Home Health Notice of Admission: 5-Day Rule and Penalty

A home health notice of admission tells Medicare that a patient has started home health care with your agency. It must be accepted within 5 calendar days after the start of care, and a late one reduces payment in a way the patient cannot be billed for. This guide covers when the notice is due, what it contains, how the late penalty is calculated, the exceptions, and how to cancel or correct one. It is general education about Original Medicare.

What is a home health notice of admission?

A notice of admission is a one-time submission, type of bill 032A, that an agency sends to its Medicare Administrative Contractor (MAC) when a patient is admitted. It establishes that the patient is under a Medicare home health period of care and triggers home health consolidated billing edits (Benefit Policy Manual, chapter 7, section 10.4).

Once the notice is processed, Medicare opens an admission period and the agency can submit a claim for each 30-day period of care in it. A period claim submitted before a notice has been received is returned to the provider (Claims Processing Manual, chapter 10, sections 10.1.10.3 and 40.2).

Why did the notice of admission replace the RAP?

For periods of care starting on or after January 1, 2022, agencies no longer send a Request for Anticipated Payment (RAP); they send one notice of admission instead (MLN Matters MM12256). CMS said phasing out RAP payments would help mitigate potential fraud, and that a one-time notice would reduce paperwork while protecting the Medicare trust funds (CMS fact sheet). There is no upfront payment with the notice (Benefit Policy Manual, chapter 7, section 10.4).

When is the notice of admission due?

The notice must be submitted to and accepted by the MAC within 5 calendar days after the start of care (42 CFR 484.205(j); Claims Processing Manual, chapter 10, section 10.1.10.3). The start of care is day 0, and the five days are counted starting the day after it (CGS). These are calendar days, so weekends and holidays count.

In CMS's example, with a start of care of January 1, a notice submitted on or before January 6 is timely and one submitted on January 7 or later triggers the penalty (Benefit Policy Manual, chapter 7, section 10.4). For a start of care on March 2:

When can you submit a notice of admission?

Only after the physician's or allowed practitioner's written or verbal order for the initial visit services has been received and documented, and the initial visit has been made and the patient admitted (42 CFR 484.205(j)(2)). The notice cannot go out before the first visit, so the 5-day clock is already running when it can first be sent.

What information goes on a notice of admission?

The notice is short, but every required field has to be right. Section 40.1 of the Claims Processing Manual, chapter 10 lists:

• Agency name, city, state, ZIP code and billing NPI
• Type of bill 032A
• From and Through dates, both the date of the first visit in the admission
• Admission (start of care) date, matching the From date
• Patient name, mailing address, birth date and sex
• Insured's name as shown on the Medicare card, and the Medicare Beneficiary Identifier (MBI)
• Release of information indicator
• Name and identifier of the attending physician who established the plan of care
• Condition code 47, only for a transfer from another agency
• Principal diagnosis code, required for the electronic 837I format

The manual advises confirming the MBI is active with an eligibility inquiry first, since an MBI with an end date is not valid after that date (section 10.1.10.3). The diagnosis on the notice does not have to match the first period claim, and HIPPS code 1AA11 is a placeholder used only on 837I submissions (Palmetto GBA).

Does every 30-day period need a notice of admission?

No. One notice covers every contiguous 30-day period from admission until discharge, so recertifications do not need a new one (42 CFR 484.205(j)(1)). After a discharge has been reported to Medicare, a new notice is required before any more claims (Claims Processing Manual, chapter 10, section 10.1.10.3). Common situations, from the same chapter:

• Hospital or nursing facility stay. The agency does not have to discharge. If it does not and the patient returns within the same 30-day period, that period continues (section 10.1.14).
• Discharge and readmission to the same agency in the same 30 days. The first period's payment is prorated, and the agency sends a new notice to open a new admission period. The next period starts on the first visit after readmission (section 10.1.14).
• Transfer from another agency. The receiving agency submits its notice with condition code 47. Medicare closes the first agency's admission period as of the date services began at the new agency and prorates the first agency's last claim. The receiving agency must document that it checked a Medicare inquiry system and contacted the first agency (section 10.1.13).
• Medicare Advantage to Original Medicare. Submit a notice using the first visit after the Original Medicare effective date as the From date (section 10.1.23).

What happens if the notice of admission is late?

Medicare reduces the payment. It does not pay for the days from the start of care to the date the notice is filed, and the wage and case-mix adjusted 30-day period payment is reduced by one thirtieth for each of those days (42 CFR 484.205(j)(3)). The manual counts days until the notice is submitted to and accepted by the MAC. In addition:

• The reduction includes any outlier payment.
• No low utilization (LUPA) per-visit payments are made for visits on days before the notice was submitted.
• The reduction cannot exceed the total payment of the claim.
• The non-covered days are the agency's liability, and the patient must not be billed for them.
• The claim shows the reduction as value code QF, the amount the payment was cut because the notice was filed more than 5 days after the From date.

