Does Medicare Pay for a Skilled Nursing Facility?

As a hospital social worker, I help patients and families get to a skilled nursing facility for rehab. Often times rehabilitation at an inpatient setting is recommended to help facilitate recovery. Skilled Nursing Facilities offer this type of setting. Most of my patients ask me “Does Medicare Pay for a Skilled Nursing Facility?”

I have a short answer and a long answer. And I always give both. The short answer is: “YES”. The long answer is…yes, but…

So now I’m about to give you a run down on the long answer. This is the answer I give ALL of my patients.

You can find more information about the different types of rehabilitation services on the post “Planning for Care After a Hospital Stay”.

What Medicare Pays For

So first off, I always identify what type of Medicare plan my patients have. In general it’s the same guidelines and answer, but there is a little more to how Insurance pays for a Skilled Nursing Facility stay. The differences will be between Traditional or Original Medicare versus a Medicare Advantage plan.

If you want a better understanding of Traditional/Original Medicare versus Medicare Advantage Plans, check out the post “What No One Tells You About Medicare Enrollment Period”.

After identifying which plan my patient has, here is the spiel I give…

So both Traditional Medicare and Medicare Advantage Plans will pay for the first 20 days at Skilled Nursing Facility at 100%. So essentially for 20 days, there is no cost to you (the patient).

If you need more than 20 days of rehab, Medicare will then pay 80% for up to 100 days. So, days 21-100, Medicare pays 80%, leaving you (the patient) with a 20% co-pay.

Doesn’t sound too bad right? Well, currently the 20% co-pay is set at $185.50 per day. Yes, PER DAY. This rate is set by the Centers for Medicare and Medicaid Services (CMS). You can see the rate on the website: Medicare.gov.

Scenario:

So let’s pretend that you find out that you are going to need rehab at a skilled nursing facility for a total of 30 days.

The first 20 days are at no cost to you. Now we have days 21-30 that will require the 20% copay of $185.50 per day. So out of pocket you are looking at a total cost for a 30 day stay at a skilled nursing facility of: $1,855.00.

Also, it’s important to note, that after the 20 days, skilled nursing facilities will let you know their recommendations of how much further therapy you will need. After that discussion you can decide if you want to forego their recommendations and go home, or pay that out of pocket cost.

Typically the skilled nursing facility will want you to pay that out of pocket cost up front. If you don’t utilize all of the days you paid for, they will refund you.

How You Can Help Get the Co-Pay Cost Covered

So, there is a way to get that 20% co-pay covered by insurance so you don’t have that out of pocket expense…

If you haven’t guessed it already, the answer is: More insurance!

There are Medicare Supplement Plans that are designed to help make up that gap between what Medicare actually pays for and any out of pocket expenses that are not covered. These Medicare supplement plans are also called Medicare Part F or Medicare Part G plans.

Some can be worth the extra monthly cost, especially if you already have a lot of health conditions. I would highly recommend looking into them. You can find more information about them at Medicare.gov: What’s Medicare Supplement Insurance (Medigap)?.

If you can’t afford the Medicare supplement plans, you can also find out if you qualify for Medicaid. Each state has a Medicaid program for Seniors, but there are certain income requirements that have to be met. To find out how to apply for Medicaid in your State, check out our resource: “Medicaid Programs by State“.

The Difference Between Traditional Medicare and Medicare Advantage Plans When Paying for Skilled Nursing Facilities

So, as I mentioned above, both Traditional Medicare and Medicare Advantage Plans will pay for the first 20 days of rehab at a skilled nursing facility.

However, there are 2 big differences between the plans in terms of how they pay for the care.

First, Medicare Advantage Plans require authorization by the plan in order for skilled nursing facility services to be paid for.

What does this mean?

This means that the medicare advantage plan goes through your medical records submitted by the skilled nursing facility to get approval for the skilled nursing facility to get paid by your insurance. The facility has to submit a request for authorization before admission, in addition to every few days for continued payment.

Essentially, this insurance plan dictates what kind of care you get and the duration of rehab you receive.

Second, if you sign up for a Medicare advantage plan, it automatically disqualifies you from being able to sign up for a Medicare Supplement plan to help cover copays.

This is because Medicare advantage plans offer various other services for a low to zero cost premium. It’s actually illegal for anyone to sell you a Medicare supplement plan if you have a Medicare advantage (medigap) plan. Advantage plans are supposed to help lower the cost of your out of pocket expenses and in return get paid by Medicare to do so.

The Bottom Line

Medicare DOES pay for skilled nursing facility rehabilitation, however, depending on your insurance plan you may have an out of pocket expense. It’s important to check with your insurance plan about what services are covered.