CurrentAnthemPolicy CG-REHAB-07

Skilled Nursing and Skilled Rehabilitation Services (Outpatient)

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This policy addresses when outpatient skilled nursing and skilled rehabilitation services are medically necessary for individuals requiring licensed clinical expertise and are not custodial in nature.

Policy Summary

PayerAnthem

PolicySkilled Nursing and Skilled Rehabilitation Services (Outpatient)

Policy CodePolicy CG-REHAB-07

Change TypeNo material clinical or coverage change

Effective DateOct 1, 2026

Last ReviewAug 13, 2026

Next Review DateN/A

Key ActionMaintain physician orders and documentation showing the skilled nature of the service, licensed personnel involvement, and why the service is not custodial.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

3Core skilled-service requirements

3Nursing criteria

8Rehabilitation criteria

2Not medically necessary categories

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CurrentAnthemPolicy CG-REHAB-07

Skilled Nursing and Skilled Rehabilitation Services (Outpatient)

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Sign up for Anthem Policy CG-REHAB-07 alerts

Get alerted when Policy CG-REHAB-07 changes without checking for updates manually.

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Policy Summary

PayerAnthem

PolicySkilled Nursing and Skilled Rehabilitation Services (Outpatient)

Policy CodePolicy CG-REHAB-07

Change TypeNo material clinical or coverage change

Effective DateOct 1, 2026

Last ReviewAug 13, 2026

Next Review DateN/A

Key ActionMaintain physician orders and documentation showing the skilled nature of the service, licensed personnel involvement, and why the service is not custodial.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

3Core skilled-service requirements

3Nursing criteria

8Rehabilitation criteria

2Not medically necessary categories

Illustrative skilled services

Medical Necessity Criteria

Outpatient Skilled Nursing Services

Outpatient skilled nursing services are medically necessary when all applicable conditions are met.

Skilled nursing medical necessity: The inherent complexity of the service requires performance safely and effectively only by or under the general supervision of skilled nursing personnel; the likelihood of change in the individual's condition requires skilled observation and assessment to identify treatment modification or additional procedures until the treatment regimen is essentially stabilized; and the service is not custodial in nature.

All three conditions are required.

Outpatient Skilled Rehabilitation Services

Outpatient skilled rehabilitation services are medically necessary when all of the following conditions are met.

Skilled rehabilitation medical necessity: The individual has a new acute medical condition or acute exacerbation of a chronic medical condition that has resulted in decreased functional ability such that adequate recovery cannot occur without therapy; the individual's overall medical condition and medical needs can be addressed in the outpatient setting; therapy is reasonable and necessary for the individual's condition, including the amount, duration, and frequency of services, and is directly and specifically related to an active written treatment plan developed by a physician and therapist; the individual's mental and physical condition prior to onset indicates potential for improvement or the services are necessary to establish a safe and effective maintenance program; the individual is medically stable enough to participate in the treatment plan; measurable functional improvement is expected within a reasonable and generally predictable period of time; the individual requires the judgment, knowledge, and skills of a licensed therapist; and the therapy includes a discharge plan.

All eight conditions are required.

Examples of Skilled Services

Examples of services that may qualify as skilled services when the applicable medical necessity criteria are met.

Illustrative skilled nursing services: Examples include intravenous, intramuscular, and subcutaneous injections; hypodermoclysis and intravenous feedings; initiation of nasogastric, gastrostomy, and jejunostomy feedings and continuous feedings associated with initiation; nasopharyngeal and tracheostomy aspiration; insertion, sterile irrigation, and replacement of selected catheters; application of dressings involving prescription medications and aseptic techniques; treatment of Grade 3 or worse decubitus ulcers or a widespread skin disorder; physician-ordered heat treatments requiring skilled observation; rehabilitation nursing procedures, including bowel and bladder training programs; ultrasound, shortwave, and microwave diathermy; initial phases of medical-gas or nebulizer regimens; and early postoperative colostomy care with associated complications.

This is an illustrative list, not an independent coverage pathway. The applicable medical necessity criteria must be met, and selected services require additional justification and documentation.

Custodial care—including assistance with activities of daily living or personal needs that does not require continuing attention or supervision by licensed medical or paramedical personnel—is not covered as skilled nursing or skilled rehabilitation under this guideline. Examples include assistance with walking, transfers, bathing, dressing, feeding, toileting, special-diet preparation, and supervision of medication that can usually be self-administered.

