100-08 Medicare Program Integrity Manual: Chapter 6 - Medicare Contractor Medical Review Guidelines for Specific Services

Medicare Program Integrity Manual
Chapter 6 - Medicare Contractor Medical Review
Guidelines for Specific Services
Table of Contents
(Rev. 13409, 09-12-25)
Transmittals for Chapter 6
6.1 - Medical Review of Skilled Nursing Facility Prospective Payment System (SNF
PPS) Claims
6.1.1 - Skilled Nursing Facility Qualifying Inpatient Stay
6.1.2 - Types of SNF PPS Review
6.1.3 - Claim Review Requirements
6.1.4 - Medical Review Process
6.1.5 - Workload
6.2 – Medical Review of Home Health Services
6.2.1 - Physician Certification of Patient Eligibility for the Medicare Home Health
Benefit
6.2.1.1 - Certification Requirements
6.2.2 - Physician Recertification
6.2.2.1 - Recertification Elements
6.2.3 - The Use of the Patient’s Medical Record Documentation to Support the
Home Health Certification
6.2.4 - Coding
6.2.5 - Medical Necessity of Services Provided
6.2.6 - Examples of Sufficient Documentation Incorporated Into a Physician’s
Medical Record
6.2.7 - Medical Review of Home Health Demand Bills
6.3 – Medical Review of Certification and Recertification of Residents in SNFs
6.4 – Medical Review of Rural Air Ambulance Services
6.4.1 – “Reasonable” Requests
6.4.2 – Emergency Medical Services (EMS) Protocols
6.4.3 – Prohibited Air Ambulance Relationships
6.4.4 – Reasonable and Necessary Services
6.4.5 – Definition of Rural Air Ambulance Services
6.5 – Medical Review of Inpatient Hospital Claims for Part A Payment
6.5.1 - (Reserved for future use)
6.5.2 – Conducting Patient Status Reviews of Claims for Medicare Part A
Payment for Inpatient Hospital Admissions

6.5.3 – DRG Validation Review
6.5.4 – Review of Procedures Affecting the DRG
6.5.5 – Special Review Considerations
6.5.6 – Length-of-Stay Review
6.5.7 – Reserved for Future Use
6.5.8 – Reserved for Future Use
6.5.9 – Circumvention of PPS
6.6 - Referrals to the Quality Improvement Organization (QIO)
6.7 - Medical Review of Inpatient Rehabilitation Facility (IRF) Services
6.7.1 – Reviewing for Intensive Level of Rehabilitation Therapy Services
Requirements
6.8 - Medical Review of Evaluation and Management (E/M) Documentation
6.8.1 – Medical Review of E/M Documentation Provided by Student
6.9 – Medical Review of Diagnostic Tests
6.9.1 – Medical Review of Diagnostic Laboratory Tests

6.1 – Medical Review of Skilled Nursing Facility Prospective Payment
System (SNF PPS) Claims
(Rev. 924; Issued: 11-15-19; Effective: 10-01-19; Implementation: 12-17-19)
In 1998, Medicare began paying skilled nursing facilities (SNFs) under a Prospective
Payment System (PPS). PPS payments are per diem rates based on the patient’s
condition and determined through a CMS prescribed case-mix model and payment
classification system. This classification is done by the use of a clinical assessment tool,
the Minimum Data Set (MDS), and is required to be performed periodically according
to an established schedule for purposes of Medicare payment. Each MDS represents the
patient’s clinical status based on an Assessment Reference Date (ARD) and established
look-back periods for the covered days associated with that MDS. Medicare expects to
pay at the rate based on the most recent clinical assessment (i.e., MDS), for all covered
days associated with that MDS. Medical review decisions are based on documentation
provided to support the coding and medical necessity of services recorded on the MDS
for the claim period billed. Medicare contractors focus on the unique, individualized
needs, characteristics and goals of each patient, in conjunction with CMS payment
policies, to determine the appropriateness of the case-mix classifier billed.
All Medicare contractors are to review, in accordance with their medical review
strategies, SNF PPS services covered by the consolidated billing policy. SNF services
excluded from consolidated billing are identified in §4432(a) of the BBA and regular
updates which can be accessed by contractors at:
http://www.cms.gov/Medicare/Billing/SNFConsolidatedBilling/index.html.
“Rules of thumb” in the Medical Review (MR) process are prohibited. Medicare
contractors must not make denial decisions solely on the reviewer’s general inferences
about beneficiaries with similar diagnoses or on general data related to utilization. Any
"rules of thumb" that would declare a claim not covered solely on the basis of elements,
including but not limited to, lack of restoration potential, ability to walk a certain
number of feet, or degree of stability, is unacceptable without individual review of all
pertinent facts to determine if coverage may be justified. Medical denial decisions must
be based on a detailed and thorough analysis of the beneficiary’s total condition and
individual need for care.
The goal of medical review is to determine whether the services are reasonable and
necessary, delivered in the appropriate setting, and coded correctly, based on appropriate
documentation. Under PPS, beneficiaries must continue to meet the regular eligibility
requirements for a SNF stay as described in Pub. 100-02, Medicare Benefit Policy
Manual, chapter 8, §§20ff, such as the 3-day medically necessary hospital stay and
admission to a participating SNF within a specified time period (generally 30 days) after
discharge from the hospital.

6.1.1 - Skilled Nursing Facility Qualifying Inpatient Stay
(Rev. 924; Issued: 11-15-19; Effective: 10-01-19; Implementation: 12-17-19)
Under the SNF PPS, beneficiaries who are admitted (or readmitted) directly to a SNF
after a qualifying hospital stay are presumed to meet the level of care requirements of
42 CFR 409.31 up to and including the assessment reference date (ARD) for the initial
Medicare assessment (commonly referred to as the “5-day” assessment) prescribed in
42 CFR 413.343(b), when correctly assigned to one of the more intensive case-mix
classifiers that is designated (in the annual publication of Federal prospective payment
rates described in 42 CFR 413.345) as representing the required level of care. If the
beneficiary is not admitted (or readmitted) directly to a SNF after a qualifying hospital
stay, the administrative level of care presumption does not apply. For a further
explanation of the administrative presumption of coverage, please refer to §6.1.4 of
this chapter, and to Pub. 100-02, Medicare Benefit Policy Manual, chapter 8, §30.1
(including item 3 of that section for a discussion of a rehospitalization that exceeds the
3-day interruption window specified under the SNF PPS’s interrupted stay policy).
Medicare contractors shall:
• 	Use the Common Working File (CWF) to validate the presence of an inpatient
hospital claim that was paid by Medicare. Because the entire medical record
from the inpatient hospital stay is not received for a SNF claim, it is difficult to
determine if the medical record and the CWF conflict. Therefore, it is assumed
that the dates of service for the inpatient hospital claim in CWF are correct for
purposes of establishing the 3-day prior inpatient hospital claim dates. If the
CWF is silent as to an associated 3-day inpatient hospital claim, confirm that
the beneficiary had a 3-day inpatient hospitalization outside the Medicare
system (for example, the Veteran’s Administration hospital system). If such is
the case, the medical record from the inpatient hospitalization can be used to establish
inpatient hospitalization dates. This documentation need not be signed for this
purpose.
• 	Presume medical necessity of the qualifying inpatient hospitalization. If,
during the normal claims review process, evidence that the hospitalization
may not have been medically necessary emerges, the Medicare contractors
shall fully develop the case in accordance with the directions contained in
Pub. 100-02, chapter 8, § 20 and 20.1.
• 	Verify that the extended care services were for an ongoing condition that was
also present during the prior hospital stay (even if not the main reason for that
stay), or for a new condition that arose while the beneficiary was receiving
treatment in the SNF for the ongoing condition. In this context, the ongoing
condition need not have been the principal diagnosis that actually precipitated
the beneficiary’s admission to the hospital, but could be any one of the
conditions present during the qualifying hospital stay. The Medicare
contractors may use a hospital discharge summary or any additional

documentation from the inpatient hospital to make this verification. This
documentation need not be signed for this purpose.
6.1.2 - Types of SNF PPS Review
(Rev. 924; Issued: 11-15-19; Effective: 10-01-19; Implementation: 12-17-19)
A. Targeted Probe and Educate Medical Review
Medicare Administrative Contractors (MACs) shall follow the instructions described in
Chapter 3 of 	Pub. 100-08, the Medicare Program Integrity Manual, when conducting
medical review.
B. Demand Bills
MACs must conduct MR of all patient-generated demand bills with the following
exception:
Demand bills for services to beneficiaries who are not entitled to Medicare or do
not meet eligibility requirements for payment of SNF benefits (i.e., no qualifying
hospital stay) do not require MR. A denial notice with the appropriate reasons
for denial must be sent.
Demand bills are bills submitted by the SNF at the beneficiary’s request because the
beneficiary disputes the provider’s opinion that the bill will not be paid by Medicare and
requests that the bill be submitted for a payment determination. The demand bill is
identified by the presence of a condition code 20. The SNF must have the proper
liability notice consistent with Section 1879 of the Social Security Act signed by the
beneficiary unless the beneficiary is deceased or incapable of signing. In this case, the
beneficiary’s guardian, relative, or other authorized representative may make the request
(see 42 CFR 424.36, Signature requirements). In the case where all covered services are
being terminated, the SNF provider is also required to have issued an expedited
determinations notice, as detailed in Pub. 100-04, Medicare Claims Processing Manual,
chapter 30, section 260, and on the CMS website at
https://www.cms.gov/Medicare/Medicare-General-Information/BNI/FFS-Expedited-
Determination-Notices.html.
When determining eligibility for Medicare coverage, the MAC shall review the demand
bill and the medical record to determine that both technical and clinical criteria are met. If
all technical and clinical criteria are met, and the reviewer determines that some or all
services provided were reasonable and necessary, use the MDS QC System Software, as
necessary, to determine the appropriate case-mix classifier. Further instruction on the use
of this software for adjustment of SNF claims is found in section 6.1.3 below. If the
reviewer determines that no services provided were medically necessary, the MAC shall
deny the claim in full.
The Health Insurance Prospective Payment System (HIPPS) code and revenue code

