SNF PDPM Audit Risk and Readiness

Federal oversight of PDPM is intensifying across the post-acute industry, and Skilled Nursing Facilities are preparing for a new era of heightened accountability. As Medicare Part A claims face deeper review, facilities must ensure that coding practices, documentation standards, and interdisciplinary workflows can stand up to regulatory scrutiny. In this environment, the strength of a facility’s therapy partnership matters more than ever.

HealthPRO Heritage helps SNFs stay ahead of this changing landscape with comprehensive PDPM expertise and an approach centered on compliance, accuracy, and operational stability. Our Operators and Clinical Reimbursement Consulting teams support precise Medicare coding and billing through

• Deep knowledge of PDPM logic
• ICD-10 assignment
• HIPPS accuracy

ensuring clinical complexity is appropriately represented. For partners in our Full Service and Management models, TeleMDS Hotline adds an essential layer of real-time support with RAC-CT credentialed RNs and clinical experts available by phone, email, or video to answer complex reimbursement questions quickly. Staff across all departments also benefit from exclusive educational content through PDPM University.

Our PDPM insulation road map:

• Strong documentation practices are fundamental to audit readiness. HealthPRO embeds documentation expectations into everyday workflows, focusing on demonstrating skilled need, capturing functional progress, and supporting medical necessity in defensible, auditor-ready language. These practices ensure that coding decisions align directly with the clinical narrative.

• Quality and compliance oversight must be ongoing, not reactive, especially as regulatory focus intensifies. HealthPRO provides internal audits, proactive compliance alerts, and AI-enhanced quality checks that identify risks early and ensure that issues are corrected before they become audit findings. This real-time visibility supports stable reimbursement and minimizes financial vulnerability.

• Education for the interdisciplinary team is also central to sustaining compliant operations. Our Clinical Strategies and Consulting teams train nursing, therapy, and administrative staff on current CMS guidance, emerging regulatory priorities, and best practices that improve accuracy and accountability across departments. With strong systems and a consistent focus on compliance, SNFs benefit from stabilized operations and significantly reduced exposure under PDPM contractor audits.

This level of support has never been more important, as federal auditors intensify their review of PDPM billing. The HHS Office of Inspector General (OIG) has initiated a new series of audits examining SNFs’ use of PDPM. The first released audit focused on a New York based SNF and found extensive issues including incorrect HIPPS code assignment, insufficient documentation to support medical necessity, and significant overpayments. Out of the 100 Medicare Part A claims that the OIG reviewed from 2020–2021, the auditors determined that 99 were noncompliant. The OIG extrapolated this to estimate over $31 million in overbilling. The SNF operator has disputed these findings, emphasizing the extraordinary conditions during the early COVID-19 public health emergency, when CMS had relaxed certain requirements and residents presented with unusually high acuity.

Even as this case continues to unfold, the implications for SNFs nationwide are clear: PDPM compliance must be precise, defensible, and consistently applied. More OIG audits are already underway, and facilities must be fully prepared with proactive PDPM processes.

Bottom line: In this new era of PDPM oversight, SNFs need a therapy partner who brings regulatory expertise, clinical excellence, and unwavering commitment to compliance. HealthPRO Heritage equips facilities with the tools, training, and real-time support required to navigate audits with confidence and protect reimbursement integrity.

Written By: Elisa Bovee, VP of Clinical Strategies, HealthPro Heritage