How Nursing Homes Can Avoid Medicare Billing Suspension Under CMS’s New Revalidation Rule

Skilled Nursing Facilities (SNFs) must navigate an increasingly complex regulatory environment, and the latest changes from the Centers for Medicare & Medicaid Services (CMS) are no exception. As part of its ongoing efforts to enhance transparency and oversight, CMS has updated Form CMS-855A, requiring SNFs to undergo an off-cycle revalidation by May 1, 2025.

Failure to comply with these new requirements could jeopardize Medicare billing privileges, disrupt cash flow, and force facilities into a costly reapplication process. Below, we break down what’s changing, how to stay compliant, and steps your facility should take now to avoid any billing suspensions.

Why the Change? Increased Scrutiny on SNF Ownership

CMS has intensified its focus on SNFs, particularly those owned or operated by private equity firms (PEs) and real estate investment trusts (REITs). CMS is concerned that some PE- and REIT-owned facilities prioritize short-term profits over patient care—often through staffing reductions and cost-cutting measures that may negatively impact quality.

To address these concerns, CMS has introduced stricter transparency rules that require SNFs to disclose more detailed information about ownership, financial relationships, and managerial control. The goal? To identify individuals and entities with a history of providing substandard care or engaging in fraudulent activity.

What’s Changing? Key Updates to Form CMS-855A

In October 2024, CMS revised Form CMS-855A to expand reporting obligations. The updated form now requires SNFs to provide:

Governing Body & Key Personnel: SNFs must report the name, title, and period of service for each member of their governing body, as well as officers, directors, members, partners, trustees, and managing employees.
Additional Disclosable Parties (ADPs): Facilities must disclose entities or individuals that:
- Control operations, finances, or management, including those setting policies or providing financial/cash management services.
- Lease or own at least 5% of the facility’s real property.
- Provide management, administrative, clinical consulting, or financial services to the facility.
Organizational Structure & Relationships: SNFs must outline the ownership and control structure of each ADP, including corporate officers, shareholders (5%+ ownership), LLC members/managers, general partners, trustees, and any other relevant individuals or entities.

For many facilities, these new requirements will mean gathering and disclosing information that was not previously required—making early preparation essential.

How to Stay Compliant: Steps SNFs Should Take Now

Conduct an Internal Audit - Review your facility’s ownership structure, management agreements, and vendor relationships to identify all individuals and entities that meet the expanded disclosure criteria.
Gather and Verify Required Documentation - Ensure that all necessary documentation—such as organizational charts, contracts with management companies, and agreements with clinical consultants—is up to date. Additionally, verify that Social Security Numbers (SSNs) and Tax Identification Numbers (TINs) for all reportable individuals are accurate.
Complete Form CMS-855A Accurately - Mistakes or omissions in the new disclosure requirements can lead to delays, denials, or even billing suspensions. Given the complexity of the updated form, facilities should double-check all entries before submission.
File Before the Deadline—Don’t Wait for CMS to Contact You - The new rules require SNFs to revalidate by May 1, 2025—waiting until CMS notifies you could put your facility at risk of non-compliance. Be proactive in filing your paperwork well in advance.

What’s at Stake? Consequences of Non-Compliance

Failing to meet the updated revalidation requirements can have serious financial and operational consequences, including:

Medicare Billing Suspension – If revalidation is not completed on time, CMS may deactivate your facility’s billing privileges, halting Medicare reimbursements.
Cash Flow Disruptions – Payment delays from Medicare can impact your facility’s ability to meet payroll and operational expenses.
Time-Consuming Reapplication Process – Once billing privileges are deactivated, re-enrollment can take months, delaying reimbursements and adding administrative burdens.

Final Thoughts: The Time to Act is Now

This is more than just a routine paperwork update—it’s a fundamental shift in CMS’s approach to SNF oversight. Facilities must provide unprecedented transparency into their ownership and financial structures, and any misstep could lead to billing disruptions and financial strain.

Mooradian Law can help. Our firm specializes in healthcare transactions, regulatory compliance, and navigating complex CMS requirements. We guide SNFs through revalidation, ensuring compliance while minimizing administrative burdens.

Is your SNF ready for the 2025 CMS revalidation process?

Let’s ensure your facility remains Medicare-compliant and financially secure.

📧 info@mooradian.law
📞 (734) 219-4890