01-066 Schizophrenia in SNFs Notification of Medical Review

Noridian Healthcare Solutions, LLC, as the Supplemental Medical Review Contractor (SMRC) for the CMS, is conducting post-payment review of Medicare Part A Skilled Nursing Facility (SNF) claims billed on dates of service from January 1, 2020, through December 31, 2021. This notification includes the reasons for the review, documentation that will be requested in the Additional Documentation Request (ADR) letter, and resources providers/suppliers may wish to consult when submitting claims.


In May of 2021, the Office of Inspector General (OIG), published an issue brief (OEI-07-19-00490) titled “CMS Could Improve the Data It Uses to Monitor Antipsychotic Drugs in Nursing Homes.” OIG noted that in 2018, more than one in five Medicare long-stay nursing home residents aged 65 or over received an antipsychotic drug. While these drugs can be effective in treating a range of conditions, they must be prescribed appropriately.

OIG further noted that 2018 Minimum Data Set (MDS) data showed that there were 98,227 residents aged 65 and older whom nursing homes reported as having schizophrenia. Approximately 30% of these residents had no record of a schizophrenia diagnosis in any of their 2017 and 2018 Medicare Part A, B or C claims. Further data analysis done by CMS and the SMRC also identified a potential area of vulnerability.

Reason for Review

The SMRC is tasked with performing SNF medical review for beneficiaries with initial diagnosis of schizophrenia on antipsychotic medication from January 1, 2020, through December 31, 2021. The SMRC will conduct medical record reviews in accordance with applicable waivers/flexibilities/statutory, regulatory, and sub-regulatory guidance.

Claim Sample Detail

Type of Bill (TOB)
SNF Inpatient 21X


Diagnosis Codes Description
F20 Paranoid schizophrenia
F20.1 Disorganized schizophrenia
F20.2 Catatonic schizophrenia
F20.3 Undifferentiated schizophrenia
F20.5 Residual schizophrenia
F20.9 Schizophrenia, unspecified

Access related project details below.

Documentation Requirements

Below is a list of specific documentation requirements that will be included in each ADR to obtain the necessary documentation to perform the review. Documentation requested has been made specific to assist the provider in collecting and submitting pertinent information to decrease provider burden.

Providers/suppliers are requested to submit each of the Documentation Requirements outlined below, if and as applicable to the claim on review.

  1. Physician/Non-Physician (NPP) Admission Orders
  2. All records to justify and support the level of care received
  3. Documentation to support the medical necessity of service
  4. PT/OT/SLP Initial evaluation, plan of care, progress reports, treatment encounter notes, therapy minute logs, and discharge summary
  5. Documentation to support each of the Health Insurance Prospective Payment System (HIPPS) code(s) billed
  6. Documentation to support the Minimum Data Set (MDS) Assessments (i.e. hardcopy version of each MDS related to claim period under review (e.g., 5-day, interim, discharge and any off-schedule assessments)
  7. Documentation to support the look back period under review based on the Assessment Reference Date (ARD) (The look back period may fall outside of the dates of service under review. The documentation requested may include documentation 30-45 days prior to the dates of service (DOS) under review.)
  8. Medication Administration Record (MAR) documenting the quantity administered including dose, route, and frequency given during the Part A SNF stay
  9. Admitting diagnosis along with any diagnosis of comorbid disease
  10. Individualized treatment plan for psychiatric services with updates
  11. Initial psychiatric/psychological evaluation/mental status exam
  12. Documentation to support National Coverage Determination (NCD), Local Coverage Determination (LCD) and/or Policy Article
  13. Signature log or signature attestation for any missing or illegible signatures within the medical record (all personnel providing services)
  14. Advance Beneficiary Notice of Liability (ABN); if applicable
  15. Any other supporting documentation
  16. If medical record documentation is submitted via esMD: Beneficiary identification, date of service, and provider of the service should be clearly identified on each page of the submitted documentation
  17. PLEASE NOTE: It is the responsibility of the provider to obtain all documentation from the ordering/referring provider to ensure medical necessity criteria have been met


Title XVII of the Social Security Act (SSA)