0022 must be present on the demand bill. There may be cases where the MAC receives
a demand bill for which no associated MDS (or other required Medicare assessment)
was transmitted to the repository because the provider did not feel that the services
were appropriate for Medicare payment. In these cases, if the Medicare contractor
determines that coverage criteria are met (see § 6.1.4 B.), and medically necessary
skilled services were provided, the Medicare contractor shall pay the claim at the
default rate for the period of covered care for which there is no associated MDS in the
repository.
C. Claims Submitted for Medicare Denial Notices
Providers may submit claims for a denial from Medicare for Medicaid or another insurer
that requires a Medicare denial notice. These claims are identified by condition code 21.
The SNF is required to issue a notice of noncoverage to the beneficiary that includes the
specific reasons the services were determined to be noncovered. A copy of this notice
must be maintained on file by the SNF in case the Medicare contractor requests a copy
of the notice. See Pub. 100-04, Medicare Claims Processing Manual, chapter 1, §60.1.3
for further details.
6.1.3 - Bill Review Requirements
(Rev. 924; Issued: 11-15-19; Effective: 10-01-19; Implementation: 12-17-19)
Medicare contractors must conduct review of SNF PPS claims in accordance with
these instructions and all applicable Pub. 100-08, Medicare Program Integrity Manual
sections, including but not limited to, Medicare contractor standard operating
procedures for soliciting additional documentation, time limitations for receipt of the
solicited documentation, claim adjudication, and recoupment of overpayment.
Minimum requirements of a valid SNF PPS claim are:
• 	Revenue Code 0022 must be on the claim. This is the code that designates
SNF PPS billing.
• 	A HIPPS code must also be on the claim. This is a five-character code. The first
character represents the patient’s physical therapy (PT) component and
occupational therapy (OT) component classification. The second character
represents the patient’s speech-language pathology (SLP) component
classification. The third character represents the patient’s nursing component
classification. The fourth character represents the patient’s non-therapy ancillary
(NTA) component classification. The fifth character represents the assessment
indicator (AI) code. See Pub. 100-04, chapter 6, §30.1 for valid codes and
assessment indicators.
6.1.4 - Medical Review Process
(Rev. 924, Issued: 11-15-19; Effective: 10-01-19; Implementation: 12-17-19)
A. Obtain Medical Records and MDS

Medicare contractors shall obtain documentation necessary to make a MR
determination. Medical records must be requested from the provider and the MDS data
must be obtained from the national repository. Medicare contractors are to use the
MDS as part of the medical documentation used to determine whether the HIPPS codes
billed were accurate and appropriate. Medicare contractors shall use the QIES (Quality
Improvement & Evaluation System) Business Intelligence Center (QBIC) Fiscal
Intermediary (FI) Extract Reports to obtain the MDS data from the National Reporting
repository.
Additional information about the use of the FI Extract Reports can be found in the
QBIC User's Guide.
Information (QBIC documentation & training) can be found at https://qtso.cms.gov.
(Search for ‘QBIC’ when accessing the webpage.) Once the clinical reviewer has
utilized the FI Extract Reports to obtain the MDS(es) corresponding to the period being
reviewed, the reviewer will import the MDS data into the MDS QC Software System
to convert it into a readable format to be used, in conjunction with review of the
medical record, for the adjustment of the SNF claim.
Once the clinical reviewer has used the FI Extract Tool to obtain the MDS
corresponding to the period being reviewed, the reviewer will import the MDS QC
Software System to convert it into a readable format to be used, in conjunction with
review of the medical record for the adjustment of the SNF claim. The MDS QC
System Software and Reference Manual can be requested at
MDSQC@nerdvana.fu.com. The MDS QC Tool contractor will contact CMS for
approval of the request prior to sending out the MDS QC System Software and
Reference Manual by FedEx.
Medicare contractors shall also request documentation to support the HIPPS code(s)
billed, including notes related to the ARD, documentation relating to the look-back
periods which may fall outside the billing period under review, and documentation
related to the claim period billed. Since the ARD for each MDS marks the end of the
look-back period (which may extend back 30 days), the Medicare contractor must be
sure to obtain supporting documentation for up to 30 days prior to the ARD if
applicable. The requested documentation may include hospital discharge summaries
and transfer forms; physician orders and progress notes; patient care plans; nursing and
rehabilitation therapy notes; and treatment and flow charts and vital sign records,
weight charts and medication records.
Clinical documentation that supports medical necessity may be expected to include:
physician orders for care and treatments, medical diagnoses, rehabilitation diagnosis
(as appropriate), past medical history, progress notes that describe the beneficiary’s
response to treatments and his/her physical/mental status, lab and other test results, and
other documentation supporting the beneficiary’s need for the skilled services being
provided in the SNF.

During the review process, if the provider fails to respond to a Medicare contractor’s
Additional Documentation Request (ADR) within the prescribed time frame, the
Medicare contractor shall deny the claim. See Pub. 100-08, Medicare Program
Integrity Manual, chapter 3, section 3.2.3.8 for information on denials based on non-
response to
ADRs and section 3.2.3.9 for handling of late documentation. If the provider furnishes
documentation that is incomplete/insufficient to support medical necessity, adjust the
bill in accordance with §1862(a)(1)(A) of the Act.
B. Make a Coverage Determination
For all selected claims, the Medicare contractor shall review medical
documentation and determine whether the following criteria are met, in order to
make a payment determination:
• 	The services must not be statutorily excluded--Determine whether the services
are excluded from coverage under any provision in §1862(a) of the Act other
than
§1862(a)(1)(A).
• 	MDS must have been transmitted to the state repository - The Medicare
contractor shall require that the provider submit the claim with the case-mix
classifiers obtained from the “Grouper” software, as instructed in Pub. 100-04,
Medicare Claims Processing Manual, chapter 6, § 30.1. Claims for which
MDSs have not been transmitted to the repository should therefore not be
submitted to Medicare for payment, and shall be denied. An exception to that
instruction occurs in the case where the beneficiary is discharged or dies on or
before day 8 of the SNF admission or readmission, as described in Chapter 2 of
the MDS 3.0 RAI manual. In that specific case, Medicare contractors shall pay
claims at the default rate, provided that level of care criteria were met and
skilled services were provided and were reasonable and necessary. In all other
cases, the Medicare contractor shall deny any claim for which the associated
MDS is not in the repository.
• 	SNF must have complied with the assessment schedule - In accordance with
42 CFR §413.343, in those instances when the assessment is not completed
timely, the contractor shall pay at the default rate for any days of care prior to
the assessment reference date of the required assessment.
The Interim Payment Assessment (IPA) is an optional assessment that
providers may complete to report a change in the patient’s classification. If an
IPA has been completed, medical reviewer will examine the medical
documentation as described in this section.
• 	Services are Reasonable and Necessary--Determine whether the services are
reasonable and necessary under §1862(a)(1)(A) of the Act. When making

reasonable and necessary determinations, contractors shall determine whether
the services indicated on the MDS were rendered and were reasonable and
necessary for the beneficiary’s condition as reflected by medical record
documentation. If the reviewer determines that none of the services provided
were reasonable and necessary or that none of the services billed were
supported by the medical record as having been provided, the Medicare
contractor shall deny the claim in full.
• 	Level of care requirement must be met--Determine whether the services met
the requirements according to 42 CFR §409.31.
- 	Under PPS , the beneficiary must meet level of care requirements as defined
in 42 CFR §409.31. The SNF PPS includes an administrative presumption
in which a beneficiary who is correctly assigned one of the designated case-
mix classifiers on the initial Medicare (“5-day”) PPS assessment is
presumed to meet the SNF level of care through the assessment reference
date (ARD). This effectively creates a presumption of coverage for the
period from the first day of the Medicare covered services up to, and
including, the ARD for that assessment, which must be set for no later than
the eighth day of the SNF stay. The 5-day assessment may trigger a
presumption of coverage only when the SNF admission directly follows
discharge from a prior qualifying hospital stay. See Pub. 100-02, Medicare
Benefit Policy Manual, chapter 8, §30.1 for further explanation of the
administrative presumption of coverage.
- 	In the case described above, where the administrative presumption of
coverage exists, Medicare contractors shall review the claim and supporting
medical information specifically to confirm the correctness of the case-mix
classifier assignment that triggered the presumption. To determine if the
beneficiary was correctly assigned to a case-mix classifier, Medicare
contractors shall verify that the billed case-mix classifier is supported by the
associated provider documentation. Medicare contractors shall consider all
available information in determining coverage. This includes the MDS, the
medical records including physician, nursing, and therapy documentation,
and the beneficiary’s billing history.
- 	A beneficiary who is not assigned one of the case-mix classifiers designated
as representing the required level of care on the 5-day assessment
prescribed in 42 CFR 413.343(b) IS NOT automatically classified as either
meeting or not meeting the SNF level of care definition. Instead, the
beneficiary must receive an individual level of care determination using
existing administrative criteria and procedures, so documentation must
support that these beneficiaries meet the level of care requirements.
- 	For days after the assessment reference date of the 5-day assessment,
determination of the continued need for, and receipt of, a skilled level of

care will be based on the beneficiary’s clinical status and skilled care
needs for the dates of service under review.
- 	The level of care requirement includes the requirement that the beneficiary
must require skilled nursing or skilled rehabilitation services, or both on a
daily basis. Criteria and examples of skilled nursing and rehabilitation
services, including overall management and evaluation of the care plan and
observation of a patient’s changing condition, may be found at 42 CFR
§§409.32 and 409.33.
- 	An apparent interruption in daily skilled services should not be
interpreted to signal an end to daily skilled care. Rather, consideration
should be given to the provision of observation and assessment and
management and evaluation of the care plan during the review of
medical records.
C. Review Documentation and Enter Correct Data into the MDS QC Software
When Appropriate.
If the reviewer determines that coverage criteria are met and services are not
statutorily excluded, but some services provided were not reasonable and necessary
or were not supported in the medical record as having been provided as billed, the
current MDS QC System Software must be used to calculate appropriate payment.
Medicare contractors shall pay claims according to the case-mix classifier value
calculated using the MDS QC tool, regardless of whether it is higher or lower than
the case-mix classifier billed by the provider. If none of the services provided were
reasonable and necessary, the Medicare contractor shall deny the claim in full.
Medicare contractors shall use the most current version of MDS QC System Software
to review and calculate appropriate payment for SNF claims. The medical reviewer
will examine the medical documentation to make a determination as to whether it
supports the data entered into the MDS assessment completed by the provider and
extracted from the repository. If a discrepancy is noted, the reviewer shall enter the
correct data reflected in the medical record, according to the instructions in the MDS
QC System Software Reference Manual. The reviewer shall consider all available
medical record documentation in entering data into the software. This includes
physician, nursing, and therapy documentation, and the beneficiary’s billing history.
Review of the claim form alone does not provide sufficient information to make an
accurate payment determination.
D. Outcome of Medical Record Review
The Medicare contractor shall take action to pay the claim appropriately, for the days on
which the SNF was in compliance with the assessment schedule (pay the default rate for
the days on which the SNF provided covered care, but was not in compliance with the
assessment schedule), as described in each of the following situations—

