Skilled Nursing Facility 3- Day Rule Waiver
                     
Skilled Nursing Facility 3- Day Rule Waiver
CMS is waiving the requirement at Section 1812(f) of the Social Security Act for a 3-day prior hospitalization 
for coverage of a skilled nursing facility (SNF 3- Day Rule Waiver) stay provides temporary emergency 
coverage of SNF services without a qualifying hospital stay, for those people who need to be transferred as a 
result of the effect of a disaster or emergency. In addition, for certain beneficiaries who recently exhausted 
their SNF benefits, it authorizes renewed SNF coverage without first having to start a new benefit period. 
Second, CMS is waiving 42 CFR 483.20 to provides relief to SNFs on the timeframe requirements for Minimum 
Data Set assessments and transmission.
Background of Skilled Nursing Facility 3-Day Rule Waiver
Under the Shared Savings Program, the Centers for Medicare & Medicaid Services (CMS) enters into a 
participation agreement with each participating Accountable Care Organization (ACO). CMS will reward eligible 
ACOs when they lower growth in Medicare Parts A and B fee-for-service (FFS) costs (relative to their ACO-
specific benchmark) if, at the same time, they meet performance standards on quality of care.
www.medicalbillersandcoders.com Follow us:
Skilled Nursing Facility 3- Day Rule Waiver
The SNF 3-Day Rule Waiver waives the requirement for a 3-day inpatient hospital stay prior to a Medicare-
covered, post-hospital, extended-care service for eligible beneficiaries. Only Shared Savings Program ACOs that 
are currently participating in, or applying to, certain Shared Savings Program performance-based risk tracks 
have the opportunity to apply for a waiver of the SNF 3-Day Rule, and they must apply separately for the 
waiver during the annual application process.
To apply for an SNF 3-Day Rule Waiver, ACOs must:
• Meet specific eligibility criteria;
• Submit an SNF Affiliate List;
• Submit sample SNF Affiliate Agreement(s);
• Complete the SNF Affiliate Agreement table in the ACO Management System (ACOMS);
• Submit an executed SNF Affiliate Agreement for each proposed SNF affiliate; and
• Submit a communication plan, beneficiary evaluation and admission plan, and a care management plan.
www.medicalbillersandcoders.com Follow us:
Skilled Nursing Facility 3- Day Rule Waiver
Overview of the SNF 3-Day Rule Wavier
To support ACOs’ efforts to increase quality and decrease costs, CMS finalized a waiver of the SNF 3-Day Rule 
for eligible ACOs participating in certain performance-based risk initiatives of the Shared Savings Program (§ 
425.612). Eligible ACOs may apply for the use of an SNF 3-Day Rule Waiver during their agreement period or at 
the time of application to participate in the program. ACOs, including those applying for a waiver during the 
term of an existing participation agreement, must follow the annual application process. For PY 2019, SNF 3-
Day Rule Waivers are effective beginning July 1 following approval of an SNF 3-Day Rule Waiver Application. 
Applications for an SNF 3-Day Rule Waiver in subsequent years will have an effective date of January 1 of the 
performance year following approval. Once approved, an ACO will maintain its SNF 3-Day Rule Waiver for the 
remainder of its current participation agreement, unless CMS determines it is necessary to revoke the ACO’s 
waiver as provided in § 425.612(d)(3) or under the terms of the Track 1+ Model. If CMS or the ACO terminates 
the ACO’s participation agreement, the waiver ends on the date specified by CMS in the termination notice or 
on the effective date of termination, as specified in the ACO’s advance written notice to CMS required under § 
425.220.
www.medicalbillersandcoders.com Follow us:
Skilled Nursing Facility 3- Day Rule Waiver
It is important to note that an SNF 3-Day Rule Waiver does not create a new benefit or extend Medicare SNF 
coverage to patients who could be treated in outpatient settings or who require long-term custodial care. The 
waiver is intended to provide ACOs that are participating in certain performance-based risk tracks with 
additional flexibility to increase quality and decrease costs. The SNF benefit itself remains unchanged. The SNF 
3-Day Rule Waiver is only applicable for services furnished in SNFs that meet the eligibility requirements in § 
425.612, discussed below in Section 4.
The SNF 3-Day Rule Waiver does not restrict a beneficiary’s choice of provider or supplier. A beneficiary 
continues to have the option to seek care from any Medicare FFS provider or supplier, including from an SNF 
or other facility that is not an affiliate of an ACO that is participating in the Shared Savings Program. In such 
circumstances, normal Medicare requirements apply, including the requirement for a 3-day, inpatient 
hospitalization.
Applying for the SNF 3-Day Rule Waiver
Necessary steps to apply for an SNF 3-Day Rule Waiver include:
www.medicalbillersandcoders.com Follow us:
Skilled Nursing Facility 3- Day Rule Waiver
• Submit a Notice of Intent to Apply (NOIA) for an SNF 3-Day Rule Waiver.
• Submit an SNF 3-Day Rule Waiver Application.
Applicants must submit their applications through ACO-MS in accordance with the guidance provided on the 
Application Toolkit webpage. The Shared Savings Program Application Types & Timeline webpage contains an 
up-to-date list of all applicable deadlines. During the application process, ACOs receive multiple requests for 
information (RFI) notifications summarizing CMS’ review of submitted application information. ACOs should 
carefully review the RFIs sent by CMS because they only have a few opportunities to correct deficiencies 
identified in the submitted application information.
SNF 3-Day Rule Waiver Medicare Claims Processing
SNF waiver-approved ACOs must comply with all Medicare claims submission requirements, except the 
requirement for a 3-day inpatient hospital stay prior to a Medicare-covered, post-hospital, extended care 
service (42 CFR § 425.612(a)). An SNF 3-Day Rule Waiver does not change FFS billing requirements (other than 
the 3-day inpatient stay requirement). SNFs do not include any new data elements when submitting FFS claims
www.medicalbillersandcoders.com Follow us:
Skilled Nursing Facility 3- Day Rule Waiver
to indicate their intent to use an SNF 3-Day Rule Waiver. For institutional claims, CMS will set the 
Demonstration Number field to “77” for claims that meet all of the following conditions:
• Received” date on the claim is on or after January 1 of the calendar year indicated on the claim’s “From” 
date;
• A CCN (first 6 digits) is found on the claim that is also found on the ACO’s certified SNF Affiliate List;
• Beneficiary Health Insurance Claim Number (HICN) found on the claim which is also found on the ACO’s 
assignment list;
• The date of service “From” date on the claim is on or after the effective start date of a waiver; and
• The ACO ID (AXXXX) associated with the SNF affiliate is the same as the ACO ID associated with the eligible 
beneficiary.
If an SNF claim is rejected exclusively due to a lack of a qualifying hospital stay, meaning all other Medicare
 FFS coverage, claims processing, and other applicable requirements are met, the SNF should verify that the 
ACO, SNF, and beneficiary meet waiver eligibility requirements under § 425.612, described above. If the ACO, 
SNF, and beneficiary meet these eligibility requirements, the SNF should contact its MAC to inquire about 
payment for the claim pursuant to the terms of the SNF 3-Day Rule Waiver under the Shared Savings Program.
www.medicalbillersandcoders.com Follow us: