A skilled service is one which must be furnished by or under the supervision of trained medical or paramedical personnel to assure the safety of the patient and achieve the medically desired result. A service which can be safely and adequately self-administered or performed by the average, rational, nonmedical person, without the supervision of trained medical or paramedical personnel, is a non-skilled service. For example, a patient, following instructions can normally take oral medication. Giving of oral medication by a nurse to a patient who is unable to take it on their own because of senility would not change the service from a non-skilled to a skilled service.

If the primary purpose of the total care provided an individual is to assist the individual in meeting the activities of daily living, the custodial care exclusion applies.

However, if the skilled services furnished the patient are the primary purpose for the total care provided, the custodial care exclusion does not apply.

If it is medically necessary to have the services of a nurse available to the patient at all times, the need for this service alone establishes that the primary purpose of the total care is the provision of this skilled service.

When a patient does not require nursing services, the primary purpose of the total care furnished is generally to assist the patient in meeting the patient's activities of daily living.

Where the need for nursing services is only minimal, the furnishing of skilled services is the primary purpose of the total care furnished only if all the skilled services furnished in view of the patient's condition are such that they could not be performed outside the institutional setting. These situations will probably be limited to those where an individual is hospitalized for the running of extensive diagnostic tests.

All physician services rendered to a patient are skilled services.

Many individuals who require only custodial care may need periodic physician visits for assessment of their medical status so a medical decision may be made as to whether changes are required in the type of care they are receiving. Nevertheless, periodic visits by a physician to a patient do not change the custodial character of the care when the primary purpose of the total care furnished the patient by the hospital or SNF is to assist the patient to meet the patient's activities of daily living.

(Periodic visits by a physician to the physician's patients are covered under Part B if reasonable and necessary to the treatment of the patient's illness or injury. Such physician services are reimbursable even though a finding has been made that the care furnished the patient in the hospital or SNF is custodial and therefore not covered. A finding that the level of care is non-covered does not preclude reimbursement for those ancillary services (see HI 01201.055) covered under Part B which are furnished to the patient provided they are medically necessary. Reimbursement for such services can be made only under Part B.)

For services in a psychiatric hospital to be designated as "active treatment," they must be provided under an individualized treatment or diagnostic plan, reasonably expected to improve the patient's condition or for the purpose of diagnois, and supervised and evaluated by a physician.

The services must be provided in accordance with an individualized program of treatment or diagnosis developed by a physician in conjunction with staff members on the basis of a thorough evaluation of the patient's restorative needs and potentialities. Thus, an isolated service, e.g., a single session with a psychiatrist, or a routine laboratory test not furnished under a planned program of therapy or diagnosis does not constitute active treatment, even though the service was therapeutic or diagnostic in nature.

The service must reasonably be expected to improve the patient's condition or must be for the purpose of diagnostic study. The treatment must, at a minimum, be designated both to reduce or control the patient's psychotic or neurotic symptoms which necessitated hospitalization and improve the patient's level of functioning.

If, however, the only activities prescribed for the patient are primarily diversional in nature, i.e., to provide some social or recreational outlet, it is not regarded as treatment to improve the patient's condition.

In accordance with the above definition of “improvement,” the administration of antidepressant or tranquilizing drugs which are expected to alleviate significantly a patient's psychotic or neurotic symptoms is termed active treatment (assuming that the other elements of the definition are met). The administration of a drug or drugs does not of itself necessarily constitute active treatment. Thus, the use of mild tranquilizers or sedatives solely for the purpose of relieving anxiety or insomnia does not constitute active treatment.