| Tue, May 20, 2014 @ 09:00 AM

Medicare and Skilled Nursing Care & Therapy Services

Posted by Medicare Made Clear

skilled nursing careSome important developments have taken place within the past year in the way Medicare covers skilled nursing and rehab therapy services. Let’s take a look at the changes and how they may affect you or a loved one with Medicare.

How It Was Before

First of all, let’s define the terms. The changes we’re discussing are grouped under the category of “skilled nursing care.” That term covers home health and nursing home care. It also includes outpatient therapy services, such as occupational therapy, physical therapy and speech-language pathology services.

Before 2013, Medicare’s policy was to cover skilled nursing care only under certain circumstances. As a patient, you had to demonstrate that you were regaining or improving your ability to perform certain functions in order for Medicare to pay for your services. If not, you could continue receiving the services, but you had to pay for them out of pocket.

What’s Changed

In 2011, the Center for Medicare Advocacy and Vermont Legal Aid filed a lawsuit against Kathleen Sebelius, then Secretary of the U.S. Department of Health and Human Services (HSS). They filed on behalf of four Medicare patients and five national organizations, including the National Multiple Sclerosis Society, Parkinson’s Action Network and the Alzheimer’s Association. The lawsuit, Jimmo v. Sebelius,1 was settled in 2013. As part of the settlement, the HHS agreed to relax Medicare’s requirements for coverage of skilled nursing and therapy services in institutional or home care settings.

(For more information, please see the August 2013 Medicare Made Clear blog post “Denied Rehab Therapy Just Because Your Medical Condition is Not Improving?”)

As a condition of the settlement, in January of 2014, Medicare officials updated the agency’s policy manual. Any notion that improvement is necessary to receive coverage for skilled care has been removed. Per other conditions of the legal settlement, CMS has sent notification about the change in policy to a large audience, including health care providers, bill processors, auditors, Medicare Advantage plans and appeals judges.

Why It’s Important

It’s expected that the decision to remove the “improvement” requirement from skilled nursing and therapy services coverage will have a far-reaching effect on the quality of life for people with Medicare. Take, for example, someone with a disease like Parkinson’s or Alzheimer’s. You wouldn’t necessarily expect big improvement from therapy services like physical therapy or occupational therapy. But continuing to get those services might help you maintain your current condition and prevent further deterioration.

The Jimmo settlement may also help people with Medicare who want to avoid institutional care. That’s because it can sometimes cover services offered as a part of home care as well. But it’s also important for people who reside in nursing homes and receive care there.

What You Should Do

It’s important to educate yourself on this change in Medicare coverage practices, and make sure your health care providers know, too. Even after the official policy change and notification, some medical providers are still not aware of these Medicare coverage changes. You or a loved one may be denied coverage for the skilled nursing or therapy you need. If that happens, make sure you contact Medicare or your Medicare Advantage plan to appeal the denial, citing the change in Medicare coverage policy.

For more information, explore MedicareMadeClear.com or contact the Medicare helpline 24 hours a day, seven days a week at 1-800-MEDICARE (1-800-633-4227), TTY 1-877-486-2048.

1Jimmo v. Sebelius, No . 11-cv-17 (D.Vt.), filed January 18, 2011.


Jimmo v. Sebelius Settlement Agreement Program Manual Clarifications Fact Sheet: Posted on CMS.gov, website for the Centers for Medicare & Medicaid Services.

Medicare.gov: Information on therapy services coverage on the U.S. government’s official website for Medicare.

Medicare & You: The U.S. government’s official Medicare handbook, available online.

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