SNF Consolidated Billing in 2026: How to Stop Revenue Loss on “Excluded” Service

What happens when a service provided to a skilled nursing facility resident is billed the wrong way?

In many cases, it results in denied claims, delayed payments, or revenue that is never recovered. As SNF consolidated billing rules continue to evolve in 2026, correctly identifying and billing excluded services has become one of the most critical factors in protecting facility revenue.

SNF consolidated billing requires facilities to submit a single claim for most services provided during a covered Medicare Part A stay. Though this bundled approach simplifies payment, it also creates risk when certain specialized services are mistakenly included in the bundle. These excluded services must be billed separately to Medicare Part B, and even minor classification errors can lead to a significant financial impact.

This blog will talk about which services are excluded from the bundle and the steps facilities can take to avoid revenue loss in 2026.

What Are “Excluded” Services Under SNF Consolidated Billing?

Under SNF consolidated billing, most services provided during a covered Part A stay are bundled into a single claim submitted by the facility. However, certain services are classified as “excluded” as they involve specialized expertise, advanced technology, or high-cost care that falls outside routine SNF services. These excluded services must be billed separately to Medicare Part B by the provider who furnishes them. As a result, accurate identification and coordinated billing play a key role in protecting revenue.

• Physician Professional Services

Physician professional services are excluded from consolidated billing as they represent direct medical decision-making and patient management. Though the professional component is billed separately under Part B, the technical component of related services may still be included in the SNF payment. This distinction makes it essential to separate professional services from facility-based components clearly.

• Dialysis and Related Services

Dialysis services provided to residents with end-stage renal disease are excluded as they require specialized equipment and care beyond standard SNF capabilities. These exclusions also extend to specific ambulance transports associated with receiving dialysis treatment. In such cases, the dialysis provider or transport supplier is responsible for billing Medicare Part B directly.

• Ambulance Services

Certain ambulance services fall outside consolidated billing when the transport is not part of routine SNF care. This includes ambulance trips for the resident’s initial admission, final discharge, or travel specifically to receive another excluded service. As these transports are linked to excluded care, the ambulance supplier must submit the claim to Part B rather than the SNF.

• Chemotherapy and High-Cost Drugs

Chemotherapy drugs and their administration are excluded due to their complexity, cost, and specialized handling requirements. These services typically involve external providers and advanced clinical oversight. As a result, they are billed separately under Medicare Part B and should not be included in the SNF’s bundled claim.

• Radioisotope and Radiation Therapy Services

Radioisotope and radiation therapy services are excluded as they rely on highly specialized technology and are generally provided outside the SNF setting. As these treatments are not part of routine nursing facility care, the rendering provider bills Medicare Part B directly to ensure proper reimbursement.

• Customized Prosthetic Devices

Customized prosthetic devices are excluded when they are individually designed for a specific patient and not commonly furnished by SNFs. These items require specialized fabrication, fitting, and clinical expertise. As a result, they are billed separately to reflect the unique nature of the service provided.

• Practitioner Types Added to the Exclusion List

The recent policy updates have expanded the list of practitioner services excluded from consolidated billing. In fact, the services provided by professionals such as mental health counselors and marriage and family therapists now fall outside the SNF bundle. Therefore, these practitioners must bill Medicare Part B directly for services delivered to SNF residents.

Key Strategies to Stop Revenue Loss

Stopping revenue loss under SNF consolidated billing depends on having the right processes in place from the start. As excluded services follow different billing rules, facilities must focus on early identification, clear responsibility, and accurate follow-through. In fact, they reduce errors, prevent denials, and support timely reimbursement when these strategies work together.

• Use the Latest CMS Exclusion Lists

Staying current with exclusion lists helps ensure billing decisions are based on the most recent guidance. As HCPCS codes evolve over time, integrating updated lists into billing systems helps ensure accurate service classification. As a result, facilities can avoid using outdated codes that may lead to improper bundling.

• Implement Real-Time Exclusion Flagging in Workflow

Real-time flagging enables excluded services to be identified as care is ordered or reviewed for billing purposes. In fact, staff can assign billing responsibility correctly before a claim is created when systems highlight these services early. This approach reduces rework and lowers the risk of payment delays.

• Clear External Provider Communication

Strong communication with external providers helps prevent confusion around billing roles. When specialists and transport suppliers understand that certain services must be billed directly to Medicare Part B, claims are submitted the first time correctly. This clarity also supports smoother coordination between the SNF and outside providers.

• Strong Internal Documentation and Coding Practices

Clear documentation supports accurate billing by explaining why a service qualifies as excluded. As a result, clinical notes should align with coding details to reflect the care provided. Therefore, the claims are more likely to be processed without issues when documentation and coding work together.

• Routine Audits and Internal Reviews

Regular reviews allow facilities to identify billing errors before they affect revenue. In fact, teams can spot patterns that need attention by checking claims for correct service classification. As a result, these reviews help strengthen internal controls and improve billing accuracy.

• Training for Billing and Clinical Staff

Consistent training ensures staff understand how excluded services differ from bundled care. When billing and clinical teams share the same knowledge, decisions are made more confidently and consistently. This shared understanding supports compliance and protects reimbursement.

Role of 24/7 Medical Billing Services

Stopping revenue loss under SNF consolidated billing requires more than basic claim submission. It demands accurate identification of excluded services, correct coding, and timely Medicare Part B billing. 24/7 Medical Billing Services supports skilled nursing facilities by managing these complex requirements with specialized billing and coding expertise. In fact, their team helps ensure excluded services are identified early and billed correctly by aligning workflows with the latest consolidated billing rules for reducing denials and missed reimbursement.

Beyond accuracy, 24/7 Medical Billing Services strengthens coordination and compliance across the billing process. The team supports clear communication with external providers, reinforces documentation standards, and conducts proactive claim reviews to catch errors before submission. This end-to-end approach helps SNFs maintain compliance, improve cash flow, and stay protected against revenue leakage as consolidated billing requirements evolve in 2026.

FAQs

Does consolidated billing apply to long-term care residents?

No, consolidated billing rules apply only during a covered Medicare Part A stay.

What happens if an external provider bills the SNF incorrectly?

The SNF may absorb the cost if the claim cannot be corrected in time.

Can billing software prevent consolidated billing errors?

Updated systems can flag excluded services before claims are submitted.

Do excluded services increase audit risk for SNFs?

Incorrect handling of excluded services can raise compliance and audit concerns.