CMS Clarifies Rehab Services in Jimmo vs. Sebelius

February 2014

The Medicare Learning Network issued MLN Matters Number MM8458 (revision) and changed the way we need to think about providing therapy services in Skilled Nursing Facility (SNF), Inpatient Rehabilitation Facility (IRF), Home Health (HH) and Outpatient (OPT) settings. The change, or as the Centers for Medicare and Medicaid Services (CMS) call it, a “clarification,” was issued January 14, 2014 but effective earlier that month on the 7th.

In the Jimmo vs. Sebelius case, arguments were presented regarding “restorative,” “rehabilitative” and “maintenance” therapies as they relate to patients that seemingly were not responsive to such treatments. Questions were asked such as: Who is eligible to receive these types of services? In what settings, if any, can you provide these types of services? Should an “improvement standard” concept be measured in the treatment of residents in their response to these therapy services? Is the restoration potential of a resident the determining factor in deciding whether to prescribe this plan of care?

At issue was the question of whether certain therapy benefits should be extended and deemed eligible/billable to residents that may not be “responsive” to the treatment.

The case and questions were complex and the arguments on both sides of the bar were strong. The prevailing decision came down on the side of the patient, in most instances. Based upon the settlement of the case CMS has agreed to revise, or clarify, program manuals used by Medicare contractors in order to simplify the meaning of the coverage of skilled nursing and skilled therapy services. In essence, CMS has agreed to revise program language to state that providing these types of services “…do not turn on the presence or absence of a beneficiary’s potential for improvement, but rather on the beneficiary’s need for skilled care.”

This was a big departure from previous thinking whereby, in most cases, the potential for improvement was a driving force in whether the beneficiary was entitled to these types of services.

In light of this decision, CMS will be updating portions of the Medicare Benefits Manual to clarify key components of SNF, IRF, HH and OPT coverage requirements pursuant to the settlement agreement in this case. In reaching this agreement it is important to point out again that this is a clarification of existing regulation and this does not constitute a modification, contraction or expansion of existing eligibility standing.

The revision is significant in that it departs from a prior practice whereby if a resident is not responding to skilled nursing or therapy services, the “improvement standard” would suggest that the patient is no longer eligible for those treatments because they are not “improving” or getting better.  This thinking no longer applies.

CMS now says, “The restorative potential of a patient is not the deciding factor in determining whether skilled services are needed. Even if full recovery or medical improvement is not possible, a patient may need skilled services to prevent further deterioration or preserve current capabilities.” Further, the federal agency also seeks to clarify that the concept of skilled therapy services can similarly involve restorative as well as maintenance treatments, if certain standards are met.

Restorative / Rehabilitative Therapy

When evaluating claims for skilled therapy that is restorative or rehabilitative in nature that has a goal to reverse, either in whole or in part, a previous lost function, it would be appropriate to consider a patient’s potential for improvement. These considerations typically take place in the IRF setting. Given the aforementioned goal, the services that are prescribed must be “reasonably expected to improve the patient’s functional capacity or adaptation to impairments in order to be covered.”

Maintenance Therapy

And further, when no improvement is expected under SNF, HH or OPT coverage standards, skilled therapy services would be covered when an “individualized assessment of a patient’s condition demonstrates that skilled care is necessary for a safe and effective maintenance program designed to maintain current condition or prevent further deterioration.” The revision will state that maintenance therapy is covered “when the particular patient’s special medical complications or the complexity of the therapy procedures require the skilled care” based upon an individualized care assessment.

In Jimmo vs. Sebelius, no longer can a beneficiary’s lack of restorative potential be the sole reason for denying coverage in this context. An exception to this clarification is that if the service can be provided by “non-skilled” personnel, then coverage would be an issue as the case applies to skilled, rather than non-skilled, nursing and therapy services.

In the wake of the tenants of health care reform as we have come to know, perhaps CMS is thinking differently. Public health best protocols would tell us that it is better, in most cases, to receive this type of care rather than not be provided these services and suffer, deteriorate and eventually be placed in a higher cost setting. The Affordable Care Act, among other things, addresses treating patients in the most appropriate setting, by the most appropriate personnel, to achieve the most successful outcome. The settlement agreement now seems to take those positions into account.

In the CMS consent to clarify this thinking, the provider still assumes a considerable amount of risk in providing these types of services. Providers must be certain that there is an individualized patient assessment supporting the need for this treatment, the service must be reasonable and medically necessary and the therapy must be provided in a safe and effective manner that will maintain and prevent a decline in condition. That said, documentation is paramount in avoiding take backs from CMS who will be watching and auditing these services for some time.

Part B is also considered in this clarification. In Chapter 15 Section 220 of the Medicare Benefits Manual CMS discusses rehabilitative and restorative therapy in Part B, OPT, settings. “Rehabilitative therapy includes services designed to address recovery or improvement in function and, when possible, restoration to a previous level of well-being. A Maintenance Program means a program established by a therapist that consists of activities and/or mechanism that will assist a beneficiary in maximizing or maintaining the progress he or she has made during therapy or to prevent or slow further deterioration due to a disease or illness, with no mention of improving the patient’s condition noted.”

For more information on Jimmo vs. Sebelius and how it may impact your operations refer to MLN Matters Number MM8458 or contact your BNN advisor at1.800.244.7444.

Disclaimer of Liability: This publication is intended to provide general information to our clients and friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.