Services are Reasonable and Necessary as Documented on the MDS Submitted to the
Repository:
• 	If no discrepancies are noted between the MDS submitted to the repository and the
patient’s medical record, during the relevant assessment period for the timeframe
being billed, the Medicare contractor shall verify that the case-mix classifier
submitted on the claim matches the case-mix classifier on the MDS imported from
the repository into the MDS QC tool, and:
o 	If the facility case-mix classifier obtained through the MDS QC tool matches
the case-mix classifier submitted on the claim, the Medicare contractor shall
pay the claim as billed for all covered days associated with that MDS, even if
the level of therapy changed during the payment period.
o 	If the facility case-mix classifier obtained through the MDS QC tool DOES
NOT match the case-mix classifier submitted on the claim, the Medicare
contractor shall pay the claim at the appropriate level based on the case-mix
classifier level on the MDS submitted to the repository (and subsequently
obtained through the MDS QC tool) for all covered days associated with that
MDS, even if the services provided changed during the payment period.
Some Services are Reasonable and Necessary but Not Supported as Billed in Patient Medical
Record:
• 	If some skilled services were appropriate, but some services provided were not
reasonable and necessary or were not supported by the medical record as having been
provided as billed, and the reviewer determines (based on data entered from the
medical record into the MDS QC System Software) that:
o 	The discrepancies are such that they do not result in a change in the case-mix
classification level as calculated by the MDS QC tool, during the relevant
assessment period for the timeframe being billed, the Medicare contractor
shall accept the claim as billed for all covered days associated with that MDS,
even if the level of skilled care changed during the payment period.
o 	There is another case-mix classifier for which the beneficiary qualifies, the
Medicare contractor shall pay the claim according to the correct case-mix
classifier calculated using the MDS QC System Software for all covered days
associated with that MDS, and recoup any overpayments as necessary.
Need For Skilled Care Ends:
• 	If the reviewer determines that the beneficiary falls to a non-skilled level of care at
some point during the period under review, the Medicare contractor shall deny the
claim from the date on which the beneficiary no longer meets level of care criteria.

General Information for All HIPPS Codes
- 	No Skilled Care Needed or Provided--If the reviewer determines that none
of the services furnished were reasonable and necessary and that no skilled
care is needed or provided, the Medicare contractor shall deny the claim
from the date that skilled care ended.
- 	Services Billed But Not Furnished--If the reviewer determines that any of
the services billed were not furnished, deny the claim in part or full and, if
applicable, the Medicare contractor shall apply the fraud and abuse
guidelines in Pub 100-08, Medicare Program Integrity Manual, chapter 4.
A partial denial is defined as either the disallowance of specific days within the stay
or reclassification into a lower case-mix classifier.
For any full or partial denials made, adjust the claim accordingly to recoup the
overpayment. A partial denial based on classification into a new case-mix
classification code or a full denial because the level of care requirement was not met
are considered reasonable and necessary denials (§1862(a)(1)(A)) and are subject to
appeal rights.
It is important to recognize the possibility that the necessity of some services could be
questioned and yet not impact the case-mix classification. The case-mix classification
may not change because there are many clinical conditions and treatment regimens that
qualify the beneficiary for the case-mix classifier to which he or she was assigned.
When reviewing bills, if the reviewer suspects fraudulent behavior, e.g., a pattern of
intentional reporting of inaccurate information for the purpose of payment or the
billing for services which were not furnished or quality of care concerns, it is the
Medicare contractor’s responsibility to refer the provider to the appropriate entity for
further investigation.
6.1.5 - Workload
(Rev. 721; Issued: 06-09-17; Effective: 07-11-17; Implementation: 07-11-17)
All Medicare contractors must review some level of SNF PPS bills based on data
analysis. These are medical record reviews and should be reviewed by professionals, i.e.,
at a minimum, by LPNs. Workload projections are to be addressed through the annual
Budget Performance Requirements process.
6.2 - Medical Review of Home Health Services
(Rev. 10184; Issued: 06-19-2020; Effective: 07-21-2020; Implementation: 07-21-
2020)
This section applies to Unified Program Integrity Contractors (UPIC), Medicare
Administrative Contractors (MAC), Supplemental Medical Review Contractor (SMRC),

Recovery Audit Contractors (RAC) and the Comprehensive Error Rate Testing (CERT)
contractor.
6.2.1 - Physician Certification of Patient Eligibility for the Medicare
Home Health Benefit
(Rev.603, Issued: 07-21-15, Effective: 08-11-15, Implementation: 08-11-15)
A physician certification/recertification of patient eligibility for the Medicare home
health benefit is a condition for Medicare payment per sections 1814(a) and 1835(a) of
the Social Security Act (the “Act”). The regulations at 42 CFR 424.22 list the
requirements for eligibility certification and recertification. The requirements differ for
eligibility certification and recertification; however, if the requirements for certification
are not met, then claims for subsequent episodes of care, which require a recertification,
will be non-covered—even if the requirements for recertification are met.
Home health agencies (HHAs) should obtain as much documentation from the certifying
physician’s medical records and/or the acute/post-acute care facility’s medical records (if
the patient was directly admitted to home health) as they deem necessary to assure
themselves that the Medicare home health patient eligibility criteria for certification and
recertification have been met and must be able to provide it to CMS and its review
entities upon request. Per the regulations at 42 CFR 424.22(c), if the documentation used
as the basis for the certification of eligibility is not sufficient to demonstrate that the
patient is or was eligible to receive services under the Medicare home health benefit,
payment will not be rendered for home health services provided.
Therefore, for all medical necessity reviews, the Medicare review contractors shall
review the certification documentation for any episode initiated with the completion of a
start-of-care Outcome and Assessment Information Set (OASIS) assessment. This means
that if the subject claim is for a subsequent episode of care, the HHA must submit all
certification documentation as well as recertification documentation. The review
contractor shall send a documentation request to the billing HHA requesting the
supporting documentation from the certifying physician and/or the acute/post-acute care
facility if the patient was directly admitted to home health from such setting (as defined
in 42 CFR 424.22) that substantiates the patient’s eligibility for the Medicare home health
benefit.
For medical review purposes, the referring /certifying physician’s initial order for home
health services for a patient initiates the establishment of a plan of care as part of the
certification of patient eligibility for the Medicare home health benefit. The physician’s
initial order must specify the medical treatment(s) to be furnished and does not eliminate
the need for the plan of care as required in 42 CFR 409.43.
If the review contractor finds that the documentation in the certifying physician’s medical
record for that patient used as the basis for the certification of eligibility, which includes
subsequent supporting documentation from the HHA (if incorporated into the certifying
physician’s or acute/post-acute care facility’s medical record for that patient), is

insufficient to demonstrate the patient is or was eligible to receive services under the
Medicare home health benefit, the review contractor shall deny payment (in the case of
prepayment review) or shall initiate an overpayment demand letter (in the case of post
payment review).
The review contractor shall only consider a plan of care and the certification or
recertification for home health services from physicians who do not have a financial
relationship with the HHA. The review contractor shall only consider documentation of
the face-to-face encounter from physicians or allowed non-physician practitioners, as
defined in 42 CFR 424.22, who do not have a financial relationship with the HHA (see
6.2.3).
CMS does not require a specific form or format for the certification as long as a physician
certifies that the five certification requirements, outlined in 42 CFR 424.22(a)(1) and
section 6.2.1.1, are met.
6.2.1.1 – Certification Requirements
(Rev. 704, Issued: 03-17-17, Effective: 04-17-17, Implementation: 04-17-17)
When conducting a medical necessity review, the review contractor shall determine whether
the supporting documentation addresses each of the following criteria for which a physician
certified (attested to):
1. 	Homebound. Home health services are or were required because the individual is or
was confined to the home per the criteria below (as defined in sections 1835(a) and
1814(a) of the Social Security Act).
a. 	Criteria-One:
The patient must--
- 	Because of illness or injury, need the aid of supportive devices such as
crutches, canes, wheelchairs, and walkers; the use of special transportation; or the
assistance of another person in order to leave their place of residence
OR
- 	Have a condition such that leaving his or her home is medically
contraindicated.
If the patient meets one of the Criteria-One conditions, then the patient must ALSO
meet two additional requirements defined in Criteria-Two below.
b. 	Criteria-Two:
- 	There must exist a normal inability to leave home;
AND

- 	Leaving home must require a considerable and taxing effort.
In determining whether the patient meets criterion two of the homebound definition,
the clinician needs to take into account the illness or injury for which the patient met
criterion one and consider the illness or injury in the context of the patient’s overall
condition. The clinician is not required to include standardized phrases reflecting the
patient’s condition (e.g., repeating the words “taxing effort to leave the home”) in the
patient’s chart, nor are such phrases sufficient, by themselves, to demonstrate that
criterion two has been met. For example, longitudinal clinical information about the
patient’s health status is typically needed to sufficiently demonstrate a normal
inability to leave the home and that leaving home requires a considerable and taxing
effort. Such clinical information about the patient’s overall health status may include,
but is not limited to, such factors as the patient’s diagnosis, duration of the patient’s
condition, clinical course (worsening or improvement), prognosis, nature and extent
of functional limitations, other therapeutic interventions and results, etc.
2. 	Skilled Care. The patient needs or needed intermittent skilled nursing care
(other than solely venipuncture for the purposes of obtaining a blood sample),
physical therapy, and/or speech language pathology services as defined in 42
CFR 409.42(c).
NOTE: Where a patient’s sole skilled service need is for skilled oversight of
unskilled services (management and evaluation of the care plan as defined in
42 CFR 409.42(c)), the physician must include a brief narrative describing the
clinical justification of this need as part of the certification, or as a signed
addendum to the certification. The physician must sign immediately following
the narrative.
3. 	Plan of Care. A plan for furnishing the services has been established and is, or
will be, periodically reviewed by a physician who is a doctor of medicine,
osteopathy, or podiatric medicine (a doctor of podiatric medicine may perform
only plan of treatment functions that are consistent with the functions he or she
is authorized to perform under state law). If the physician’s orders for home
health services meet the requirements specified in 42 CFR 409.43 Plan of Care
Requirements, this meets the requirement for establishing a plan of care as part
of the certification of patient eligibility for the Medicare home health benefit.
4. 	Under Physician Care. Home health services will be or were furnished while
the individual is or was under the care of a physician who is a doctor of
medicine, osteopathy, or podiatric medicine.
5. 	Face-to-Face Encounter. A face-to-face patient encounter occurred no more
than 90 days prior to the home health start of care date or within 30 days after
the start of the home health care, was related to the primary reason the patient
requires home health services, and was performed by an allowed provider type

