OIG- Billing Practices in Skilled Nursing Facilities

  • Date 06.23.2011
  • Categories News

OIG- Billing Practices in Skilled Nursing Facilities

A summary and suggestions regarding the Office of Inspector General's Report on billing practices in Skilled Nursing Facilities

In December, 2010, the OIG issued a report on Medicare Part A services provided in the SNF setting. This summary addresses the findings along with suggestions. 

In the recent past the OIG has found a number of issues with SNF billing for Part A services. One such report analyzing claims from 2006-2008, found that 26% of claims submitted were not supported by the medical records resulting in over $500 million in potential overpayments. Along with these findings, the Medicare Payment Advisory Commission indicated that SNFs may be improperly billing for therapy in order to obtain additional Medicare payments.


  • SNFs were increasingly billing for higher paying RUGs, even though the beneficiary characteristics remained almost the same.
  • For-profit SNFs were more likely to bill higher paying RUGs than nonprofit and government SNFs.
  • Some  SNFs had questionable billing in 2008, frequently billing for higher RUGs and having longer length of stays (LOS) than other SNFs.

OIG Conclusions

These findings raised concerns about the potentially inappropriate use of higher paying RUGs, especially the Ultra High category and deduced that the payment system offered incentives to place beneficiaries into these categories when that level of care was not needed. The report acknowledged that a new payment system was being introduced but felt that more needed to questionable billing practices.


If you are not sure if you are up to date with the Medicare guidelines and documentation standards or whether your SNF would pass a RAC Audit or other OIG or CMS review, then consider looking for related regulations, guidelines, MDS analysis on LTC Provider University's website.

Click here for a copy of the Full Report


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