Stable continuous tube feedings beyond the initiation phase are not considered skilled services. Skilled service status may apply to initiation of nasogastric, gastrostomy, or jejunostomy feedings and to continuous feedings associated with initiation when medically necessary.

The presence of a urethral catheter placed for convenience or control of incontinence does not, by itself, justify skilled nursing care. Insertion or maintenance may support skilled nursing when the catheter is an adjunct to active treatment of urinary-tract disease, but that need must be reasonable, necessary, and documented in the medical record.

Outpatient skilled nursing services are not medically necessary when the applicable skilled nursing criteria are not met.

Outpatient skilled rehabilitation services are not medically necessary when the applicable skilled rehabilitation criteria are not met.

Documentation and Denial Prevention

Documentation Required

Document the Skilled-Service Foundation

Document that each outpatient skilled nursing or skilled rehabilitation service is furnished pursuant to physician orders, requires the skills of licensed technical or professional personnel, and is provided directly by or under their general supervision to ensure safety and achieve the medically desired result. The service must be medically necessary and noncustodial.

Qualified personnel include registered nurses, licensed practical or vocational nurses, physical therapists, occupational therapists, speech pathologists, and audiologists.
Record the physician order, skilled nature of the service, personnel involved, and direct provision or qualified general supervision.

Documentation Required

Support Nursing Medical Necessity

For outpatient skilled nursing, show that the service is inherently complex and can be performed safely and effectively only by or under the general supervision of skilled nursing personnel. Also document that the individual’s condition may change and therefore requires skilled observation and assessment to identify treatment modifications or additional procedures until the regimen is essentially stabilized.

Policy Purpose and Context

Outpatient skilled nursing and rehabilitation services are intended to provide medical treatment, recovery, prevention of deterioration, or maintenance of current capabilities when licensed clinical expertise is required. Services must be furnished pursuant to physician orders, require licensed technical or professional personnel, and be provided directly by or under their general supervision to assure safety and achieve the medically desired result. Personal assistance that does not require continuing licensed medical or paramedical attention is custodial care rather than skilled care.

Key Service Definitions

Custodial Care

Primary purposeAssistance with activities of daily living or personal rather than medical needs

Therapeutic statusNot specific therapy for an illness or injury and not skilled care

ExamplesAssistance with walking, getting in and out of bed, bathing, dressing, feeding, toileting, preparing special diets, and supervising medication that can usually be self-administered

Personnel requirementDoes not require continuing attention or supervision by trained, licensed medical or paramedical personnel

Coverage distinctionCustodial care is excluded from skilled nursing and skilled rehabilitation coverage under this guideline

Skilled Nursing and Skilled Rehabilitation Services

Policy Summary

PayerAnthem

PolicySkilled Nursing and Skilled Rehabilitation Services (Outpatient)

Policy CodePolicy CG-REHAB-07

Change TypeNo material clinical or coverage change

Effective DateOct 1, 2026

Last ReviewAug 13, 2026

Next Review DateN/A

Key ActionMaintain physician orders and documentation showing the skilled nature of the service, licensed personnel involvement, and why the service is not custodial.

SourceLink

On This Page

Do not bill or support services that are custodial in nature.
Skilled status may be appropriate to prevent deterioration or maintain current capabilities, even when full or partial recovery is not possible.
Diagnosis or prognosis alone must not be used as the sole basis to determine that a service is not skilled.

Documentation Required

Document Rehabilitation Medical Necessity

For rehabilitation, document an acute medical condition or acute exacerbation of a chronic condition causing functional decline such that the individual cannot adequately recover without therapy. Establish that outpatient care is appropriate, the individual is medically stable and able to participate, and the therapy is reasonable and necessary in amount, duration, and frequency under an active written physician-and-therapist treatment plan.

Document potential for improvement based on the individual’s pre-onset mental and physical condition, or the need to establish a safe and effective maintenance program.
Show that the individual requires the judgment, knowledge, and skills of a licensed therapist.
Include measurable functional improvement expected within a reasonable and generally predictable period, plus a discharge plan.

Documentation Required

Add Service-Specific Justification

Provide additional medical-record support when billing selected skilled services, including catheter care and postoperative colostomy care. The record must explain why the service is reasonable and necessary for the individual’s condition and identify the physician orders, complications, assessments, and skilled interventions supporting the service.

