The Centers for Medicare & Medicaid Services (CMS) issued an update to improve payment accuracy for physician services provided in Skilled Nursing Facilities (SNFs) as detailed in the MLN Matters newsletter (MM13767), released on March 14, 2025. This update addresses billing requirements related to Place of Service (POS) codes 31 and 32, which physicians must use when submitting claims for services rendered in SNFs and nursing facilities (NFs). These changes will take effect on July 1, 2025, with implementation beginning on July 7, 2025.
Effective July 1, 2025, CMS requires physicians to use POS code 31 when providing services to Medicare Part A patients in SNFs, and POS code 32 for services in NFs or when SNF patients have exhausted their Part A coverage. This update aims to address non-compliance in POS code reporting, which has been linked to overpayments and payment inaccuracies.
Misclassifying the POS code (e.g., using POS 32 for patients with active Part A coverage) will result in claim rejection or adjustments to ensure payment accuracy. CMS emphasizes the importance of proper code usage to prevent overpayments and ensure accurate billing for physician services in these settings.
Providers are urged to inform their billing staff about these changes to ensure compliance and avoid payment issues when submitting claims for Medicare services in SNFs and NFs.
For further guidance, providers should refer to CR 13767, available through their Medicare Administrative Contractors (MACs).
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Compliance Perspective
Issue
CMS has issued updated guidelines regarding the use of POS codes 31 and 32 for physician services in SNFs and NFs. The new rules, effective July 1, 2025, require physicians to use POS 31 for services provided during a patient’s Medicare Part A stay in SNFs, and POS 32 for services rendered in NFs or for SNF patients who have exhausted their Part A coverage. Misclassifying the POS code can result in payment inaccuracies, overpayments, and claim rejections, which may negatively affect the facility’s reimbursement rates.
Discussion Points
- Review and update your facility’s billing policies and procedures to ensure compliance with the new POS code requirements. Specifically, ensure your policies clearly outline the distinction between POS 31 and POS 32 and specify when each code should be used. Update billing procedures to include the proper verification process for Medicare Part A coverage status for each patient.
- Provide training to billing and coding staff about the new POS code reporting requirements. Training should cover the differences between POS 31 and POS 32, including when to use each code based on the patient’s Medicare Part A coverage status.
- Conduct audits of Medicare claims to ensure that the updated POS code requirements are being consistently followed. This includes reviewing claims submitted for accuracy, checking for the correct use of POS codes, and verifying that the Part A coverage status was properly assessed before coding. Implement a system for auditing claims before they are submitted to CMS, and address any discrepancies in a timely manner.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*
