2. Failure to notify timely

Failure or omission by the UR committee to timely notify the physician, the patient, or the patient's next of kin does not create a right to payment where, as a matter of law, none exists. Such failure does not justify payment to the institution for an expense item (e.g., custodial care) which is specifically excluded by statute. However, where the institution is notified of an adverse finding by the UR committee, the institution can be found liable under the waiver of liability provision for noncovered services it provides to the beneficiary after the expiration of the grace period (see 3. below) up to the date the beneficiary receives written notice of the noncoverage of the services. For example, the institution receives notice from the UR committee on March 1 that services were not reasonable and necessary beginning February 27, but does not advise the beneficiary until March 5 and the patient is discharged on March 6. Where both the beneficiary and the institution meet the requirements for waiver of liability program payment can be made for the noncovered service on February 27 and 28 and March 1, and also for 3 more days (March 2, 3, and 4) after the date the provider is notified of the UR finding. However, program payment for March 5 would not be made nor would the beneficiary be responsible for the charges since they did not receive notice until that date.