For urethral catheter insertion or maintenance, establish that it is an adjunct to active treatment of urinary-tract disease and not merely for convenience or incontinence.
For colostomy care, document the early postoperative period, associated complications, and the justified need for skilled care.
For heat treatments, document a physician order, active treatment purpose, and skilled observation of progress.
For rehabilitation nursing, bowel and bladder training, medical gases or nebulizers, dressings requiring prescription medications and aseptic technique, and treatment of Grade 3-or-worse decubitus ulcers or widespread skin disorders, document the active treatment and skilled personnel requirements.
If an ordinarily non-skilled service requires skilled performance, supervision, or observation because of special medical complications, document the complications in physician orders and nursing or therapy notes.

Documentation Required

Meet Foundational Skilled-Service Requirements

Before furnishing or billing outpatient skilled services, confirm all foundational requirements: a physician order; involvement of licensed skilled personnel; direct provision or general supervision by qualified nursing or rehabilitation personnel; medical necessity; and a service that is not custodial. The record should connect the order, skilled intervention, individual-specific need, and desired clinical result.

Skilled personnel may include registered nurses, licensed practical or vocational nurses, physical therapists, occupational therapists, speech pathologists, and audiologists.
General supervision must be sufficient to assure safety and achieve the medically desired result.
Custodial care does not qualify as outpatient skilled nursing or skilled rehabilitation.

Denial Risk

Prevent Medical-Necessity Denials

Expect denial when outpatient skilled nursing or skilled rehabilitation criteria are not met. Nursing services are not medically necessary without the required complexity, skilled observation or assessment need, and noncustodial nature; rehabilitation is not medically necessary unless every applicable eligibility, treatment, stability, skilled-need, outcome, and discharge requirement is documented.

Do not submit rehabilitation without an acute condition or exacerbation causing functional decline, outpatient appropriateness, medical stability, and an active written treatment plan.
Do not submit therapy that is not reasonable and necessary in its amount, duration, or frequency, lacks a licensed therapist’s skilled judgment, or has no expected measurable improvement or safe maintenance purpose.
Failure to document physician orders, skilled personnel involvement, direct provision or qualified supervision, or individual-specific medical necessity creates denial risk.

Documentation Required

Establish Rehabilitation Eligibility and Expected Response

Confirm rehabilitation eligibility before initiating or continuing outpatient therapy: the individual must have an acute condition or exacerbation with functional decline, be medically stable and appropriate for outpatient treatment, require licensed therapist skills, and have a reasonable expectation of measurable improvement or establishment of a safe and effective maintenance program.

Therapy must be directly and specifically related to an active written treatment plan developed by the physician and therapist.
Document the expected response within a reasonable and generally predictable period and include a discharge plan.
A maintenance-oriented service may qualify when necessary to establish a safe and effective maintenance program, even when recovery is not expected.

Denial Risk

Justify Exceptions to Routine or Stable Care

Do not treat stable chronic services as skilled without a documented ongoing skilled need. Stable continuous tube feedings after the initiation phase, and catheter care performed only for convenience or incontinence, are not skilled services unless individual-specific medical necessity and the required skilled complexity are established.

Initiation of nasogastric, gastrostomy, or jejunostomy feedings and associated continuous feedings may be skilled when medically necessary; stable continuous feedings beyond initiation generally are not.
Lay family members or friends may sometimes be trained to provide chronic stable bolus feeding or uncomplicated pharyngeal or tracheal suctioning.
A urethral catheter alone does not justify skilled nursing; document active urinary-tract treatment and why insertion or maintenance is reasonable and necessary.
Record the special complication, physician order, skilled intervention, and nursing or therapy notes whenever an otherwise routine service is claimed as skilled.

Ordering requirementFurnished pursuant to physician orders

PersonnelRequires the skills of licensed technical or professional health personnel, such as registered nurses, licensed practical or vocational nurses, physical therapists, occupational therapists, and speech pathologists or audiologists

Provision or supervisionProvided directly by, or under the general supervision of, skilled nursing or skilled rehabilitation personnel

Purpose of supervisionTo assure the individual's safety and achieve the medically desired result

Custodial limitationMust not be custodial in nature