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To get paid or not, the answer could be a simple “Yes” or “No” – POA

By Prime Care Tech Marketing on Thu, Feb 18, 2016 @ 07:00 PM

iStock_000020034644_Small.jpgSome SNF providers strongly assert that HAC-POA (Hospital Acquired Condition-Present on Admission) indicators do not apply to claims submitted to SNFs. Yet, recently an entire batch of claims submitted to a large insurance carrier was rejected, because the SNF provider’s billers had not included the POA indicator. The provider resubmitted the claims and mysteriously the insurer processed the claims without further difficulties related to POA. So what happened? In essence, these providers are right about POA and Medicare claims, but in fact, since the beginning of the year, we are observing that some insurers are indeed beginning to impose the POA indicator requirement on SNFs for non-Medicare claims and, possibly, Medicare co-insurance claims.

What is a Present on Admission Indicator? A little background

POA is defined as “being present at the time the order for inpatient admission occurs.”[1] It is not new (to IPPS [Inpatient Prospective Payment System] hospitals, that is) and has been in effect since 2007. “As required by the Deficit Reduction Act of 2005 (DRA), … hospitals must submit POA information on the principal and all secondary diagnoses for inpatient discharges….”[2] This all appears to relate to HACs and the DRA’s intent to not pay for conditions that could have reasonably been prevented which were acquired during a hospital stay.  

So, why is that important? IPPS hospitals do not receive the higher payment for cases when one of the selected conditions is acquired during hospitalization (that is, the condition was not present on admission). The case is paid as though the secondary diagnosis was not present. Here are the POA indicator codes:





Diagnosis was present at time of inpatient admission.

Payment is made for condition when a HAC is present.


Diagnosis was not present at time of inpatient admission.

No payment is made for condition when a HAC is present.


Documentation insufficient to determine if condition was present at the time of inpatient admission

No payment is made for condition when a HAC is present.


Clinically undetermined. Provider unable to clinically determine whether the condition was present at the time of inpatient admission.

Payment is made for condition when a HAC is present.

1 or blank

Unreported/Not used. Exempt[3] from POA reporting. This code is equivalent to a blank on the UB-04, however; it was determined that blanks are undesirable when submitting this data via the 4010A.

Exempt from POA reporting

But this applies to IPPS hospitals. What about SNFs?

Why POA could be important to SNFs

While the above rule appears not to apply to SNFs billing Medicare, we are indeed seeing that some large insurers, like Cigna, require “the POA indicator to be present for all diagnosis codes submitted on the inpatient claim form. Cigna reserves the right to return any inpatient claim without a POA indicator.”[4] This reinforces what NUBC (National Uniform Billing Committee) requires for all diagnosis codes.[5]

How should billers use the POA?

“POA indicators must be reported on each diagnosis code submitted on facility claims, except for ‘specific’ diagnosis codes. CMS publishes a listing of diagnosis codes that are exempt from the POA indicator requirement….It’s crucial that claims submission staff be familiar with the ICD-10-CM codes currently on the file”[6] SNF billers may have to complete the POA indicator box next to each diagnosis code, using the Y, N, U, or W indicators listed in the table above, especially when submitting claims to CIGNA which is requiring it for all diagnosis codes. Failure to do so may result in claims rejections.

Hint: The indicator is case sensitive. Always use the upper case.

Caution: Other insurance companies, like CIGNA, may require completion of the POA for Medicare co-insurance claims submitted to them for payment.

Advice: Be aware and check with the insurance payers. We are going to keep our eyes on this issue. We’ll keep you posted.

It only makes cents.

What has your experience been with POA?


[1] https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/wPOAFactSheet.pdf

[2] Ibid.

[3] Ibid.

[4] http://www.centercare.com/pdf/referenceguides_nat_803774_2013_2ndqtr.pdf

[5] http://www.nubc.org/aboutus/PDFS/Feb2014TentSchedule.pdf, p. 14 of the pdf

[6] http://www.cgsmedicare.com/parta/pubs/news/2015/0915/cope30310.html

Topics: SNF POA Deficit Reduction Act IPPS POA indicator Present on Admission Hospital Acquired Condition


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