defined in 42 CFR 424.22(a)(1)(v). The certifying physician must also
document the date of the encounter as part of the certification.
While the face-to-face encounter must be related to the primary reason for
home health services, the patient’s skilled need and homebound status can be
substantiated through an examination of all submitted medical record
documentation from the certifying physician, acute/post-acute care facility,
and/or HHA (see below). The synthesis of progress notes, diagnostic findings,
medications, nursing notes, etc., help to create a longitudinal clinical picture of
the patient’s health status.
6.2.2 – Physician Recertification
(Rev. 603, Issued: 07-21-15, Effective: 08-11-15, Implementation: 08-11-15)
At the end of the 60-day episode, a decision must be made whether or not to recertify the
patient for a subsequent 60-day episode. The plan of care must be reviewed and signed
by the physician at least every 60 days when there is a need for continuous home care
unless the beneficiary transfers to another HHA or the beneficiary is discharged and
subsequently re-admitted (these situations trigger a new certification, rather than a
recertification).
6.2.2.1 – Recertification Elements
(Rev. 870, Issued: 03-22-19, Effective: 04-22-19, Implementation: 04-22-19)
Recertification is required at least every 60 days when there is a need for continuous
home health care after an initial 60-day episode. Recertification should occur at the time
the plan of care is reviewed, and must be signed and dated by the physician who reviews
the plan of care. Recertification is required at least every 60 days unless there is a—
(i) Beneficiary elected transfer; or
(ii) Discharge with goals met and/or no expectation of a return to home health
care.
Medicare does not limit the number of continuous episode recertifications for
beneficiaries who continue to be eligible for the home health benefit. The physician
certification may cover a period less than but not greater than 60 days. Because the
updated home health plan of care must include the frequency and duration of visits to be
made, the physician does not have to estimate how much longer skilled services will be
needed for the recertification.
The recertification statement must indicate the continuing need for services. Need for
occupational therapy may be the basis for continuing services that were initiated because
the individual needed skilled nursing care or physical therapy or speech therapy. In this
case reviewers will look for documentation substantiating the need for continued

occupational therapy when the needed skilled nursing care or physical therapy or speech
therapy that were initially needed, are no longer needed.
If a patient’s underlying condition or complication requires a registered nurse to ensure
that essential non-skilled care is achieving its purpose, and necessitates a registered nurse
be involved in the development, management, and evaluation of a patient’s care plan, the
reviewer will look for the physician’s brief narrative describing the clinical justification
of this need. If the narrative is part of the recertification form, then the narrative must be
located immediately prior to the physician’s signature. If the narrative exists as an
addendum to the recertification form, in addition to the physician’s signature on the
recertification form, the physician must sign immediately following the narrative in the
addendum.
As mentioned earlier in this section, the reviewer will confirm that all elements of the
certification are included in the documentation sent for the recertification claim review.
If the submitted certification documentation (submitted with the recertification
documentation) does not support home health eligibility, the claim associated with the
recertification period will not be paid.
6.2.3 – The Use of the Patient’s Medical Record Documentation to
Support the Home Health Certification
(Rev. 704, Issued: 03-17-17, Effective: 04-17-17, Implementation: 04-17-17)
As mentioned in section 6.2.1.1 – Certification Requirements, for home health services to
be covered by Medicare, the certifying physician’s and/or the acute/post-acute care
facility’s medical record for the patient must contain sufficient documentation of the
patient’s medical condition(s) to substantiate eligibility for home health services. The
information may include, but is not limited to, such factors as the patient’s diagnosis,
duration of the patient’s condition, clinical course (worsening or improvement),
prognosis, nature and extent of functional limitations, other therapeutic interventions and
results, etc.
The physicians’/acute/post-acute care facility’s medical records can always stand alone
in substantiating eligibility for home health services. The physician’s/acute/post-acute
care facility’s record, in conjunction with appropriately incorporated HHA
documentation (e.g., Form 485/Plan of Care, OASIS, etc.), may also substantiate the
certification of eligibility for home health services. The HHA’s generated medical
record documentation for the patient, by itself, is not sufficient in demonstrating the
patient’s eligibility for Medicare home health services.
As noted earlier, per 42CFR424.22 (a) and (c) it is the patient’s medical record held by
the certifying physician and/or the acute/post-acute care facility that must support the
patient’s eligibility for home health services. Therefore, any documentation used to
support certification that was generated by the home health agency must be signed off
by the certifying physician and incorporated into the medical record held by the
physician or the acute/post-acute care facility’s medical record. Any information

provided to the certifying physician by the HHA and incorporated into the patient’s
medical record held by the physician or the acute/post-acute care facility’s medical
record (if the patient was directly admitted to home health) must corroborate the rest of
the patient’s medical record. This means that the HHA information, along with the
certifying physician’s and/or the acute/post-acute care facility’s medical record, creates
a clinically consistent picture that the patient is eligible for Medicare home health
services. This could include, but is not limited to, the plan of care required per 42 CFR
409.43, the initial and/or the comprehensive assessment of the patient required per 42
CFR 484.55, the inpatient discharge summary or multi-disciplinary clinical notes, etc.,
which must correspond to the dates of service being billed and not contradict the
certifying physician’s and/or the acute/post-acute care facility’s own documentation or
medical record entries. Once incorporated into the certifying physician’s medical record
for the patient, the HHA information can be used to support the patient’s homebound
status and need for skilled care, the reviewer shall consider all documentation from the
HHA that has been signed off in a timely manner and incorporated into the
physician/hospital record when making its coverage determination. HHA
documentation that is used to support the home health certification is considered to be
incorporated timely when it is signed off prior to or at the time of claim submission.
See section 6.2.6 Examples of Sufficient Documentation Incorporated into a
Physician’s Medical Record.
It is important to apply the review process to the entire patient’s medical record that is
received by the reviewer. Doing so assures that the reviewer is establishing that the HHA
generated medical record documentation corroborates other patient medical records
received and used to support the patient’s eligibility for home health services. Therefore,
the HHA generated documentation does not necessarily need to restate pertinent facts or
conditions, but instead the HHA generated medical records for the patient should be in
alignment with and not contradict other patient records. The HHA generated medical
record for the patient together with other medical records received must lead the reviewer
to confirm that the patient is eligible for home health services as established in 42 CFR
424.22(a)(1).
6.2.4 - Coding
(Rev. 603, Issued: 07-21-15, Effective: 08-11-15, Implementation: 08-11-15)
If the patient’s comprehensive assessment or recertification assessment was signed off
and incorporated into the certifying physician’s medical record for the patient (or the
acute/post-acute care facility’s medical record if the patient was directly admitted to
home health), contractors shall use it to determine whether the Home Health Resource
Group (HHRG) codes billed were accurate and appropriate. In addition, if the
comprehensive assessment is incorporated into the certifying physician’s record for the
patient and is used to support that the patient meets the home health eligibility criteria,

then the diagnoses and conditions listed on the start of care assessment must be
corroborated by information in the certifying physician’s and/or the acute/post-acute care
facility’s own medical record documentation.
The contractor shall use the web regrouping program provided by CMS to recode claims
as appropriate.
6.2.5 - Medical Necessity of Services Provided
(Rev. 603, Issued: 07-21-15, Effective: 08-11-15, Implementation: 08-11-15)
In addition to certification and recertification requirement documentation, contractors
shall also review the medical record documentation to determine whether services
provided were medically necessary. Again, home health generated information must be
reviewed, signed off by the certifying physician and incorporated into the certifying
physician medical record for the patient or the acute/post-acute care facility’s medical
record for the patient (if the patient was directly admitted to home health) if used to
support certification/recertification.
6.2.6 - Examples of Sufficient Documentation Incorporated Into a
Physician’s Medical Record
(Rev. 603, Issued: 07-21-15, Effective: 08-11-15, Implementation: 08-11-15)
To be eligible for Medicare home health services, a patient must have Medicare Part A
and/or Part B and, per §1814(a)(2)(C) and §1835(a)(2)(A) of the Act:
• 	Be confined to the home;
• 	Need skilled services;
• 	Be under the care of a physician;
• 	Receive services under a plan of care established and reviewed by a physician;
and
• 	Have had a face-to-face encounter with a physician or allowed non-physician
practitioner (NPP).
EXAMPLE 1:
Does the below submitted documentation support the certification statement stating that
the patient meets the eligibility criteria for home health benefit certification? Yes.
Records received by the reviewer for a HHA claim for dates of service starting on
4/15/2015:
1. 	Patient was admitted to the hospital with a right-sided femur fracture sustained
from a fall requiring surgery. A discharge summary dated April 14, 2015, signed
by the inpatient attending physician. Included in the summary was a description
of the patient’s injury, DME required, non-weight-bearing status, and the name of
and appointment date for the community orthopedic physician who would

continue to follow-up with patient, and the notation of the order for home physical
therapy for home safety evaluation, gait training and strengthening 2-3 times per
week for 6 weeks to be delivered by an HHA.
Meets requirements for a face-to-face encounter (occurred within the required timeframe,
was performed by an allowed provider type, and related to the primary reason the patient
requires home health). Identifies the need for skilled services and alludes to the fact that
the patient is most likely homebound because of the non-weight-bearing status and the
order for DME. Identifies physician who will be providing care while patient is receiving
home health services. Plan of care established with physician orders.
2. 	HHA generated comprehensive assessment (admission OASIS) dated 04/15/2015
along with physical therapy progress notes. PT progress note documents patient
is non-weight bearing on right leg and requires use of a two-handed device to
walk alone on a level surface, and requires assistance to negotiate stairs or steps
or uneven surfaces. The HHA assessment with progress notes has been signed by
the community orthopedic certifying physician.
PT progress note further supports that patient is confined to the home.
3. 	The community orthopedic physician-signed certification statement for HH
services for start of care date of April 15, 2015.
Certification statement signed by certifying physician.
4. 	HHA generated plan of care, which specifies the type, frequency and goals for
therapies. The plan of care includes the signature of the certifying physician.
Supports that plan of care has been established and reviewed by the certifying
physician.
EXAMPLE TWO:
Does the below submitted documentation support the certification statement stating that
the patient meets the eligibility criteria for home health benefit certification? Yes.
Records received by the reviewer for a HHA claim for dates of service starting on
February 1, 2015:
1. 	Primary care physician progress note dated November 15, 2014. States reason for
visit is patient has a non-healing left foot diabetic foot ulcer measuring 1 cm x1
cm x 0.5 cm. Patient instructed on wound care with hydroactive gel dressing to
be changed every 3 days. Patient able to return demonstrate application of
dressing without difficulties.

