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ManinwheelchairFor years, it has been an article of faith that Medicare would not pay for services such as skilled nursing or physical therapy unless that care improved a patient's health status.

How did this misunderstanding go on for so long?

Learning all the ins and outs of Medicare benefits can leave beneficiaries and patients more than a little frustrated. Especially when there are misunderstandings among the facilities offering the care in question. Luckily, a landmark lawsuit a year ago brought attention to the blurred lines of coverage for rehabilitation services.

The landmark case was Jimmo v. Sebelius. Recently, Forbes explored the legal evolution Jimmo sparked in an article titled “When Medicare Will Pay for Skilled Nursing or Physical Therapy.

The salient change concerns one of the guiding principles of Medicare, or at least what has been the common wisdom for years. This principle is the so-called “improvement standard.” The idea was that Medicare would pay for skilled nursing care or physical therapy only when the patient’s health had the potential to improve. Accordingly, the payments would cease when there was no more improvement to be had.

Problem: skilled nursing and physical therapy are not necessarily just for curing a problem, but for managing it, especially among the elderly. Jimmo, however, provides that payment for these services will be made if they are “reasonable and necessary to prevent or slow further deterioration” and that benefits “cannot be denied based on the absence of potential for improvement or restoration.”

Real changes have been slow as providers test the waters, and all the other rules regarding skilled care are in place. Nonetheless, an apparent misunderstanding has been put to rest and an entire class of real beneficiaries and patients can now be assured of receiving benefits. Those previously denied benefits may even have the option of having their coverage re-reviewed.

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Reference: Forbes (January 31, 2014) “When Medicare Will Pay for Skilled Nursing or Physical Therapy