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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. 
You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101. 
 
The rules state that all SNF Part A inpatient services are paid under a prospective payment system (PPS). This 
involves payment based on a Health Insurance Prospective Payment System (HIPPS) rate code. Under the new 
Patient-Driven Payment Model (PDPM), which is effective for services provided on or after 10/1/2019, the 
HIPPS code is structured differently, as a result of there being five case-mix adjusted rate components under 
the revised model. The first position represents the Physical and Occupational Therapy case-mix group. The 
second position represents the Speech-Language Pathology (SLP) case-mix group. The third character 
represents the nursing case-mix group. The fourth character represents the Non-Therapy Ancillary (NTA) case-
mix group. The fifth character represents the assessment indicator code. You can find this information in the 
Centers for Medicare and Medicaid Service (CMS), Internet-Only Manual, Medicare Claims Processing 
Manual, Chapter 6, Sections 10, 30, and 120. 
 
The rules say that active diagnoses are intended to code diseases that have a direct relationship to the residents 
current functional status, cognitive status, mood or behavior status, medical treatments, nursing monitoring, or 
risk of death. One of the important functions of the Minimum Data Set (MDS) assessment is to generate an 
updated, accurate picture of the residents current health status. You can find this rule in the Centers for 
Medicare and Medicaid Services (CMS) Resident Assessment Instrument (RAI) Version 3.0 Manual, Chapter 
3. 
 
The rules say that there are two look-back periods for active diagnoses. Diagnosis identification is a 60-day 
look-back period. Diagnosis status (active or inactive) is a 7-day look-back period. 
 
1. Identify Diagnoses: 
 
The disease conditions in this section require a physician-documented diagnosis (or by a nurse practitioner, 
physician assistant, or clinical nurse specialist if allowable under state licensure laws) in the last 60 days. Medical record sources for physician diagnoses include progress notes, the most recent history and physical, 
transfer documents, discharge summaries, diagnosis/problem list, and other resources as available. If a 
diagnosis/problem list is used, only diagnoses confirmed by the physician should be entered. 
 
2. Determine whether diagnoses are active: 
 
Once a diagnosis is identified, it must be determined if the diagnosis is active. Active diagnoses are ones that 
have a direct relationship to the residents current functional, cognitive, or behavior status, medical treatments, 
nursing monitoring, or risk of death during the 7-day look-back period. Do not include conditions that have 
been resolved, do not affect the residents current status, or do not drive the residents plan of care during the 7-
day look-back period, as these would be considered inactive diagnoses. You can find this rule in the Centers for 
Medicare and Medicaid Services (CMS) Resident Assessment Instrument (RAI) Version 3.0 Manual, Chapter 
3. 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.