Meets requirements for a face-to-face encounter (occurred within the required
timeframe, was performed by an allowed provider type, and related to the primary
reason the patient requires home health).
2. 	Clinical note in physician record states that patient called primary care physician
(PCP) on January 30th stating that the wound has gotten larger and there is
copious purulent drainage causing the dressing to be saturated. She states she is
unable to adequately change the dressing and keep it in place because of the size
of the wound and the amount of drainage. Patient just recovering from
pneumonia and she says she is unable to come into the physician’s office because
she cannot drive. PCP made referral to HHA for skilled nursing services to
evaluate the wound.
Identifies the need for skilled services.
3. 	HHA generated comprehensive assessment (admission OASIS) dated 02/01/2015
along with skilled nursing notes which includes wound measurements, condition
of wound, and documentation of physician phone call to report findings and
receipt of verbal orders for daily wound care for 3 weeks, monitor and teach on
signs and symptoms of infection and initiation of oral antibiotics twice a day for
14 days. Nursing notes also states that the patient is significantly deconditioned,
as a result of recent pneumonia, requires the use of a walker to ambulate from
chair to bathroom with frequent stops to rest.
HHA skilled nursing notes further support that patient needs skilled services to initiate
new wound care regimen, monitor for infection and that the patient is confined to the
home. Physician’s verbal orders for daily wound care establish the plan of care.
4. 	The primary care physician-signed certification statement for HH services for
start of care date of February 1, 2015.
Certification statement signed by certifying physician.
5. 	HHA generated plan of care, which specifies the wound care orders, frequency of
skilled nursing visits and goals for home health services. The plan of care
includes the signature of the certifying physician.
Supports that plan of care has been established and reviewed by the certifying physician.
6.2.7 - Medical Review of Home Health Demand Bills
(Rev. 721; Issued: 06-09-17; Effective: 07-11-17; Implementation: 07-11-17)
As a result of litigation settlements, A/B MACs (A) must perform medical record reviews
on 100% of the home health demand bills.

6.3 – Medical Review of Certification and Recertification of Residents in
SNFs
(Rev. 823; Issued: 10-05-18; Effective: 11-06-18; Implementation: 11-06-18)
The Medicare conditions of payment require a physician certification and (when specified)
recertification for SNF services. This requirement is explicitly stated in §1814(a)(2) of the
Social Security Act. 42 CFR 424.20 details the required contents of the certification and re-
certifications and 42 CFR 424.11 specifies that "no specific procedures or forms are required
for certification and recertification statements," and that "the provider may adopt any method
that permits verification. The certification and recertification statements may be entered on
forms, notes, or records that the appropriate individual signs, or on a special separate form"
(emphasis added). Further, 42 CFR § 424.11(b) specifies that information contained in other
provider records, such as physicians’ progress notes, need not be repeated in the certification
or recertification statement itself. Recent decisions by administrative law judges, that CMS
believes are fully consistent with law and regulations, reinforce the need for MACs to
consider documentation in the beneficiary's medical record beyond a discrete certification or
recertification form to determine if the required elements for certification are present.
Contractors shall deny claims for failure to comply with the certification or re-certification
content requirements in 42 CFR 424.20 and not for the failure to use a separate certification
form or particular format.
6.4 - Medical Review of Rural Air Ambulance Services
(Rev. 102, Issued: 02-01-05, Effective: 01-01-05, Implementation: 02-14-05)
6.4.1 – “Reasonable” Requests
(Rev. 308, Issued: 10-30-09, Effective: 11-30-09, Implementation: 11-30-09)
Rural air ambulance transport shall be considered reasonable and necessary when a
physician or other qualified medical personnel orders or certifies the air transport service.
A physician or other qualified medical personnel must certify or determine that the
individual’s condition requires air transport due to time or geographical factors. The
following should be considered to be personnel qualified to order air ambulance services:
• 	Physician,
• 	Registered nurse practitioner (from the transferring hospital),
• 	Physician’s assistant (from transferring hospital),
• 	Paramedic or EMT (at the scene), and
• 	Trained first responder (at the scene).
6.4.2 – Emergency Medical Services (EMS) Protocols
(Rev. 308, Issued: 10-30-09, Effective: 11-30-09, Implementation: 11-30-09)
Per Section 415 of the Medicare Modernization act of 2003, the reasonable and necessary
requirement for rural air transport may be “deemed” to be met when the service is
provided pursuant to an established State or regional emergency medical services (EMS)

agency protocol. CMS defines “established” to mean those protocols, which have been
reviewed and approved by State EMS agencies or have been developed according to
State EMS umbrella guidelines. Additionally, the protocol must be recognized or
approved by the Secretary.
The information on the FI, carrier, or MAC Web site must inform rural air ambulance
providers that if they anticipate transport based upon the contents of such a protocol
(either State or regional) they must submit that protocol in advance to the fiscal
intermediaries, carriers, or MACs for review and approval. Include instructions on the
Web site for submitting the protocol. The contractor will review the protocol to ensure
that the contents are consistent with statutory requirements at 1862(a)(1)(A), which direct
that all services paid for by Medicare must be reasonable and necessary for the diagnosis
or treatment of an illness or injury. The contractor shall make a determination regarding
the protocol and/or subsequent revisions and notify the rural air ambulance provider of
their determination within 30 days of receipt of the protocol.
Approval of a protocol does not exempt the provider from requirements in the Act at
1861(s)(7) and regulatory requirements at 42 CFR 424.106 which outlines the criteria for
determining whether the hospital was the most accessible. Regardless of protocol
instructions regarding transport locations Medicare payment can be made only to the
closet facility capable of providing the care needed by the beneficiary.
6.4.3 – Prohibited Air Ambulance Relationships
(Rev. 102, Issued: 02-01-05, Effective: 01-01-05, Implementation: 02-14-05)
Do not apply the “deemed” reasonable and necessary determination if there is a financial
or employment relationship between the person requesting the air ambulance service and
the entity furnishing the service; an entity under common ownership with the entity
furnishing the service; or a financial relationship between an immediate family member
of the person requesting the service and the entity furnishing the service. Only one
exception is available for this provision. When the referring hospital and the entity
furnishing the air ambulance services are under common ownership, the above limitation
does not apply to remuneration by the hospital for provider based physician services
furnished in a hospital, reimbursed under Part A and the amount of the remuneration is
unrelated directly or indirectly to the provision of air ambulance services.
6.4.4 – Reasonable and Necessary Services
(Rev. 308, Issued: 10-30-09, Effective: 11-30-09, Implementation: 11-30-09)
When data analysis indicates, fiscal intermediaries, carriers, or MACs may perform
medical review of rural air ambulance claims in those instances noted in the above
paragraph where there is financial or employment relationship between the person
requesting an air ambulance transport and the person providing the service. The fiscal
intermediaries, carriers, or MACs may also conduct medical review of rural air
ambulance claims with “deemed” medical necessity status when there are questions as to

whether the transport was made pursuant to a protocol which has been approved by the
Secretary; or questions as to whether the transport was inconsistent with an approved
protocol. Medicare payment can be made only to the closest facility capable of providing
the care needed by the beneficiary irrespective of whom orders the transport.
6.4.5 – Definition of Rural Air Ambulance Services
(Rev. 102, Issued: 02-01-05, Effective: 01-01-05, Implementation: 02-14-05)
For purposes of this section the term “rural air ambulance service” means fixed wing and
rotary wing air ambulance service in which the point of pick up of the individual occurs
in a rural area (as defined in Section 1886(d)(2)(D)) or in a rural census tract of a
metropolitan statistical area (as determined under the most recent modification of the
Goldsmith Modification, originally published in the Federal Register on February 27,
1992 (57 Fed. Reg. 6725).
6.5 - Medical Review of Inpatient Hospital Claims for Part A Payment
(Rev. 716, Issued: 05-12-17, Effective: 06-13-17, Implementation: 06-13-17)
6.5.1 - (Reserved for future use)
(Rev. 13409; Issued: 09-12-25; Effective: 10-13-25; Implementation: 10-13-25)
6.5.2 - Conducting Patient Status Reviews of Claims for Medicare Part
A Payment for Inpatient Hospital Admissions
(Rev. 13409; Issued: 09-12-25; Effective: 10-13-25; Implementation: 10-13-25)
This section applies to Unified Program Integrity Contractors (UPIC), Medicare
Administrative Contractors (MAC), Supplemental Medical Review Contractor (SMRC),
Recovery Audit Contractors and the Comprehensive Error patient Rate Testing (CERT)
contractor.
For purposes of determining the appropriateness of Medicare Part A payment, Medicare
contractors shall conduct reviews of medical records for inpatient acute IPPS hospital,
Critical Access Hospital (CAH), Inpatient Psychiatric Facility (IPF) and Long Term Care
Hospital (LTCH) claims, as appropriate and as so permitted by CMS, based on data
analysis and their prioritized medical review strategies. Review of the medical record
must indicate that hospital care was medically necessary, reasonable, and appropriate for
the diagnosis and condition of the beneficiary and that the stay was appropriate for
Medicare Part A payment.
A. Determining the Appropriateness of Part A Payment
The term “patient status review” refers to reviews conducted by Medicare contractors to
determine a hospital’s compliance with Medicare requirements to bill for Medicare Part
A payment. Medicare contractors shall conduct such reviews in accordance with two
distinct, but related, medical review policies: a 2-midnight presumption, which helps
guide contractor selection of claims for medical review, and a 2-midnight benchmark,

