CMS Pub. 100-04, ch. 1, § 40.4.1

Termination, Expiration, or Cancellation of Provider Agreement, or

After a SNF is Denied Payment for New Admissions

(Rev. 1, 10-01-03)

A3-3600.3

See §40.4 for provisions for payment following a termination or expiration of a provider

agreement. A SNF may be denied payment for new admissions, but not readmissions, as

an option to termination of its provider agreement for noncompliance with one or more

requirements of participation. The SNF may only be reimbursed for covered services

furnished on or after the effective date of denial of payments if such services were

furnished to beneficiaries who were admitted to the SNF before the effective date of

termination or expiration.

EXAMPLE:

Effective date of denial of payment - 9-30

Beneficiary admitted before 9-30 - pay for covered Part A or B services

Beneficiary admitted on or after 9-30 - deny payment under Part A or B

NOTE: An inpatient who goes on leave from the SNF before or after the effective date of

denial of payments for new admissions is not considered a new admission when returning

from leave.

The contractor is notified of SNF payment denials through the Form CMS-2007. It must

install appropriate edits or other safeguards to prevent incorrect payments to the provider.

The contractor obtains a list of Medicare inpatients when a SNF or hospital agreement is

terminated, or after a SNF is denied payment for new admissions to assure that

nonpayment spell of illness bills are filed.