  • SSA, 1812(a)(2)(A), (b)(2). Scope of Benefits
  • SSA, 1813(3). Deductibles and Coinsurance
  • SSA, 1814(2)(B). Conditions of Payment and Limitations on Payment for Services
  • SSA, Section 1815(a). Payment to Providers of Services
  • SSA, 1819(a)-(f). Requirements for, and Assuring Quality of Care In, Skilled Nursing Facilities
  • SSA, 1833(e). Payment of Benefits
  • SSA, 1861(a) (1-2), (h)-(j). Definitions of Services, Institutions, Etc.
  • SSA, 1862(a)(1)(A). Exclusions from Coverage and Medicare as Secondary Payer
  • SSA, § 1879(a). Limitation on Liability of Beneficiary where Medicare Claims are Disallowed
  • SSA, § 1888(e). Prospective Payment
  • SSA, § 1888(g). Skilled Nursing Facility Readmission Measure
  • SSA, § 1888(h). Skilled Nursing Facility Value-Based Purchasing Program
  • SSA, § 1893(b). Medicare Integrity Program
  • SSA, § 1899(f). Waiver Authority

Balanced Budget Act of 1997 (BBA), Public Law 105-33

  • BBA, § 4432(b). Prospective Payment for Skilled Nursing Facility Services

Title 42 of the Code of Federal Regulations (CFR)

  • CFR, § 20-409.27. Posthospital SNF Care
  • CFR, § 30-409.36. Requirements for Coverage of Posthospital SNF Care
  • CFR, § 15. Particular Services Excluded from Coverage
  • CFR, § 1. Introduction and General Rules
  • CFR, § 330-413.360. Prospective Payment for Skilled Nursing Facilities
  • CFR, § 5(a)(6). Sufficient Information
  • CFR, § 20. Requirements for Posthospital SNF Care
  • CFR, § 612. Waivers of Payment Rules or Other Medicare Requirements
  • CFR, § Requirements for States and Long-Term Care Facilities. Subpart B. Requirements for Long Term Care Facilities; and Subpart F. § 483.315. Specification of Resident Assessment Instrument

Internet-Only Manual (IOM), Medicare General Information, Eligibility and Entitlement Manual, Publication 100-01

  • Medicare General Information, Eligibility and Entitlement Manual, Publication 100-01, Chapter 1, General Overview. Section 10.1. Hospital Insurance (Part A) for Inpatient Hospital, Hospice, Home Health and SNF Services – A Brief Description; and Section 20. Administration of the Medicare Program
  • Medicare General Information, Eligibility and Entitlement Manual, Publication 100-01, Chapter 4, Section 40. Certification and Recertification by Physicians for Extended Care Services

IOM, Medicare Benefit Policy Manual (MBPM), Pub. 100-02

  • MBPM, Chapter (Ch.) 8. Coverage of Extended Care (SNF) Services Under Hospital Insurance
  • MBPM, Ch. 15, 250. Medical and Other Health Services Furnished to Inpatients of Hospitals and Skilled Nursing Facilities
  • MBPM, Ch. 16, General Exclusion from Coverage. 10. General Exclusion from Coverage; Section 20. Services not Reasonable and Necessary; and Section 110. Custodial Care

IOM, Medicare Claims Processing Manual (MCPM), Pub. 100-04

  • MCPM, Ch. 1, General Billing Requirements
  • MCPM, Ch. 6. SNF Inpatient Part A Billing and SNF Consolidated Billing
  • MCPM, Ch. 30 § 40 and 50. Advance Beneficiary Notice of Non-coverage (ABN)
  • MCPM, Ch. 30, Financial Liability Protections. 130.2. Prior Hospitalization and Transfer Requirements for SNF Coverage as Related to Limitation on Liability; § 130.3. Application of Limitation on Liability to SNF and Hospital Claims for services Furnished in Noncertified or Inappropriately Certified Beds

IOM, Medicare Program Integrity Manual (MPIM), Pub. 100-08

  • MPIM, 3. Verifying Potential Errors and Taking Corrective Actions
  • MPIM, Ch. 3 § Time Frames for Submission
  • MPIM, Ch. 3 § Additional Documentation Request Required and Optional Elements
  • MPIM, Ch. 3 § No Response or Insufficient Response to Additional Documentation Requests
  • MPIM, Ch. 3 § Documents on Which to Base a Determination
  • MPIM, Ch. 3 § Signature Requirements
  • MPIM, Ch. 3 § 3.3.3. Reviewing Claims in the Absence of Polices and Guidelines

Local Coverage Determination (LCD)

  • LCD L35008 Non-Covered Services. Effective October 1, 2015 (Retired June 30, 2020)
  • LCD L36219 Non-Covered Services. Effective October 1, 2015 (Retired June 30, 2020)

Local Coverage Article (LCA)

  • LCA A55503 Skilled Therapy Services in the SNF PPS Setting. Effective October 23, 2015.
  • LCA A55505 Skilled Therapy Services in the SNF PPS Setting. Effective October 23, 2015.


Last Updated Jun 8, 2022