which helps guide contractor reviews of short stay hospital claims for Part A payment.
“Patient status reviews” may result in determinations that claims are not properly payable
under Medicare Part A; “patient status reviews” do not involve changing a beneficiary’s
status from inpatient to outpatient.
Per the 2-midnight presumption, Medicare contractors shall presume hospital stays
spanning 2 or more midnights after the beneficiary is formally admitted as an inpatient
are reasonable and necessary for Part A payment. Medicare contractors shall not focus
their medical review efforts on stays spanning 2 or more midnights after formal inpatient
admission absent evidence of systematic gaming, abuse, or delays in the provision of care
in an attempt to qualify for the 2-midnight presumption.
Per the 2-midnight benchmark, hospital stays are generally payable under Part A if the
admitting practitioner expects the beneficiary to require medically necessary hospital care
spanning 2 or more midnights, and such reasonable expectation is supported by the
medical record documentation. Medicare Part A payment is generally not appropriate for
hospital stays expected to span less than 2 midnights. If a stay is not reasonably expected
to span 2 or more midnights, Medicare contractors shall assess the claim to determine if
an exception exists that would nonetheless make Part A payment appropriate, including:
• 	If the procedure is on the Secretary’s list of “inpatient only” procedures
(identified through annual regulation);
• 	If the procedure is a CMS-identified, national exception to the 2-midnight
benchmark; or
• 	If the admission otherwise qualifies for a case-by-case exception to the 2-
midnight benchmark because the medical record documentation supports the
admitting physician/practitioner’s judgment that the beneficiary required hospital
care on an inpatient basis despite the lack of a 2- midnight expectation. Medicare
contractors shall note CMS’ expectation that stays under 24 hours would rarely
qualify for an exception to the 2- midnight benchmark.
Hospital treatment decisions for beneficiaries are based on the medical judgment of
physicians and other qualified practitioners. The 2-midnight rule does not prevent such
practitioners from providing any service at any hospital, regardless of the expected
duration of the service. Rather, it provides a benchmark to help guide consistent Part A
payment decisions.
I. Reviewing Hospital Claims for Patient Status: The 2-Midnight Benchmark
A. Determine if the stay involved an “Inpatient Only” procedure
When conducting patient status reviews, assuming all other coverage requirements are
met, the Medicare review contractor shall determine Medicare Part A payment to be

appropriate if a medically necessary procedure classified by the Secretary as an “inpatient
only” procedure is performed. “Inpatient only” procedures are so designated per 42
C.F.R. § 419.22(n), and are detailed in the annual Outpatient Prospective Payment
System (OPPS) regulation.
Medicare contractors shall review the medical documentation and make an initial
determination of whether a medically necessary inpatient only procedure is documented
within the medical record. If so, and if the other requisite elements for payment are
present, then the Medicare review contractor shall deem Medicare Part A payment to be
appropriate, without regard to the expected or actual length of stay.
If the Medicare review contractor does not identify an inpatient only procedure during the
initial review, the claim should be assessed in accordance with the 2-midnight
benchmark.
B. Calculating Time Relative to the 2-Midnight Benchmark
Per the 2-midnight benchmark, Medicare contractors shall assess short stay (i.e., less than
2 midnights after formal inpatient admission) hospital claims for their appropriateness for
Part A payment. Generally, hospital claims are payable under Part A if the contractor
identifies information in the medical record supporting a reasonable expectation on the
part of the admitting practitioner at the time of admission that the beneficiary would
require a hospital stay that crossed at least two midnights.
Medicare review contractor reviews shall assess the information available at the time of
the original physician/practitioners’ decision. The expectation for sufficient
documentation is well rooted in good medical practice. Physician/practitioners need not
include a separate attestation of the expected length of stay; rather, this information may
be inferred from the physician/practitioner’s standard medical documentation, such as his
or her plan of care, treatment orders, and progress notes. Medicare contractors shall
consider the complex medical factors that support both the decision to keep the
beneficiary at the hospital and the expected length of the stay. These complex medical
factors may include, but are not limited to, the beneficiary’s medical history and
comorbidities, the severity of signs and symptoms, current medical needs, and the risk
(probability) of an adverse event occurring during the time period for which
hospitalization is considered. The entire medical record shall be reviewed to support or
refute the reasonableness of the practitioner’s expectation, but entries after the point of
the admissions order are only used in the context of interpreting what the practitioner
knew and expected at the time of admission.
For purposes of determining whether the admitting practitioner had a reasonable
expectation of hospital care spanning 2 or more midnights at the time of admission, the
Medicare contractors shall take into account the time the beneficiary spent receiving
contiguous outpatient services within the hospital prior to inpatient admission. This pre-
admission time may include services such as observation services, treatments in the
emergency department (ED), and procedures provided in the operating room or other
treatment area.

If the beneficiary was transferred from one hospital to another, then for the purpose of
determining whether the beneficiary satisfies the 2-midnight benchmark at the recipient
hospital, the Medicare contractors shall take into account the time and treatment provided
to the beneficiary at the initial hospital. That is, the start clock for transfers begins when
the care begins in the initial hospital. In the event that a beneficiary was transferred from
one hospital to another, the Medicare review contractor shall request documentation that
was authored by the transferring hospital to support the medical necessity of the services
provided and to verify when the beneficiary began receiving hospital care. Medicare
contractors will generally expect this information to be provided by the recipient hospital
seeking Part A payment.
Medicare contractors shall continue to follow CMS' longstanding instruction that
Medicare Part A payment is prohibited for care rendered for social purposes or reasons of
convenience that are not medically necessary. Therefore, Medicare contractors shall
exclude extensive delays in the provision of medically necessary care from the 2-
midnight benchmark calculation. Factors that may result in an inconvenience to a
beneficiary, family, physician or facility do not, by themselves, support Part A payment
for an inpatient admission. When such factors affect the beneficiary's health, Medicare
contractors shall consider them in determining whether Part A payment is appropriate for
an inpatient admission.
NOTE: While, as discussed above, the time a beneficiary spent as an outpatient before
being admitted as an inpatient is considered during the medical review process for
purposes of determining the appropriateness of Part A payment, such time does not
qualify as inpatient time. (See Pub. 100-02, Ch. 1, Section 10.2 for additional information
regarding the formal order for inpatient admission.)
C. Unforeseen Circumstances Interrupting Reasonable Expectation
The 2-midnight benchmark is based on the expectation at the time of admission that
medically necessary hospital care will span 2 or more midnights. Medicare contractors
shall, during the course of their review, assess the reasonableness of such expectations. In
the event that a stay does not span 2 or more midnights, Medicare contractors shall look
to see if there was an intervening event that nonetheless supports the reasonableness of
the physician/practitioner’s original judgment. An event that interrupts an otherwise
reasonable expectation that a beneficiary’s stay will span 2 or more midnights is
commonly referred to by CMS and its contractors as an unforeseen circumstance. Such
events must be documented in the medical record, and may include, but are not limited
to, unexpected: death, transfer to another hospital, departure against medical advice,
clinical improvement, and election of hospice in lieu of continued treatment in the
hospital.
D. Stays Expected to Span Less than 2 Midnights

When a beneficiary enters a hospital for a surgical procedure not specified by Medicare
as inpatient only under 42 C.F.R. § 419.22(n), a diagnostic test, or any other treatment,
and the physician expects to keep the beneficiary in the hospital for less than 2 midnights,
the services are generally inappropriate for inpatient payment under Medicare Part A,
regardless of the hour that the patient came to the hospital or whether the beneficiary
used a bed.
The Medicare review contractor shall assess such claims to see if they qualify for a
general or case-by-case exception to this generalized instruction, which would make the
claim appropriate for Medicare Part A payment, assuming all other requirements are met.
E. 	Exceptions to the 2-Midnight Rule
1. 	Medicare’s Inpatient-Only List
As discussed above, inpatient admissions where a medically necessary Inpatient-Only
procedure is performed are generally appropriate for Part A payment regardless of
expected or actual length of stay.
2. 	Nationally-Identified Rare & Unusual Exceptions to the 2-Midnight Rule
If a general exception to the 2-midnight benchmark, as identified by CMS, is present
within the medical record, the Medicare review contractor shall consider the inpatient
admission to be appropriate for Part A payment so long as other requirements for Part A
payment are met.
CMS has identified the following national or general exception to the 2-midnight rule:
Mechanical Ventilation Initiated During Present Visit
CMS believes newly initiated mechanical ventilation to be rarely provided in
hospital stays less than 2 midnights, and to embody the same characteristics as
those procedures included in Medicare’s inpatient–only list. While CMS believes
a physician will generally expect beneficiaries with newly initiated mechanical
ventilation to require 2 or more midnights of hospital care, if the physician
expects that the beneficiary will only require one midnight of hospital care, but
still orders inpatient admission, Part A payment is nonetheless generally
appropriate.
3. 	Physician-Identified Case-by-Case Exceptions to the 2-Midnight Rule
For hospital stays that are expected to span less than 2 midnights, an inpatient admission
may be payable under Medicare Part A on a case-by-case or individualized basis if the
medical record supports the admitting physician/practitioner’s judgment that the
beneficiary required hospital care on an inpatient basis despite the lack of a 2-midnight
expectation. Medicare contractors shall consider, when assessing the physician’s
decision, complex medical factors including, but not limited to:

• 	The beneficiary history and comorbidities;
• 	The severity of signs and symptoms;
• 	Current medical needs; and
• 	The risk of an adverse event.
Medicare contractors shall note CMS’ expectation that stays under 24 hours would rarely
qualify for an exception to the 2- midnight benchmark, and as such, may be prioritized
for medical review.
A. Determining Whether Covered Care Was Given at Any Time During a Stay in a PPS
Hospital
Medicare contractors shall utilize the medical record to determine whether procedures
and diagnoses were coded correctly. If the medical record supports that they were, pay
the claim as billed. If the medical record supports that they were not, then utilize ICD-9-
CM or ICD-10-CM coding guidelines to adjust the claim and pay at the appropriate
DRG. See section 6.5.4 of this chapter for further details on DRG validation review.
When you determine that the beneficiary did not, at the time of admission, have an
expected length of stay of 2 or more midnights, or otherwise meet CMS standards for
payment of an inpatient admission, but that the beneficiary's condition changed during
the stay and Part A payment became appropriate, you shall review the case in accordance
with the following procedures:
• 	The first day on which inpatient care is determined to be medically necessary is
deemed to be the date of admission;
• 	The deemed date of admission applies when determining cost outlier status (i.e.,
days or services prior to the deemed date of admission are excluded for outlier
purposes); and
• 	The diagnosis determined to be chiefly responsible for the beneficiary's need for
covered services on the deemed date of admission is the principal diagnosis.
• 	Adjust the claim according to the diagnosis determined to be responsible for the
need for medically necessary care to have been provided on an inpatient basis.
When a contractor determines that the beneficiary did not meet the requirements for Part
A payment at any time during the admission, the contractor shall deny the claim in full.

