CMS issues new condition code for home health claims

The Centers for Medicare and Medicaid Services (CMS) has added a new condition code that will allow home health claims for subsequent episodes to process, even if skilled nursing services are not required. The change takes effect July. 1

Currently, any home health claim that is submitted without skilled nursing visits are automatically returned to the provider. However, there may be instances when the home health agency is prevented from delivering skilled services planned for an episode, such as an unexpected inpatient admission. Condition code 54 is designed to streamline this claims process for both the payer and the provider.

Sections 1814(a)(2)(C) and 1835(a)(2)(A) of the Social Security Act requires that a beneficiary have a skilled need in order to be eligible to receive Medicare home health services. The need includes intermittent skilled nursing services, physical therapy and or speech language pathology services, or have a continuing need for occupational therapy services.

It’s important to note that if the claim is filed without the new condition code it will be returned, at which point the home health agency can: (a) add omitted skilled services to the claim; (b) submit the claim as non-covered, when appropriate, or (c) add the new condition code.

These actions will prevent unnecessary reviews and denials for the home health agency and allow Medicare to better target medical review resources.

It is important that your billing staff be made aware of the change. If you have any questions regarding the change, please contact our office at 305 358-4500 or email us at

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The Health Law Offices of Anthony C. Vitale