CMS Close to Settlement in Class Action Lawsuit Alleging Inappropriate Payment Standards for Skilled Nursing and Therapy Services

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According to the New York Times, CMS is nearing a settlement in the class action lawsuit filed last year in Vermont alleging CMS and its contractors inappropriately deny Medicare coverage of skilled nursing and therapy services to beneficiaries whose conditions are no longer showing improvement or are considered medically stable.

According to the plaintiffs' complaint, conditioning payment for skilled nursing and therapy services on the expectation that the beneficiary's condition will improve is not supported by the Medicare statute or regulations. According to the New York Times article, CMS has agreed to change Medicare policies to allow payment for skilled nursing and therapy services needed to maintain a patient's condition or prevent or slow further deterioration.

The proposed settlement is likely welcome news to chronically ill patients and their health care providers who often see Medicare claims for skilled and therapy services denied once a patient's condition has hit a plateau despite the need for continued services to maintain the patient's condition.