Updated on: March 23, 2020

COVID-19 Waivers: What It Means for IRFs

Original story posted on: March 18, 2020

On March 13, the Centers for Medicare & Medicaid Services (CMS) issued blanket waivers that will impact Inpatient Rehabilitation Facilities (IRFs) as well as other Post-Acute Care (PAC) settings. The blanket waivers, which do not require any special request to be filed, will allow IRFs to admit patients to IRF beds for emergency treatment of COVID-19, and to exclude these patients from the CMS 60-percent calculations. IRF patients may also be housed in other acute beds within the facility, if needed, to provide the appropriate response to increasing numbers of COVID-19 cases.

Medicare’s Emergency Declaration Fact Sheet, located on the CMS website at https://www.cms.gov/files/document/covid19-emergency-declaration-health-care-providers-fact-sheet.pdf provides details for all post-acute settings. Specifically:

  • “CMS is waiving requirements to allow acute-care hospitals to house acute-care inpatients in excluded distinct part units, where the distinct part unit’s beds are appropriate for acute-care inpatients. The Inpatient Prospective Payment System (IPPS) hospital should bill for the care and annotate the patient’s medical record to indicate the patient is an acute-care inpatient being housed in the excluded unit because of capacity issues related to the disaster or emergency.”
  • “CMS is waiving requirements to allow acute-care hospitals with excluded distinct part inpatient rehabilitation units that, as a result of a disaster or emergency, need to relocate inpatients from the excluded distinct part rehabilitation unit to an acute-care bed and The hospital should continue to bill for inpatient rehabilitation services under the inpatient rehabilitation facility prospective payment system for such patients, and annotate the medical record to indicate the patient is a rehabilitation inpatient being cared for in an acute-care bed because of capacity or other exigent circumstances related to the disaster or emergency. This waiver may be utilized where the hospital’s acute-care beds are appropriate for providing care to rehabilitation patients and such patients continue to receive intensive rehabilitation services.”
  • “CMS is waiving requirements to allow IRFs to exclude patients from the hospital’s or unit’s inpatient population for purposes of calculating the applicable thresholds associated with the requirements to receive payment as an IRF (commonly referred to as the “60-percent rule”) if an IRF admits a patient solely to respond to the emergency and the patient’s medical record properly identifies the patient as such. In addition, during the applicable waiver time period, we would also apply the exception to facilities not yet classified as IRFs, but that are attempting to obtain classification as an IRF.”

What This Means for IRFs

Flexibility in Patient Bed Assignment
When an organization has a requirement for beds that can be met by placing an acute patient in an IRF bed, the organization may proceed accordingly, provided that the case is clearly documented in the medical record. Conversely, if IRF beds are more appropriate for care of acutely ill patients, the IRF beds may be used for that purpose, and IRF patients may be treated in acute beds.

Billing Issues
These waivers provide organizations with flexibility in moving patients to and from open beds in order to ensure that needed care is provided. IRFs may house patients receiving acute care if appropriately designated in the medical record. CMS has posted additional policies and procedures related to this here:


As noted on page 31 of this document, IRFs should use condition code DR to note that the entire stay is disaster/emergency-related. This applies only to patients who are admitted to the IRF for non-IRF services.

Payment Issues
CMS has not indicated how claims admitted under the waivers will be paid, but historically, it has been under the IPPS payment systems.

Beware: IRF Requirements Still Apply
For admissions for IRF services that are not related to the disaster, the IRF must continue to meet all relevant requirements. 

Angela Phillips, PT

Angela M. Phillips, PT, is President and Chief Executive Officer of Images & Associates. A graduate of the University of Pennsylvania’s School of Allied Health Professions, she has more than 40 years of experience as a consultant, healthcare executive, hospital administrator, educator, and clinician. Ms. Phillips is one of the nation’s leading consultants assisting Inpatient Rehabilitation Facilities in operating effectively under the Medicare Prospective Payment System (PPS) and in addressing key issues related to compliance. Ms. Phillips is a member of the RACmonitor editorial board and a popular guest panelist on Monitor Mondays.

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