Medicare SNF 3-Day Rule Billing & TEAM Model Waiver Update

CMS has revised its standard SNF 3-Day Rule Billing guidelines. The most critical update is the implementation of the Transforming Episode Accountability Model (TEAM) SNF 3-Day Rule Waiver.

‍

‍

*Discharging hospitals must clearly communicate the patient’s exact status, TEAM episode alignment, and eligibility to the receiving SNF during the stay and prior to discharge.

‍
**SNF admission and billing teams must cross-reference the CMS "Qualified SNFs" list and verify the hospital's TEAM model participation status before bypassing the traditional 3-day inpatient count.

Mandatory Beneficiary Eligibility Criteria:

‍
For the TEAM model waiver to apply, the beneficiary must meet all of the following requirements
at the time of SNF admission:

• Must have traditional Medicare Part A and Part B.
• Medicare must be the primary payer.
• Cannot be enrolled in a Medicare Advantage / managed care plan.
• Cannot have End-Stage Renal Disease (ESRD) as their basis for Medicare eligibility.
• Cannot be covered under a United Mine Workers of America health care plan.

‍

Facility & Compliance Requirements:

• Qualified SNF Status: The waiver applies exclusively if the receiving SNF or swing-bed provider is explicitly deemed "qualified" by CMS. CMS determines qualification via facility star ratings and publishes an updated list on the official CMS TEAM model webpage.
  ‍
• Hospital Participation: The discharging acute care hospital must be an active, designated participant in the TEAM model.
  
• Billing System Edits: Claims that do not meet the traditional 3-day rule and omit Demonstration Code A9 will be automatically rejected by Medicare claims processing edits. If a facility incorrectly bills a non-qualifying stay under standard rules, it faces potential overpayment recovery liabilities.

For additional information, please refer to TEAM 3 Day Rule