The revenue you’re leaving on the table

For thirty years, the nursing home industry has quietly accepted the premise that this money belongs to someone else, but a new federal initiative is about to change the architecture of how those supplies are billed.

To understand why this matters, look at what happens in your building every day. A nurse walks into a resident's room carrying a catheter, a surgical dressing, or a bag of enteral nutrition. She administers the care. She logs the consumption in your Electronic Health Record. She washes her hands and moves to the next room. It is a perfectly ordinary clinical moment. But what happens next is structurally absurd.

Because that resident is a long-term care patient on Medicare Part B, the supply your nurse just administered will likely be billed to Medicare by an external DMEPOS supplier — a vendor who was not in the room, who did not administer the care, and whose only connection to the event is a login credential to your EHR. He bills Medicare Part B directly. He collects the reimbursement.

If you have been following federal healthcare policy, you have likely seen the acronym CRUSH. It stands for Comprehensive Regulations to Uncover Suspicious Healthcare, and it is the current administration's most aggressive anti-fraud initiative in a decade.

In February, CMS stopped $1.5 billion in DMEPOS billing alone. The Office of Inspector General has documented the structural vulnerability three times in the last decade, most recently finding $22.7 million in improper payments from a single restricted sample. The agency estimates the true national exposure at more than $400 million annually.

The reason the fraud persists is not a lack of enforcement. It is a structural problem: the entity billing for the supply has no clinical connection to the patient who received it. A claim generated by an external supplier cannot be verified against the facility's EHR, because the supplier does not own the EHR. The system pays on prediction, not on proof.

One of the proposals currently before CMS — submitted as part of the CRUSH initiative — is a framework called the Burst Model. The model asks the agency to formally endorse facility side billing for long-term care residents: the facility purchases supplies through a standard commercial distributor, the nurse logs the consumption in the EHR, and an authorized billing agent submits the Part B claim under the facility's own NPI. The claim is generated from the clinical record after the care has been documented. It cannot exist before the care does.

The case for CMS to act is unusually clean. The regulations are already on the books. When Congress passed the Balanced Budget Act of , it established the SNF Consolidated Billing requirement under Section (a) of the Social Security Act, making the skilled nursing facility the responsible billing entity for the care its residents receive. No new legislation is required. No multi-year CMS demonstration project. No appropriation. The agency would be endorsing a compliance pathway that already exists in statute — one that is already operating in facilities across the country — and directing the industry toward it.

The fraud reduction is structural rather than incremental. A claim tied to a documented clinical event cannot be fabricated by a supplier with a list of beneficiary numbers and a billing system. The phantom billing that currently costs Medicare hundreds of millions of dollars annually becomes, by the architecture of the model, impossible.

And the reimbursement returns to the facility where it was always intended to go. The revenue that has been flowing to external suppliers for three decades belongs, under the statute, to the operators who employed the nurses who administered the care. The legal authority to bill Part B for your long-term care residents already belongs to your facility. The statute says so.

Want to understand exactly how the CRUSH initiative will impact your facility?

Feel to reach out to me on LinkedIn or visit our website for more details.

Thanks for having me Kevin.

Forward this newsletter, and we might give them a free coffee for signing up!

Enjoy reading our newsletter? Forward this edition to a colleague and friend, and we will send five randomly selected new subscribers a free coffee using Thnks.

Thanks for reading. Have a wonderful day.

Kevin Goedeke, Publisher and Founder