Attorney Samuel Maizel examines important aspects of lending against Medicare receivables, specifically
setoff and recoupment rights, as well as the length of time it can take for Medicare to make payments and
conduct audits.
The year 1999 witnessed a rash of SNF bankruptcies following a major change in Medicare reimbursement when the Healthcare Financing Administration began to transition to a prospective payment system for SNF services. In the decade that followed, SNF operators experienced a period of relative stability, but it may have been the proverbial calm before the storm. Seismic shifts in funding sources, the consequences of a weakened economy from the Great Recession may soon produce another wave that could rock the industry.