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ALJ/MAC Decision Database



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A Quick Screen To Aid In Identifying Coverable Cases


Medicare claims for inpatient rehabilitation hospital are suitable for appeal if they meet the following criteria:

  • The patient's physician certifies that inpatient hospitalization for rehabilitation is medically necessary.

  • The patient requires a relatively intense, multidisciplinary rehabilitation program.

  • The rehabilitation program is provided by a coordinated, multidisciplinary team.

  • The goal of the rehabilitation program is to upgrade the patient's ability to function as independently as possible.

  • The care is provided in a Medicare certified facility.

Additional Hints: 

  • Ignore arbitrary caps on coverage imposed by the P.R.O. (Professional Review Organization). For example, don't accept assertions that Medicare coverage cannot be gained if the patient needs less than 3 hours per day of physical and occupational therapy, or that hospital rehabilitation for certain conditions (i.e. below the knee amputations or upper extremity paralysis) is not coverable. The Medicare statute and regulations include no such restrictions. In practice, administrative law judges will grant coverage if it can be shown that the patient needed a multidisciplinary, coordinated rehabilitation program provided by a team of professionals which was not actually available at a skilled nursing facility or on an outpatient basis.

  • It will be helpful to succeed on appeal if the patient needs close medical supervision (i.e. 24 hour a day availability of a physician and/or nurse with training or experience in rehabilitation).

  • The patient's attending physician is always the key to obtaining Medicare benefits. If possible, obtain a statement from the physician explaining why inpatient hospital rehabilitation is medically necessary and that the needed rehabilitation program is not actually available at a skilled nursing facility or on an outpatient basis.

  • Don't be satisfied with a Medicare determination unreasonably limiting coverage and don't allow the patient to forego medically necessary care. Appeal for the benefits the patient deserves. It will take some time but benefits will probably be won in the end.

The Inpatient Hospital Rehabilitation Benefit


Medicare coverage for hospitalization includes payment for the services generally available in a hospital; bed and board, nursing services and other related services, use of hospital facilities, medical social services, drugs, supplies, and equipment, diagnostic or therapeutic items or services and medical or surgical services provided by certain interns and residents. Section 1361 of the Medicare Act, 42 U.S.C. Section 1395x(e), specifically defines hospitals to include institutions which provide rehabilitation as well as care for an acute illness. Under this section of the Act hospitals are defined to include institutions which provide "therapeutic services for medical diagnosis, treatment and care of injured, disabled, or sick persons, or rehabilitation services for the rehabilitation of injured, disabled, or sick persons."


Coverage Criteria And Appeal Rights


There are certain requirements that must be met in order for a patient to receive Medicare coverage for inpatient hospital rehabilitation. These requirements include:

  • The physician must certify that the patient needs inpatient hospitalization for rehabilitation.

  • The hospital must be a Medicare certified facility.

  • The inpatient must require relatively intense, multi-disciplinary rehabilitation provided by a coordinated team of physical therapists, occupational therapists, speech language pathologists, nurses and/or other professionals supervised by a physician with experience or training in rehabilitation medicine.

  • The care must be reasonable and necessary and not actually available at a lower level of care.

Historically, the Medicare administration, has restrictively interpreted these coverage requirements and unfairly denied or limited coverage for patients with certain diagnoses (i.e. below the knee amputees) or with certain treatment plans (i.e. less than 3 hours per day of physical and occupational therapy). Coverage for inpatient hospital rehabilitation has, therefore, often been erroneously denied.

As described above, the appeal rights provided for hospital Medicare denials, including inpatient hospital rehabilitation, are extensive. Many cases appealed to "Reconsideration," the first level of appeal, are successful; most cases appealed to the second level, an administrative law judge hearing, result in winning additional benefits.




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