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Skilled nursing facility consolidated billing came into effect in 1997 with the passing of the Balanced Budget Act by Congress. Since the BBA’s passing, SNFs, and not outside suppliers, have been required to submit Medicare claims for all the skilled nursing facility consolidated billing services provided to their residents. This, however, does not account for services excluded from Medicare Part A or B. It is worth noting that skilled nursing facility consolidated billing resembles the 1980s bundling requirement for inpatient hospitals.

Prior to the Balanced Budget Act, a Skilled Nursing Facility (SNF) could only provide services to a resident as covered by Medicare Part A stay when:

  • Using its own resources and tracking them using long term care software or 
  • Providing services through the SNF’s transfer agreement hospital or
  • Using an independent therapist for physical, occupational, or speech therapy services
Nurse documenting the services provided by her facility.
Skilled nursing facility consolidated billing requires that SNFs submit Medicare claims.

In addition to this, a SNF could “unbundle” a service by having an outside supplier provide a service to residents. Then, the external supplier would submit a bill to Medicare Part B without involving the SNF anywhere in the process. These practices resulted in several problems, and they include:

  • Potential for duplicate billing by the SNF and the outside supplier
  • Increased out-of-pocket liabilities for services not covered by Medicare.
  • Dispersal of responsibility and poorer coordination of care due to the involvement of multiple outside suppliers, thus potentially reducing the quality of care provided

Since the implementation of the BBA, though, skilled nursing facility consolidated billing has involved fewer instances of duplicate billing for the same service billed to Medicare Part A and Medicare Part B by outside suppliers. It has also enhanced the ability to deliver the best care to residents by enabling SNFs to oversee and coordinate the entire care process of their residents.

Services Included in SNF Consolidated Billing

SNFs should be aware of the services included in SNF consolidated billing, which are outlined in a peer-reviewed article published by the National Center for Biotechnology Information. Services provided in a Medicare Part-A-approved SNF stay count toward consolidated billing. In other words, if a resident’s stay is covered by Medicare, then that falls under consolidated billing. However, if the SNF is not billed but rather the physician bills Medicare for a service provided, that does not fall under consolidated billing.

Some services provided in a SNF are costly or require specialization and are excluded from consolidated billing. The Centers for Medicare and Medicaid Services (CMS) lists the following services that are excluded from SNF consolidated billing and are separately payable services for Medicare beneficiaries in a covered Part A stay:

Elderly lady receiving support in a SNF.
Services included in SNF consolidated billing can include chemotherapy drugs.
  • Physician assistants under a physician’s supervision
  • Nurse practitioners and clinical specialists working with a physician
  • Certified nurse-midwives
  • Psychologists
  • Certified registered nurse anesthetists
  • Home care related to a terminal condition
  • Certain dialysis-related services, including covered ambulance transportation to obtain dialysis services
  • Certain ambulance services
  • Erythropoietin for certain dialysis patients
  • Certain chemotherapy drugs
  • Certain chemotherapy administration services
  • Radioisotope services 
  • Customized prosthetic services

It is worth mentioning that not all chemotherapy drugs and administration services are excluded by the Centers for Medicare and Medicaid Services (CMS). Drugs and services not specified remain part of skilled nursing facility consolidated billing. Providers should annually check the updates on the CMS website for verification on the drugs and services that can be billed separately.

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Consolidated Billing SNF

The discussion about consolidated billing SNF above may have not answered the question: What is consolidated billing? According to Zoho, consolidated billing is a method of combining multiple payments or subscriptions of a customer into a single invoice. Hence, skilled nursing facility consolidated billing involves combining all the costs of services of a resident into one invoice.

For SNFs looking for a consolidated billing tool, CGS offers a tool to supplement long term care EHR. By entering a valid HCPCS code, nurses and administrators can:

  • Get details on whether or not the HCPCS is included in skilled nursing facility consolidated billing during a Medicare Part A stay
  • Determine if the item is payable once Part A stay has ended in a skilled nursing facility
  • Determine if the HCPCS is included in home health consolidated billing
  • Determine if the HCPCS is separately payable for hospice

If a nurse or administrator needs to verify whether a resident is approved for a Medicare Part A SNF stay, they can confirm with Medicare or visit their SNF page.

The Impact of Skilled Nursing Facility Consolidated Billing

Thanks to the Balanced Budget Act, SNFs can no longer “unbundle” services in skilled nursing facility consolidated billing. Outside suppliers must now look to nursing facilities or the SNF for payment instead of Medicare Part B. The positive effects of skilled nursing facility consolidated billing in long term care include:

Administrator disposing of a piece of paper
Consolidated billing SNF is now more efficient than ever with EHRs.
  • All services by a single facility are bundled in a form that the Prospective Payment System (PPS) is intended to capture
  • Residents covered by Part A no longer incur out of pocket liabilities
  • Duplicate billings for the same services provided to residents are eliminated
  • SNFs can oversee and coordinate resident care, leading to better outcomes

On a final note, ASCO notes that a SNF has a responsibility in using its long term care software to furnish directly or make arrangements with outside suppliers for all services that are subject to skilled nursing facility consolidated billing.

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Elijah Oling Wanga