Skilled Nursing Facility After Hospital in Tennessee: Medicare Rules, Costs, and What to Expect

Your parent broke a hip in Knoxville and spent five days in the hospital. The surgeon says they need weeks of physical therapy before going home. The discharge planner mentions "SNF rehab" and hands you a list of facilities. You have maybe 48 hours to choose one — and the financial stakes are enormous depending on how the stay is classified.

The 3-Day Inpatient Rule

Medicare Part A covers skilled nursing facility rehab, but only if your parent had a qualifying hospital stay first. The requirement: three consecutive days as a classified inpatient, not counting the discharge day. Observation status days don't count, even if your parent was physically in a hospital bed.

If the 3-day requirement is met, Medicare covers:

• Days 1–20: 100% of approved SNF costs
• Days 21–100: Everything except a daily coinsurance of $217 in 2026
• After day 100: Medicare pays nothing

The 100-day clock resets when a new benefit period begins — which requires your parent to go 60 consecutive days without inpatient hospital or SNF care.

If the hospital stay was classified as observation, none of this applies. Your parent faces the full private-pay rate from day one, which in Tennessee averages $240 per day for a semi-private room.

Medicare Advantage SNF Coverage

Medicare Advantage plans often waive the 3-day inpatient requirement, which can be a significant benefit for patients whose hospital stay was under observation. However, MA plans typically require prior authorization before SNF admission, and they may limit which facilities are in-network.

Check the plan's Evidence of Coverage document for:

• Whether the 3-day rule is waived
• Prior authorization requirements and turnaround time
• The daily copay structure (which varies significantly between plans)
• Network SNF facilities near your parent's home

Rehab vs. Long-Term Custodial Care

This distinction controls everything about how the stay is paid for.

Short-term rehab is skilled, intensive care focused on recovery. The patient receives daily physical therapy, occupational therapy, or speech therapy with a realistic goal of returning home or to a lower level of care. Medicare Part A covers this.

Long-term custodial care is assistance with daily living activities — bathing, dressing, eating, toileting — without the expectation of significant medical improvement. Medicare does not cover custodial care at all. In Tennessee, it's funded either through private payment (averaging over $7,200/month) or through TennCare CHOICES Group 1 for Medicaid-eligible residents.

The transition between these two categories often happens gradually. Your parent starts in rehab, makes progress, then plateaus. At that point, the facility determines they no longer meet the skilled care requirement, and Medicare coverage stops.

The NOMNC: When Medicare Coverage Is Ending

Before ending your parent's Medicare-covered SNF services, the facility must deliver a Notice of Medicare Non-Coverage (NOMNC, Form CMS-10123). This written notice must arrive at least two days before the last covered day.

The NOMNC is your warning shot. If you believe your parent still needs skilled rehab — they're making progress, the therapist says they haven't plateaued, or the facility is cutting coverage prematurely — you can appeal.

To appeal a NOMNC in Tennessee, contact Acentra Health (the state's BFCC-QIO) at 1-888-317-0751 no later than noon the day before coverage is scheduled to end. If you file on time, your parent's Medicare coverage continues through the review, and they won't be billed for the extra days unless Acentra upholds the termination.

PASRR Screening Before Admission

Before any nursing facility in Tennessee can admit your parent, federal law requires a Pre-Admission Screening and Resident Review (PASRR). This screening identifies whether the patient has a serious mental illness or intellectual disability that requires specialized services beyond what a standard nursing facility provides.

The PASRR is initiated by the hospital or referring provider, not by the family. But if your parent has a history of depression, anxiety, bipolar disorder, or dementia with behavioral symptoms, make sure the discharge planner knows — the screening results affect which facilities can accept the admission and what additional services must be provided.

What Happens When Medicare Runs Out

When the 100-day benefit ends — or your parent's rehab coverage is terminated earlier — you face a decision point:

Go home with home health services. If your parent can safely return home with intermittent skilled nursing or therapy visits, Medicare Part A covers home health without a prior hospitalization requirement. The patient must be homebound and need skilled care.

Apply for TennCare CHOICES. If your parent needs ongoing nursing facility care and meets financial eligibility (income under $2,982/month, assets under $2,000), TennCare CHOICES Group 1 covers the nursing home indefinitely. Applications take time — start the process early, ideally while your parent is still in Medicare-covered rehab. Medicaid Pending status protects against discharge for non-payment while the application is reviewed.

Private pay. If your parent has the resources, they can continue at the SNF as a private-pay resident. Many families use this bridge while waiting for TennCare approval.

The Tennessee hospital discharge transition toolkit includes a facility comparison worksheet for evaluating SNF options, a timeline for coordinating the Medicare-to-Medicaid transition, and appeal templates for challenging a premature NOMNC.

Choosing the Right Facility

When selecting a SNF in Tennessee, check the Tennessee Health Facilities Commission inspection reports at internet.health.tn.gov. Look at staffing ratios, complaint history, and any recent enforcement actions. Ask the facility directly about their experience with TennCare CHOICES patients — some facilities limit the number of Medicaid beds, which can become a problem if your parent needs to transition from private pay or Medicare to TennCare funding during their stay.

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