(42 CFR 484.205(j)(3); Claims Processing Manual, chapter 10, section 10.1.10.3 and value codes)

A late notice can reach past the first 30 days. When it does, each period it spans is subject to the reduction (CGS).

How is the late penalty calculated?

CMS's formula is R = (d / 30) x P, where d is the number of calendar days from the start of care until the notice is submitted and P is the case-mix and wage adjusted 30-day period payment. In CMS's examples, a notice submitted 6 days after the start of care (one day late) cuts the payment by 20 percent, and one submitted 30 days after (25 days late) cuts it by 100 percent (CY 2020 home health final rule, 84 FR 60478). Each extra day costs about 3.3 percent of the period.

Worked example. The start of care is March 2 and the notice is accepted on March 11, 9 days later, so the reduction is 9/30, or 30 percent. If the period payment were $3,000 (a made-up figure, not a Medicare rate), the reduction would be $900 and the period would pay $2,100. The $900 cannot be billed to the patient. Accepted by March 7, the same notice would have cost nothing.

Are there exceptions to the late penalty?

Yes, but they are narrow. An exception waives the penalty in four circumstances (Claims Processing Manual, chapter 10, section 10.1.10.3; 42 CFR 484.205(j)(4)):

1. Fires, floods, earthquakes or other unusual events that inflict extensive damage on the agency's ability to operate
2. A CMS or MAC systems issue, beyond the agency's control, that causes a filing problem
3. A newly certified agency notified of its certification after the certification date, or still waiting for its user ID from the MAC
4. Other circumstances the MAC or CMS determines were beyond the agency's control

Delays inside Medicare's systems can qualify. If a notice sent on time held an inadvertent error, such as a recently changed beneficiary identifier, Medicare may not return it right away. The MAC grants an exception when the agency documents when the notice was submitted, when it was returned or available for correction, and that it was resubmitted within two business days (or an accepted notice was cancelled within two business days and the new one sent within two business days after the cancellation finalized). Exceptions are not granted for MBI changes the agency could see more than two weeks before admission (section 10.1.10.3).

How to request an exception

Request it on the period claim: append modifier KX to the HIPPS code on the revenue code 0023 line and explain the circumstances in Remarks. If the remarks are not sufficient, the MAC may return the claim or ask for documentation, such as screen images of the Medicare systems screens that show the dates. A late notice that spans several periods needs the exception requested on each claim. CGS says not to file an appeal, because the exception process is the required action (CGS; chapter 10, section 10.1.10.3).

When the agency learns late that a patient left a Medicare Advantage plan, Palmetto GBA's example is KX with the remark "CR12256 disenroll MA" plus the date plan coverage ended. For a known Medicare system issue, use the exact remarks the MAC publishes (Palmetto GBA).

When exceptions are not granted

• The agency made no attempt to file on time and none of the four circumstances applies.
• The agency could have corrected the notice without waiting for Medicare systems.
• A partial notice was submitted just to meet the deadline.
• An agency with multiple provider identifiers used one for a location that did not provide the service.

How do you cancel or correct a notice of admission?

Cancel it with type of bill 032D, then submit a corrected 032A. Any claims already filed under that admission must be cancelled first, because claims cannot stay on file without a processed notice; once the corrected notice processes, they can be submitted again (CGS).

Cancel and resubmit for a wrong Admission, From or Through date, or the wrong beneficiary, and send the corrected notice within two business days of cancelling. If the original was on time, say in the period claim's Remarks that a timely notice was cancelled and resubmitted, and append KX to the HIPPS code on the 0023 line (Palmetto GBA).

Do not cancel a notice, timely or not, for any of these (same source):

• A change in principal diagnosis. It does not have to match the claim.
• A change of physician or practitioner. Report the correct one on the claim.
• A HIPPS code that differs from the claim. There is no matching requirement.

Notice of admission checklist

1. Before admission, confirm the MBI is active and the patient is in Original Medicare.
2. Confirm the order for the initial visit services is received and documented.
3. After the first visit, submit 032A with From, Through and admission dates equal to the first visit date.
4. Get it accepted by day 5, counting the start of care as day 0. Do not wait for the last day.
5. For a transfer, add condition code 47 and document the inquiry and the call to the first agency.
6. Confirm acceptance. If it comes back, correct and resubmit at once, and keep dated proof of each step.
7. Send no new notice for a recertification; send one after a reported discharge.
8. If a notice was late, see whether an exception applies, request it on every affected claim, and never bill the patient for the reduction.

A billing company can submit each notice of admission inside the window, confirm it was accepted, and keep the dated records an exception request needs. The agency still has to supply the order, the first visit date and correct patient details on time.

Related guides

See Medicare home health billing for how periods, certification and deadlines fit together, and why home health claims come back for returned claims and how to fix them. If you are weighing outside help, read choosing a home health billing company. For what LMNS covers, see home health billing services. More guides: home health billing codes for bill types, HIPPS, G-codes and claim codes, and billing for a new home health agency for the path from license to first Medicare claim.

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