6.5.3 - DRG Validation Review
(Rev. 608, Issued: 08-14-15, Effective: 01-01-12, Implementation: 09-14-15)
The contractor shall perform DRG validation on PPS, as appropriate, reviewing the
medical record for medical necessity and DRG validation. The purpose of DRG
validation is to ensure that diagnostic and procedural information and the discharge status
of the beneficiary, as coded and reported by the hospital on its claim, matches both the
attending physician's description and the information contained in the beneficiary's
medical record. Reviewers shall validate principal diagnosis, secondary diagnoses, and
procedures affecting or potentially affecting the DRG.
NOTE: For PPS waived/excluded areas, review shall be performed appropriate to your
area.
A. Coding
The contractor shall use individuals trained and experienced in ICD coding to perform
the DRG validation functions. The validation is to verify the accuracy of the hospital's
ICD coding of all diagnoses and procedures that affect the DRG.
The contractor shall base DRG validation upon accepted principles of coding practice,
consistent with guidelines established for ICD coding, the Uniform Hospital Discharge
Data Set data element definitions, and coding clarifications issued by CMS. The
contractor shall not change these guidelines or institute new coding requirements that do
not conform to established coding rules.
The contractor shall verify a hospital's coding in accordance with the coding principles
reflected in the ICD Coding Manual. Contractors shall use the ICD version in place at
the time the services were rendered, and the official National Center for Health Statistics
and CMS addenda, which update the ICD Manual annually. The annual addenda are
effective on October 1 of each year and apply to discharges occurring on or after October
1. The contractor shall use only ICD Manual volumes based on official ICD Addendum
and updates when performing DRG validation.
Hospitals are not required to code minor diagnostic and therapeutic procedures (e.g.,
imaging studies, physical, occupational, respiratory therapy), but may do so at their
discretion.
B. Diagnoses
Contractors shall ensure that the hospital reports the principal diagnosis and all relevant
secondary diagnoses on the claim. The relevant diagnoses are those that affect DRG
assignment. The hospital must identify the principal diagnosis when secondary diagnoses
are also reported. When a comorbid condition, complication, or secondary diagnosis
affecting the DRG assignment is not listed on the hospital's claim but is indicated in the

medical record, insert the appropriate code on the claim form. If the hospital already
reported the maximum number of diagnoses allowed on the claim form, delete a code that
does not affect DRG assignment, and insert the new code.
The contractor is not required to code additional diagnoses on the claim as long as all
conditions that affect the DRG are reflected in the diagnoses already listed, and the
principal diagnosis is correct and properly identified. The hospital can list the secondary
diagnoses in any sequence on the claim form because the GROUPER program will
search the entire list to identify the appropriate DRG assignment.
• 	Principal Diagnosis -The contractor shall determine whether the principal
diagnosis listed on the claim is the diagnosis which, after study, is determined to have
occasioned the beneficiary's admission to the hospital. The principal diagnosis (as
evidenced by the physician's entries in the beneficiary's medical record) (see 42 CFR
412.46) must match the principal diagnosis reported on the claim form. The principal
diagnosis must be coded to the highest level of specificity. For example, a diagnosis
from "Symptoms, Signs, and Ill-defined Conditions," may not be used as the principal
diagnosis when the underlying cause of the beneficiary's condition is known.
• 	Inappropriate Diagnoses -The contractor shall exclude diagnoses relating to an
earlier episode that have no bearing on the current hospital stay. Delete any incorrect
diagnoses and revise the DRG assignment as necessary.
C. Procedures
The contractor shall ensure that the hospital has reported all procedures affecting the
DRG assignment on the claim. If there are more procedures performed than can be listed
on the claim, verify that those reported include all procedures that affect DRG
assignment, and that they are coded accurately. See section 6.5.4 below for further detail
on reviewing procedures.
6.5.4 – Review of Procedures Affecting the DRG
(Rev. 475, Issued: 07-19-13, Effective Date: 08-19-13; Implementation Date: 08-19-
13)
The contractor shall determine whether the performance of any procedure that affects, or
has the potential to affect, the DRG was reasonable and medically necessary. If the
admission and the procedure were medically necessary, but the procedure could have
been performed on an outpatient basis if the beneficiary had not already been in the
hospital, do not deny the procedure or the admission.
When a procedure was not medically necessary, the contractor shall follow these
guidelines:

If the admission was for the sole purpose of the performance of the non-covered
procedure, and the beneficiary never developed the need for a covered level of service,
deny the admission;
If the admission was appropriate, and not for the sole purpose of performing the
procedure, deny the procedure (i.e., remove from the DRG calculation), but approve the
admission;
If performing a cost outlier review, in accordance with Pub. 100-10, chapter 4, §4210 B,
and the beneficiary was in the hospital for any day(s) solely for the performance of the
procedure or care related to the procedure, deny the costs for the day(s) and for the
performance of the procedure; and
If performing a cost outlier review, and the beneficiary was receiving the appropriate
level of covered care for all hospital days, deny the procedure or service.
See Pub. 100-02, Chapter 1, §10 for further detail on payment of inpatient claims
containing non-covered services.
6.5.5 – Special Review Considerations
(Rev. 608, Issued: 08-14-15, Effective: 01-01-12, Implementation: 09-14-15)
Refer to Pub. 100-04, chapter 3, §20 C. for information regarding handling of claims with
DRG 468. This DRG represents a discharge with valid data but where the surgical
procedure is unrelated to the principal diagnosis.
Refer to 100-04, chapter 3, §20.2.1, subsection D.9. for a description of questionable
admission diagnosis codes. A/B MACs (A) may wish to consider including these
diagnoses in their data analysis.
For a listing of diagnosis codes identified as “questionable admission” codes see the
Medicare Code Editor (MCE) Web site at:
http://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/AcuteInpatientPPS/index.html?redirect=/AcuteInpatientPPS/01_overview.asp
Refer to 100-04, chapter 3, §20.2.1, subsection D.9 for a description of diagnoses which
are acceptable only when coded with a secondary diagnosis. A/B MACs (A) may wish to
include these diagnoses in their data analysis as the MCE will not reject them when they
are billed with a secondary diagnosis.
For a listing of diagnosis codes that are acceptable only when coded with a secondary
diagnosis see the MCE Website at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/AcuteInpatientPPS/Downloads/FY_14_Definition_of-
Medicare_Code_Edits_V_31_Manual.pdf

6.5.6 - Length-of-Stay Review
(Rev. 10365; Issued: 10-02-20; Effective: 08-27-20; Implementation: 08-27-20)
The contractor shall determine whether the length-of-stay for PPS cost outlier claims and
specialty hospital/unit claims, when selected for medical review, is appropriate and
medically necessary. Identify cases of potential delayed discharge. For example, the
beneficiary was medically stable, and continued hospitalization was unnecessary, or
nursing home placement or discharge to home with home care would have been
appropriate in providing needed care without posing a threat to the safety or health of the
beneficiary (see §4110).
If Medicare payment is applicable to only part of the stay, review the covered portion of
the stay and enough of the rest of the medical record (if necessary) to answer any specific
questions that may arise from review of the covered part of the stay. If a beneficiary
became Medicare eligible during a hospital stay, review enough of the medical record
prior to the initiation of Medicare benefits to acquire sufficient information to make a
determination. Do not perform lengthy reviews of non-covered care. In PPS
waived/excluded areas, length-of-stay review is performed for all inpatient admissions
that are selected for medical review.
The contractor shall determine whether the length of stay was appropriate for claims
selected for medical review that represent PPS cost outliers. However, the contractor
shall not include days on which care is determined not to have been medically necessary
in the calculation of outlier payments. Where it is determined that a beneficiary’s stay
was unnecessarily long, and potentially represents fraud or abuse, the contractor shall
make a referral to the UPIC.
6.5.7 - Reserved for Future Use
(Rev. 475, Issued: 07-19-13, Effective Date: 08-19-13; Implementation Date: 08-19-
13)
6.5.8 - Reserved for Future Use
(Rev. 475, Issued: 07-19-13, Effective Date: 08-19-13; Implementation Date: 08-19-
13)
6.5.9 - Circumvention of PPS
(Rev. 10365; Issued: 10-02-20; Effective: 08-27-20; Implementation: 08-27-20)
If you suspect, during review of a claim associated with a transfer or readmission, that a
provider of Medicare services took an action with the intent of circumventing PPS (as
described in §1886(f)(2) of the Act) and that action resulted in unnecessary admissions,
premature discharges and readmissions, multiple readmissions, or other inappropriate
medical or other practices with respect to beneficiaries or billing for services, you shall
make a referral to your Unified Program Integrity Contractor (UPIC).
6.6 - Referrals to the Quality Improvement Organization (QIO)

(Rev. 10365; Issued: 10-02-20; Effective: 08-27-20; Implementation: 08-27-20)
The MACs shall only refer Quality of (Health) Care Concerns to the QIOs. A Quality of
(Health) Care Concern is defined as “a concern that care provided did not meet a
professionally recognized standard of health care.” The Contractor shall follow the
referral process as agreed upon in the QIO-MAC Joint Operating Agreement. The QIOs
will retain their responsibility for performing expedited determinations, Hospital-Issued
Notices of Non-Coverage (HINN) reviews, quality reviews, transfer reviews, readmission
reviews and, provider-requested higher-weighted DRG reviews.
The Circumvention of PPS will continue to be reported to your UPIC. The quality
initiatives associated with payment for performance are now the reporting source for
Readmission Reviews and Transfer Review data to the QIOs. Non-covered
benefits/services are not to be reported to the QIO.
All initial payment determinations and claim adjustments are required to be performed by
the MAC.
All MACs are to turn off all automated edits/processes that generate a referral to the
QIOs prior to a medical record review of the claim. Referrals to the QIO shall be limited
to Quality of Health Care issues as defined above and shall result from a clinician’s
medical record review of a provider’s medical documentation.
If during the medical record review process, “a concern that care provided did not meet a
professionally recognized standard of health care,” the MAC shall issue a payment
determination and/or adjustment for the claim, complete the QIO referral form, and
forward the completed referral form and file(s) to the QIO. If the referral form is not
complete, the QIO will return the file to the MAC and request that the MAC provide the
missing information prior to the QIO performing a review.
A non-covered service and/or procedure shall not be automatically referred to the QIO.
The MAC shall make the initial payment determination and/or claim adjustment for a
non-covered service or procedure in accordance with the Medicare IOM 100-04, Claims
Processing Manual and IOM 100-02, Benefit Policy Manual.
If during the medical record review process, “a concern that care provided did not meet a
professionally recognized standard of health care,” such as a medically unnecessary
procedure, the claim shall be referred to the QIO for quality review after payment
determination and/or claim adjustment is made.
The MACs shall not instruct providers, suppliers, or beneficiaries to refer payment issues
to the QIO. If the provider or supplier does not agree with the payment and/or claim
adjustment decision, the MAC shall communicate their options to follow the current
process in IOM 100-08, requesting a reopening or an appeal. If the beneficiary disagrees
with the payment decision and makes a request for re-evaluation/redetermination, this
will be considered a demand bill and is the responsibility of the MAC.

