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Aric Martin Rolf Goffman Martin Lang LLPAric Martin addressed therapy contracting in SNFs as part of an interview in the March edition of Compass, published by the Michigan County Medical Care Facilities Council.

He was interviewed by Lyle Townsend and Tara Townsend of Impact Wellness & Rehab, and a summary of the interview was entitled Therapy Connection: What’s in Your Contract?

Elements that Aric noted for skilled nursing facilities to keep in mind when negotiating therapy contracts included the following:


  • Not all therapy companies are equal!
  • High number of therapy companies are available in Michigan
  • Many facilities are attracted to vendors with the lowest price or who they like personally
  • Select a partner that can weather the storms!
    • Who can you partner thru RCS-1 or other payment changes?
    • How long have they been in business?
    • What is their compliance infrastructure?
      • Bootstrap with your training and auditing processes
    • What is their market capitalization?
      • Are they able to reimburse facility for denied claims?
    • Demonstrate due diligence with vendor selection, not just based on pricing, but also their compliance program and processes


  • Don’t just accept the therapy vendor’s contract!
    • Have your own contract with standards and conditions
    • Protect yourself and identify risks!
    • Contract Management
      • Review contract annually: the agreement and rates
      • Fiduciary responsibility to county/board
        • RFP Process: Check the market every 2 years for fair market value and service updates


  • ADR Notification
    • Time from receipt is negotiable
      • Highly litigated contract clause
      • Many vendors have a short timeframe i.e. 5 days after facility receipt of ADR or they are off the hook for payment remuneration
      • Negotiate for similar time frames per audit timelines
  • Qualifications of Therapists and Assistants
    • Who is responsible for verification and indemnification if not completed
      • Licenses and OIG Medicare Exclusion
  • End of Contract Relationship and Transition to New Vendor
    • Discuss and negotiate former or new vendor’s assistance and financial recoupment for past claims
    • Review therapy staff solicitation restrictions/transfer to new
  • Current Potential Exposure Beyond ADRs
    • Higher enforcement environment
    • Consider Extrapolation used from MACs/UPICs and False
      Claims Act

      • Is exposure limited to only disallowed claims?
      • Increasing use of extrapolation
        • Need to negotiate with therapy vendor shared financial responsibility
  • Internal compliance audit findings
    • How does contract handle proactive compliance findings, not in response to government audit?
    • What is therapy provider responsibility when repayments are mandated under the “60 Day Overpayment Rule”?
  • Consider non-ADR government investigations
    • Qui tam false claims
    • UPIC audits
    • What is the therapy provider’s prospective responsibilities for defense, paybacks, cooperation?

A copy of the March, 2018 Compass may be accessed HERE.