Nursing homes are increasingly billing for the highest level of therapy despite little change in patient need for therapy, according to a report released Wednesday by HHS' Office of Inspector General. Because of this, Medicare payments far exceed the costs for therapy provided at skilled nursing facilities.
According to the OIG, Medicare paid SNFs $1.1 billion in fiscal years 2012 and 2013 for therapy.
SNFs receive a daily rate for their services, including nursing and therapy, based on the amount of care provided. What is considered "ultrahigh" therapy (720 minutes or more of physical therapy per week) was reimbursed an average of $560 per day in 2013, according to a previous estimate by The Wall Street Journal. As therapy levels decrease, so do reimbursements, so that "very high" levels (500 to 719 minutes per week) are reimbursed an average of $445 per day, and "low" levels (45 to 149 minutes per week) are reimbursed $325 per day.
The OIG made these findings, which align with similar findings from 2006 to 2008, after examining Medicare claims, cost reports and beneficiary assessments from a 10-year period.
In light of this study and prior findings, the OIG recommended CMS evaluate possible reductions of Medicare payment rates for therapy, change the method for paying for therapy, adjust payments for increases unrelated to beneficiary characteristics and improve the oversight of SNF billing, according to the report.
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