IFR providers expect that the pandemic as well as new regulatory issues will impact their services.
2020 was certainly a historical year, punctuated by the COVID-19 pandemic and an overwhelming number of waivers and flexibilities for healthcare providers attempting to provide care amid chaos.
Those same providers were also required to maintain compliance with any existing and “un-waived” payer requirements, adding to provider stress. As we enter 2021, inpatient rehabilitation facilities (IRFs), along with all other healthcare providers, will be dealing with ongoing fallout from COVID-19, as well as the myriad of documentation and practice requirements that drive payment.
Recovery Audit Contractor (RAC) audits have resumed for IRFs, and while the number of charts requested is small, the impact can be significant. Despite prescribed limits to the number of charts that can be requested in any 45-day cycle and an annual limit of half of one percent, those limits may be adjusted upward based on low compliance rates. While all IRFs need to be prepared for these requests, small providers are at greater risk for high rates of non-compliance due to sample size, and they need to be certain they are responding promptly to these requests, and appealing denials if they occur.
COVID continues to have an impact on IRFs, as well as all sectors of the health delivery system, with no real end in sight. We have seen impacts on staffing – related to the U.S. Census, staff burnout, and staff illness – as well as bed capacity and throughput, and we expect those issues to continue.
The federal public health emergency (PHE) was recently extended for 90 days, from Jan. 21 until April 21, 2021. This means that the blanket waivers that impact providers will remain in place for this period, unless the Secretary of the U.S. Department of Health and Human Services (HHS) decides to end the PHE prior to that time. The waivers most pertinent to IRFs are the blanket waivers allowing for lower intensity of therapy services during the PHE, and those that allow for physicians to provide the required face-to-face visits via telehealth. Providers may continue to use these waivers. We advise our readers, however, to clearly document services to ensure that the record can be defended in future audits.
Additionally, IRFs continue to have the ability to utilize IRF beds for acute patients (and acute beds for IRF cases, when necessary) to meet surge demand. The waivers provide some relief for IRFs as they address the shift in IRF volumes that result from fluctuations in acute care and the need for post-COVID-19 rehabilitation for patients with significant debility. The ability to provide rehab in a safe and effective way, based on these shifts, is important for patient care and organizational success. We believe that IRFs should continue to explore opportunities for the provision of post-COVID-19 rehabilitation services as part of the solution to moving patients from acute care through the health continuum and on to home with improved functional abilities. Focused COVID-19 rehab programs have been shown to be big wins on all fronts: patients get much-needed care focused on functional recovery, IRFs maintain volume needed to remain open, and acute organizations are able to manage throughput by transferring patients to post-acute beds, effectively opening more acute beds for incoming patients.
Effective Oct. 1, 2020, the Centers for Medicare & Medicaid Services (CMS) allows the use of NPPs to provide one of the three required face-to-face visits in the second and later weeks of a patient’s stay. In audits for our clients, we have seen two separate issues:
The HHS Office of Inspector General (OIG) continues to review hospital claims based on four claim areas considered to be high risk for billing non-compliance, based on prior OIG findings. Those areas include inpatient claims billed with high-severity-level DRG codes, inpatient claims paid in excess of charges, IRF claims, and outpatient medical device claims. Large health systems appear to be more likely to be audited, based on the types of claims being targeted. Feedback from the field suggests that these reviews continue to have very high determinations of non-compliance.
Social determinants of health (SDoH) are likely to be of increasing importance in measurement of quality indicators, and IRFs should be preparing not only to be collecting data on SDoH, but planning for how they will mitigate the impact of these factors on ongoing success of the rehabilitation program and the consistency of rehabilitation outcomes. While implementation of the updated IRF-PAI components have been delayed, the focus on this area continues to grow, and IRFs’ responsiveness now may well be reflected in later success.
EDITOR’S NOTE: This article was originally published Monday, Dec. 8 by RACmonitor as a special bulletin. Many people are still seething mad about Aetna’s devious
Beginning in 2026, the Centers for Medicare & Medicaid Services (CMS) will begin phasing out the Inpatient-Only (IPO) List by removing predominantly musculoskeletal and complex
Please log in to your account to comment on this article.
Accurately determining the principal diagnosis is critical for compliant billing, appropriate reimbursement, and valid quality reporting — yet it remains one of the most subjective and error-prone areas in inpatient coding. In this expert-led session, Cheryl Ericson, RN, MS, CCDS, CDIP, demystifies the complexities of principal diagnosis assignment, bridging the gap between coding rules and clinical reality. Learn how to strengthen your organization’s coding accuracy, reduce denials, and ensure your documentation supports true medical necessity.
Denials continue to delay reimbursement, increase administrative burden, and threaten financial stability across healthcare organizations. This essential webcast tackles the root causes—rising payer scrutiny, fragmented workflows, inconsistent documentation, and underused analytics—and offers proven, data-driven strategies to prevent and overturn denials. Attendees will gain practical tools to strengthen documentation and coding accuracy, engage clinicians effectively, and leverage predictive analytics and AI to identify risks before they impact revenue. Through real-world case examples and actionable guidance, this session empowers coding, CDI, and revenue cycle professionals to shift from reactive appeals to proactive denial prevention and revenue protection.
Sepsis remains one of the most frequently denied and contested diagnoses, creating costly revenue loss and compliance risks. In this webcast, Angela Comfort, DBA, MBA, RHIA, CDIP, CCS, CCS-P, provides practical, real-world strategies to align documentation with coding guidelines, reconcile Sepsis-2 and Sepsis-3 definitions, and apply compliant queries. You’ll learn how to identify and address documentation gaps, strengthen provider engagement, and defend diagnoses against payer scrutiny—equipping you to protect reimbursement, improve SOI/ROM capture, and reduce audit vulnerability in this high-risk area.
Only ICD10monitor delivers what you need: updates on must-know changes associated with the FY26 IPPS, including new ICD-10-CM/PCS codes, CCs/MCCs, and MS-DRGs, plus insights, analysis and answers to your questions from two of the country’s most respected subject matter experts.
Get clear, practical answers to Medicare’s most confusing regulations. Join Dr. Ronald Hirsch as he breaks down real-world compliance challenges and shares guidance your team can apply right away.
Federal auditors are zeroing in on Inpatient Rehabilitation Facility (IRF) and hospital rehab unit services, with OIG and CERT audits leading to millions in penalties—often due to documentation and administrative errors, not quality of care. Join compliance expert Michael Calahan, PA, MBA, to learn the five clinical “pillars” of IRF-PPS admissions, key documentation requirements, and real-life case lessons to help protect your revenue.
During this essential RACmonitor webcast Michael Calahan, PA, MBA Certified Compliance Officer, will clarify the rules, dispel common misconceptions, and equip you with practical strategies to code, document, and bill high-risk split/shared, incident-to & critical care E/M services with confidence. Don’t let audit risks or revenue losses catch your organization off guard — learn exactly what federal auditors are looking for and how to ensure your documentation and reporting stand up to scrutiny.
Learn how to navigate the proposed elimination of the Inpatient-Only list. Gain strategies to assess admission status, avoid denials, protect compliance, and address impacts across Medicare and non-Medicare payors. Essential insights for hospitals.
Happy National Doctor’s Day! Learn how to get a complimentary webcast on ‘Decoding Social Admissions’ as a token of our heartfelt appreciation! Click here to learn more →
CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 1 with code CYBER25
CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 2 with code CYBER24
