instead of signing it, the facility could have said “No, we are not going to assume that responsibility,” but where they agreed to the terms, the facilities are contractually bound. McCarthy added that once the facility assumed the responsibility for issuing and delivering the notices, the MA plans will not let them reverse their decision.
Another part of the letter from the insurance company directed the facility to notify the insurance company in writing of its decision about assuming this responsibility. McCarthy noted that few facilities have done that. Obviously, the word to the wise is—read every agreement received (from anyone) carefully. Do not sign something without knowing what it says, and do not provide a written statement that may bind the facility without consulting with leadership and counsel. Nurse assessment coordinators should ensure that administration is aware of these pitfalls.
Before a facility signs up with an insurance company, McCarthy recommended, “Facilities need to reach out to their MA partners and find out what the expectations are for notices, certifications, documentation—get their expectations in writing. Be proactive with the payer. Talk to the person developing your contract. In addition, make sure the other members of the team are educated as to what is required or expected. For example, provide weekly notes, a summary, and guidance on what the insurance companies want on admission or discharge. Then, audit for compliance to reduce the risk of denials.
It is critical to both understand and audit the issue of beneficiary notices. While the nuances of the requirements can be tricky, understanding the basics, following the notice instructions carefully, and using available resources will ease the process for the facility and the beneficiary. Some additional resources that can assist with implementation are:
Remember, the residents have worked hard for their Medicare benefits and have the right to use them. The facility must ensure the benefits are used properly, but by clearly understanding the beneficiary notice process, the facility can meet the requirements while providing clear and appropriate communications.
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