6.7 - Medical Review of Inpatient Rehabilitation Facility (IRF) Services
(Rev. 10184; Issued: 06-19-2020; Effective: 07-21-2020; Implementation: 07-21-
2020)
This section applies to Unified Program Integrity Contractors (UPIC), Medicare
Administrative Contractors (MAC), Supplemental Medical Review Contractor (SMRC),
Recovery Audit Contractors (RAC) and the Comprehensive Error Rate Testing (CERT)
Contractor, as indicated.
6.7.1 – Reviewing for Intensive Level of Rehabilitation Therapy Services
Requirements
(Rev. 10184; Issued: 06-19-2020; Effective: 07-21-2020; Implementation: 07-21-
2020)
When reviewing IRF claims, the UPIC, MAC, SMRC, CERT and RAC shall verify that
the IRF documentation requirements are met in accordance with IOM 100-02, Medicare
Benefit Policy Manual, Chapter 1, Section 110.
The UPIC, MAC, SMRC, CERT and RAC shall not make absolute claim denials based
solely on a threshold of therapy time not being met. When the current industry standard
of generally 3 hours of therapy (physical therapy, occupational therapy, speech-language
pathology, or prosthetics/orthotics) per day at least 5 days per week or at least 15 hours of
intensive rehabilitation therapy within a 7 consecutive day period is not met, the claim
shall undergo further review.
The UPIC, MAC, SMRC, CERT and RAC shall use clinical review judgment to
determine medical necessity of the intensive rehabilitation therapy program based on the
individual facts and circumstances of the case, and not on the basis of any threshold of
therapy time. The standard of care for IRF patients is individualized (i.e., one-on-one)
therapy. Group and concurrent therapy can be used on a limited basis within the current
industry standard of generally 3 hours of therapy per day at least 5 days per week or at
least 15 hours of intensive rehabilitation therapy within a 7-consecutive day period. In
those instances in which group therapy better meets the patient’s needs on a limited basis,
the situation/rationale that justifies group therapy should be specified in the patient’s
medical record at the IRF. However, MAC, SMRC, CERT and RAC shall not deny solely
because the situation/rationale that justifies group therapy is not submitted in response to
an ADR.
6.8 – Medical Review of Evaluation and Management (E/M)
Documentation
(Rev.808; Issued: 07-13-18; Effective: 08-14-18; Implementation: 08-14-18)
This section applies to MACs, RACs, UPICs, SMRC and CERT.

6.8.1 – Medical Review of E/M Documentation Provided by Student
(Rev.808; Issued: 07-13-18; Effective: 08-14-18; Implementation: 08-14-18)
The Medicare Claims Processing Manual, Chapter 12, Section 100.1.1 (B) states the
teaching physician must personally perform (or re-perform) the physical exam and
medical decision making activities of the E/M service being billed, but may verify any
student documentation of them in the medical record rather than re-documenting this
work. If the teaching physician chooses to rely on the medical student documentation and
chooses not to re-document the E/M service, contractors shall consider this requirement
met if the teaching physician signs and dates the medical student’s entry in the medical
record.
6.9 – Medical Review of Diagnostic Tests
(Rev. 850, Issued: 12-14-18; Effective: 12-17-18; Implementation: 12-17-18)
This section applies to MACs, RACs, UPICs, SMRC and CERT.
6.9.1 – Medical Review of Diagnostic Laboratory Tests
(Rev. 850, Issued: 12-14-18; Effective: 12-17-18; Implementation: 12-17-18)
42 CFR §410.32 states that all diagnostic x-ray tests, diagnostic laboratory tests, and
other diagnostic tests must be ordered by the physician who is treating the beneficiary
and that tests not ordered by the physician who is treating the beneficiary are not
reasonable and necessary.
Pub. 100-02, Chapter 15, Section 80.6.1 states that while a physician order is not required
to be signed, the physician must clearly document, in the medical record, his or her intent
that the test be performed.
Contractors shall consider order requirements for diagnostic laboratory tests met if there
is:
1. 	A signed order or signed requisition listing the specific test; or
2. 	An unsigned order or unsigned laboratory requisition listing the specific tests to
be performed AND an authenticated medical record that supports the
physician/practitioner’s intent to order the tests (e.g. “order labs”, “check
blood”, “repeat urine”); or
3. 	An authenticated medical record that supports the physician/practitioner’s intent
to order the specific tests.
See Pub. 100-08, Chapter 3, Section 3.3.2.4 for authentication requirements.
Regardless of how the order requirements are met, contractors shall verify that the
supporting authenticated medical record documentation contains sufficient information
supporting the ordered/provided tests are reasonable and necessary per 42 CFR §410.32.
Note: As noted in Pub. 100-02, Chapter 15, Section 80.6.1, if the order is communicated
via telephone, both the treating physician/practitioner or his/her office, and the testing

facility must document the telephone call in their respective copies of the beneficiary’s
medical records.

Transmittals Issued for this Chapter
Rev # 	Issue Date 	Subject 	Impl Date 	CR#
R13409PI 09/12/2025 	Update to Medical Review Instructions for
Inpatient Hospital Claims in Chapter 6 of
Publication (Pub.) 100-08, Program Integrity
Manual (PIM)
10/13/2025 14207
R10365PI 10/02/2020 	Updates to Chapters 1, 2, 3, 4, 5, 6, 7, 8, 10,
11, and Exhibits of Publication (Pub.) 100-08
08/27/2020 11884
R10228PI 07/27/2020 	Updates to Chapters 1, 2, 3, 4, 5, 6, 7, 8, 10,
11, and Exhibits of Publication (Pub.) 100-08
Rescinded and replaced by Transmittal 10365
08/27/2020 11884
R10184PI 06/19/2020 	Updates to Chapters 4, 6, and 8 of
Publication (Pub.) 100-08
07/21/2020 11812
R924PI 	11/15/2019 	Updates to the Medical Review Instructions
Related to Skilled Nursing Facilities (SNF)
12/17/2019 11520
R870PI 	03/22/2019 	Manual Updates Related to Home Health
Certification and Recertification Policy
Changes
04/22/2019 11104
R850PI 	12/14/2018 	Medical Review of Diagnostic Laboratory
Tests
12/17/2018 10908
R836PI 	10/19/2018 	Medical Review of Diagnostic Laboratory
Tests
11/21/2018 10908
R832PI 	10/05/2018 	Modification to Chapter 6, Section 6.3
(Medical Review of Certification and
Recertification of Residents in SNFs) of
Publication (Pub.) 100-08
11/06/2018 10921
R808PI 	07/13/2018 	Medical Review of Evaluation and
Management (E/M) Documentation
08/14/2018 10627
R771PI 	02/23/2018 	Clarification of Instructions Regarding the
Intensive Level of Rehabilitation Therapy
Services Requirements
03/23/2018 10482
R721PI 	06/09/2017 	Elimination of Routine Reviews Including
Documentation Compliance Reviews and
Instituting Three Medical Reviews
07/11/2017 9809
R716PI 	05/12/2017 	Clarifying Medical Review of Hospital
Claims for Part A Payment
06/13/2017 10080
R704PI 	03/17/2017 	Home Health (HH) Language in Pub. 100-8 	04/17/2017 10006
R656PI 	06/15/2016 	Medical Review of Skilled Nursing Facility
Prospective Payment System (SNF PPS)
Bills
06/28/2016 9571

Rev # 	Issue Date 	Subject 	Impl Date 	CR#
R651PI 	05/27/2016 	Medical Review of Skilled Nursing Facility
Prospective Payment System (SNF PPS)
Bills – Rescinded and replaced by
Transmittal 656
06/28/2016 9571
R608PI 	08/14/2015 	Update to Pub. 100-08 to Provide Language-
Only Changes for Updating ICD-10 and ASC
X12
09/14/2015 8747
R603PI 	07/21/2015 	Medical Review of Home Health Services 	08/11/2015 9189
R602PI 	07/10/2015 	Medical Review of Home Health Services –
Rescinded and replaced by Transmittal 603
08/11/2015 9189
R601PI 	07/02/2015 	Review of Home Health Claims 	08/03/2015 9240
R475PI 	07/19/2013 	PIM Chapter 6 MR Guidelines 6.54-6.5.7
Update
08/19/2013 8379
R308PI 	10/30/2009 	Rural Air Ambulance 	11/30/2009 6682
R264PI 	08/07/2008 	Transition of Responsibility for Medical
Review From Quality Improvement
Organizations (QIOs)
08/15/2008 5849
R196PI 	03/30/2007 	Medical Review of Skilled Nursing Facility
(SNF) Claims Using the MDS QC System
Software
04/30/2007 5418
R174PI 	11/17/2006 	Transition of Medical Review Educational
Activities
10/06/2006 5275
R171PI 	11/03/2006 	Transition of Medical Review Educational
Activities – Replaced by Transmittal 174
10/06/2006 5275
R163PI 	09/29/2006 	Transition of Medical Review Educational
Activities – Replaced by Transmittal 170
10/06/2006 5275
R102PI 	02/01/2005 	Medical Review of Rural Air Ambulance
Services
02/14/2005 3571
R093PI 	01/14/2005 	Medical Review of Rural Air Ambulance
Services - Replaced by Transmittal 102
02/14/2005 3571
R082PI 	07/23/2004 	Home Health Demand Bills 	08/23/2004 3266
R074PI 	04/23/2004 	SNF Certification and Recertification 	05/24/2004 3150
R071PI 	04/09/2004 	Rewrite of Program Integrity Manual (except
Chapter 10) to Apply to PSCs
05/10/2004 3030
R042PI 	06/20/2003 	Intermediary Medical Review Guidelines 	07/01/2003 2720
R026PIM 04/27/2002 	Deletes Section 1.7 Quality Issues in SNF
and Referral to other Agencies
N/A 	2100
R023PIM 03/18/2002 	Revises and clarifies HHAs Certification and
Plan of Care Data
05/02/2002 1981

Rev # 	Issue Date 	Subject 	Impl Date 	CR#
R020PIM 02/21/2002 	Revises Terminology used in Chap 6,sec 12
MR of Ambulance Services
04/01/2002 1974
R018PIM 01/17/2002 	Manualizes PM A-00-08, Revises the
existing SNF MR guidelines
N/A 	1064
R015PIM 10/29/2001 	MR of Partial Hospitalization Claims, 	12/13/2001 1831
R003PIM 11/22/2000 	Complete Replacement of PIM Revision 1. 	NA 	1292
R002PIM 9/15/2000 	Intermediary MR Guidelines for Specific
Services
NA 	882
R001PIM 06/2000 	Initial Release of Manual 	NA 	931
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