Understanding Place of Service Requirements Under Medicare Part B

Medicare Part A covers nursing home care for a beneficiary’s stay of up to 100 days in a skilled nursing facility (SNF). If nursing home care is still needed after the 100 days or the beneficiary did not qualify for a Part A SNF stay, Medicare Part B may provide coverage for certain medical and other health care services. However, Part B does not pay for durable medical equipment (DME) provided during a nursing home stay unless the nursing home qualifies as the beneficiary’s home.   

Also, Medicare payment determinations for DME provided to residents of nursing homes are driven by whether the nursing home provides primarily skilled care or rehabilitation.

A nursing home qualifies as a beneficiary’s home only if it does not provide primarily skilled care or rehabilitation.

If the nursing home provides primarily skilled care or rehabilitation, DME is not covered. This noncoverage stems from the legal requirement that DME be used in a beneficiary’s home or an institution that can be considered a home. 

SNFs & Alternatives

The Social Security Act states that any nursing home meeting the basic definition of a SNF may not be considered a patient’s home for this purpose.

The Social Security Administration generally defines a “skilled nursing facility” as an institution or distinct part of one that: primarily provides skilled nursing care and related services for residents who require medical or nursing care or provides rehabilitation services for injured, disabled or sick people, and has a transfer agreement in effect. The full definition is available on the Social Security Administration website, ssa.gov. 

Thus, a nursing home can only be considered a beneficiary’s home and qualify for DME if it provides primarily a nonskilled level of care and few rehabilitation services.

Nursing homes that are certified Medicaid-only, called nursing facilities (NFs), or distinct parts of nursing homes (distinct part nursing homes) may qualify as a beneficiary’s home.

In contrast, no SNFs or dually certified nursing homes (those certified for both Medicare and Medicaid) qualify as a beneficiary’s home because they provide primarily skilled care or rehabilitation.

If a beneficiary resides in an NF or distinct part nursing home that does not provide primarily a skilled level of care or rehabilitation, the supplier should identify “home” as the place of service.

There are two exceptions in which Medicare pays for DME provided in nursing homes that do not qualify as a beneficiary’s home. The first is not discussed in detail here, which generally pertains to when the equipment was initially provided to the beneficiary at their home prior to admittance to a nursing home. The second is when equipment was provided to the beneficiary in anticipation of a discharge from a nursing home to their home. 

Delivery Before Discharge

Federal regulations and guidance state that acute care hospitals, long-term care hospitals, inpatient rehabilitation facilities, inpatient psychiatric facilities and critical access hospitals must directly furnish all inpatient services and DME, prosthetics, orthotics and supplies (DMEPOS) items during the stay or arrange for a supplier to furnish them. The facility includes those supplier items on its Medicare inpatient claims. Medicare makes no separate payments for individual items furnished during an inpatient stay.

In some cases, a supplier may deliver certain DMEPOS items to a facility not considered the beneficiary’s home before the patient is discharged. These items may include prosthetics or orthotics, but not supplies. Medicare allows (according to the Medicare Claims Manual, Chapter 20, Section 110.3.1) for this pre-discharge delivery when the items meet certain conditions: 

• The supplier delivers the item for training or fitting only and the beneficiary uses it after discharge in their home; 
• The supplier delivers the item no earlier than two days before discharge; 
• The supplier is not eliminating the inpatient facility’s responsibility to furnish the medically necessary item;
• The supplier can bill the claim to request payment after the facility discharges the beneficiary; or
• The beneficiary is discharged to a qualified place of service and not to another facility not qualified as the beneficiary’s home.

If you have questions regarding DMEPOS deliveries before discharge, you should consult with your health law attorney.