Jimmo v. Sebelius Settlement Fact Sheet

CMS has issued a fact sheet on the Jimmo v. Sebelius settlement agreement. The settlement puts an end to the Medicare contractors inappropriately applying an “Improvement Standard” in making claims determinations for Medicare coverage involving skilled care. The fact sheet is the first of several education initiatives CMS will be undertaking in the coming months. In addition, CMS will be revising the program manuals used by the Medicare contractors.

In the case of Jimmo v. Sebelius, the Center for Medicare Advocacy (CMA) alleged that Medicare claims involving skilled care were being inappropriately denied by contractors based on a rule-of-thumb “Improvement Standard”— under which a claim would be denied due to a beneficiary’s lack of restoration potential, even though the beneficiary did in fact require a covered level of skilled care in order to prevent or slow further deterioration in his or her clinical condition.

While an expectation of improvement would be a reasonable to consider when evaluating, for example, a claim in which the goal of treatment is restoring a prior capability, Medicare policy has long recognized that there may also be specific instances where no improvement is expected but skilled care is required in order to prevent or slow deterioration and maintain a beneficiary at the maximum level of function. For example, a home health patient that’s requires the skills of a therapist to perform a therapy maintenance program, or a patient with a chronic wound that requires skilled nursing intervention.

A beneficiary’s lack of restoration potential cannot, in itself, serve as the basis for denying coverage, without regard to an individualized assessment of the beneficiary’s medical condition and the reasonableness and necessity of the care. Conversely, coverage would not be available in a situation where the beneficiary’s care needs can be addressed safely and effectively through the use of non-skilled personnel.

It is important for providers to understand that the settlement agreement does not alter or expand coverage criteria under the Medicare benefit, but clarifies that when skilled services are required to provide reasonable and necessary care to prevent or slow deterioration in a patient’s condition, coverage cannot be denied because there is no expectation for improvement.

CMS will be providing education for all stakeholders, such as issuing program transmittals and Medlearn Matter articles. In addition, national conference calls will be conducted with providers and suppliers, Medicare contractors, medical reviewers, Administrative Law Judges, and agency staff.

View the fact sheet here