02/05/2026
CMS Improper Payment Report Flags Documentation Risks for SNF and Hospice Providers
The Centers for Medicare and Medicaid Services (CMS) released its annual Medicare Fee-for-Service supplemental improper payment data on January 24, identifying skilled nursing facilities and hospice providers as key drivers of improper payments.
What You Need To Know
- Skilled nursing facilities recorded an improper payment rate of 15%, representing approximately $4.5 billion, most often tied to insufficient documentation.
- Hospice providers saw about 6% of payments deemed improper, totaling roughly $2 billion, with unsupported medical necessity cited as the primary issue.
- Home health agencies had lower overall improper payments—about $1.1 billion—but documentation gaps remained the leading cause.
- CMS data showed California with the highest combined improper payment rate for home health and hospice at 12%.
What Happens Next
- The report reinforces CMS’ continued focus on fraud, waste, and abuse, with program integrity efforts expected to intensify across post-acute and long-term care settings.
- Providers should anticipate ongoing scrutiny of clinical documentation and eligibility determinations, particularly in SNF and hospice.
What to Do
- Review internal documentation practices to ensure records fully support coverage criteria and medical necessity.
- Strengthen interdisciplinary communication so assessments, care plans, and physician documentation align.
- Conduct focused audits in high-risk areas identified by CMS, especially admissions and recertifications.
The full findings are detailed in the CMS Medicare Fee-for-Service supplemental improper payment report.
