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N106 Remark Code: Bill the SNF, Not the Patient

N106 means the service was furnished to a patient in a covered skilled nursing facility (SNF) inpatient stay, and payment for it (unless it is an excluded service) can only be made to the SNF. The outside provider must seek payment from the SNF, not from the patient.

Code: N106 (RARC N106)
Status: Active In use since January 31, 2002.
Code set: Remittance Advice Remark Codes (RARC)
Group codes: CO (Contractual Obligation): The payer will not pay the outside provider, and the patient cannot be billed. The amount is recoverable only through an arrangement with the SNF.
Official description: Payment for services furnished to Skilled Nursing Facility (SNF) inpatients (except for excluded services) can only be made to the SNF. You must request payment from the SNF rather than the patient for this service.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified: September 24, 2026 against the official X12 list.

What N106 means

Under SNF consolidated billing, the skilled nursing facility is paid one rate that covers most of what its Part A inpatients receive, including many services from outside suppliers, labs, and therapy providers. N106 tells an outside provider that its claim overlapped a covered SNF stay and that the service falls inside that bundle.

It usually appears with CARC 190 or a misdirected-claim reason. The official text also puts a limit on collection: ask the SNF, not the patient.

Common causes

A lab, imaging supplier, or therapy company served a patient without knowing they were in a Part A SNF stay.
A patient was seen in the office or an outpatient department during a SNF stay and registration did not capture it.
Supplies were delivered to a patient who had been admitted to a SNF after the order was placed.
The service was believed to be excluded from consolidated billing, but it is not on the excluded list.

What to do

Confirm the SNF stay dates through the eligibility response or by contacting the facility.
Check whether the service is excluded. If it is, gather documentation and ask the payer to reprocess or appeal.
If it is bundled, send an invoice to the SNF under your agreement with it. If you have no agreement, contact the facility’s business office.
Do not transfer the balance to the patient.

How to prevent it

Ask every patient, especially older patients recently discharged from a hospital, whether they are staying at a nursing or rehab facility. For suppliers and labs, set up agreements with SNFs you regularly serve so orders from their residents are billed to the facility. The eligibility and COB guide covers upstream verification steps.

Codes that may appear with N106

CO-190 (Payment is included in the allowance for a Skilled Nursing Facility (SNF) qualified stay.): Payment is included in the allowance for a qualified SNF stay.
CO-109 (Claim/service not covered by this payer/contractor.): Not payable by this payer or contractor as billed; the SNF is the party that bills.
CO-97 (The benefit for this service is included in the payment/allowance for another service/procedure that has already been adjudicated.): The benefit is included in the payment for another service, here the SNF's payment.

N107 (Services furnished to Skilled Nursing Facility (SNF) inpatients must be billed on the inpatient claim.): The institutional counterpart: SNF inpatient services must go on the inpatient claim.
N121 (Medicare Part B does not pay for items or services provided by this type of practitioner for beneficiaries in a Medicare Part A covered Skilled…): Part B does not pay this type of practitioner during a Part A SNF stay.
N70 (Consolidated billing and payment applies.): A general statement that consolidated billing and payment apply.

N106 FAQ

Which services are excluded from SNF consolidated billing?

Medicare excludes certain physician and practitioner professional services and specific high-cost or specialized services. The excluded categories are defined in Medicare's SNF consolidated billing rules and are updated periodically, so check the current list for the code billed.

Can I bill the patient if the SNF won't pay?

No. The official remark says to request payment from the SNF rather than the patient. Collecting from the patient is not permitted for services bundled into the SNF's payment.

How do I get paid then?

Through an agreement with the SNF. The facility bills the payer and pays you under the terms you negotiated.

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