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Home Health Agency Alert: The Review Choice Demonstration Project start dates for Ohio, Texas, North Carolina and Florida are Around the Corner!

August 7, 2019 by  
Filed under Home Health & Hospice

The Review Choice Demonstration Project starts(August 7, 2019): This article further updates our articles of February 19th and April 9th on the announcement by CMS of the implementation of the new five year “Review Choice Demonstration Project’ in five states – Illinois, Ohio, Texas, North Carolina and Florida, and the start date for the Demonstration Project in Illinois.

 

I. Background of the Review Choice Demonstration Project:

As background, the Review Choice Demonstration Project is an outgrowth of the Pre-Claim Review Demonstration Project that was initiated in Illinois in August 2016 and paused in April 2017.  Instead of continuing the Pre-Claim Review Demonstration, the Centers for Medicare and Medicaid Services (CMS) announced a new initiative – the Review Choice Demonstration Project to be phased in for the five states listed, above.

Under the Review Choice Demonstration Project, agencies in the affected states will initially select from three options to have their home health claims reviewed:

  • Pre-claim review;
  • Post-payment review; or
  • Minimal post-payment review with a 25% reduction.

After each six-month period agencies with a 90% affirmation or approval rate will be able to choose from two additional options that may be preferable depending upon the circumstances of each agency.  Our February 19th article discusses each of these options.

II. Illinois Home Health Claims are Under the Microscope:

The Review Choice Demonstration Project initially began in Illinois on June 1 for all episodes of care beginning on that date. Prior to that date, Illinois agencies were required to make a selection as to the initial option that they chose for this period between April 17 and May 16.

On July 29, 2019, CMS announced that Ohio will be the second State to implement the Review Choice Demonstration Project.  Home health agencies in Ohio will have from August 16th to September 15th to select an option for the first six-month period, which will begin on September 30, 2019 for all episodes of care starting on or after that date.  Any agency that fails to select an option during this period will be assigned to the second option, above – post-payment review.[1]

CMS also announced that it anticipates 60 – 90 days between beginning the Demonstration in the remaining states of Texas, North Carolina and Florida, and will provide 60-days’ notice in advance of the start date.  While the announcement is somewhat unclear as to whether this period will be spread out for each remaining state or that all three will start on the same date, it is clear that agencies in each of those states and Ohio should begin planning now for that implementation if they have not already done so.

CMS has published links to the Palmetto GBA portal for selecting and registering an option during this period as well as a number of additional resources at https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Review-Choice-Demonstration/Review-Choice-Demonstration-for-Home-Health-Services.html.

III.  Planning for Implementation – Especially in Light of PDGM:

Our February 19th article goes into greater depth in explaining the various options.  However, most importantly, both articles emphasize the importance of thinking through which option makes the most sense for your agency.

Each one presents risks and benefits and the correct choice may differ depending upon the agency’s comfort and experience with denials and documentation, as well as operational capability – the one exception being that the third option – a 25% rate reduction, does not appear to be viable for any agency.  Our earlier articles also sets forth several examples of those risks and benefits and while not exhaustive, is meant to focus agencies on the thought process that your agency will want to consider in making this determination.  We thus cannot strongly enough recommend that each agency take the necessary time to consult with knowledgeable individuals both internal and external in making this determination for each 6-month period, and not wait until the last minute to do so.

Of equal, or perhaps greater, importance is the need for agencies in affected states to have procedures in place to prepare and quickly access documentation to properly support coverage for the cases that they take, and to move this documentation through the system quickly, accurately, and comprehensively.  This is especially important given the advent of the Patient- Driven Groupings Model (PDGM) on January 1, 2020.  For example, coding will be a key issue in driving coverage and payment, and “getting it right” in your documentation will be critical.  Also, addressing initial non-affirmation determinations quickly for agencies that select option 1 will be critical.

Finally, agencies should be updating their compliance and quality assurance programs to respond both to the PDGM payment model and to the Review Choice Demonstration Program.

Liles Parker attorneys have substantial experience in advising and working with home health agencies in preparing them for the audit process which is similar to the process that they will need in responding to the Review Choice Demonstration Project, and in identifying the risks of choosing one option in relation to the others.  For example, one of the additional two options available to agencies that score above the 90% affirmation or approval level in options 1 or 2 during a 6-month period may result in the inadvertent development of a statistical sample that can be utilized to broaden the scope of any denials and recovery.  A number of our attorneys are also Certified Professional Coders who have substantial experience in evaluating home health claims documentation. Finally, we have substantial experience in working with home health agencies in developing and updating their compliance plans.

Michael Cook Healthcare AttorneyAny person wishing a free consultation in this area should contact Michael Cook, the author of this article and Co-chair of the Health Care Group.  Michael Cook can be reached at (202) 298-8750 and mcook@lilesparker.com.

 

[1] We would also note that there was a misprint in our article of April 9.  That article inadvertently referenced that Illinois providers failing to make a choice during the initial registration period would be assigned to the third option.  The corrected reference is to the second option.

CMS has Ended its Moratorium on New Home Health Agencies in Texas, Illinois, Michigan and Florida. Unfortunately, the Lifting of the Moratorium Isn’t Necessarily a Good Thing for Existing Home Health Agencies.

February 19, 2019 by  
Filed under Home Health & Hospice

Review Choice Demonstration Project(February 19, 2019):  CMS has now ended, at least for the current time, the moratorium that it placed on the approval of new home health agencies.  At the same time, home health providers that operate in Illinois, Ohio, North Carolina, Florida and Texas, and potentially other states within the Palmetto/JM jurisdiction (Alabama, Arkansas, Georgia, Indiana, Kentucky, Louisiana, Mississippi, New Mexico, Oklahoma, South Carolina, and Tennessee) face the likelihood that a revised pre-payment demonstration model will be implemented in the near future.

I.  Lifting of the Moratorium:

Effective January 30, 2019, CMS has officially ended the “temporary” moratorium on new home health agencies, sub-units and branch locations (collectively referred to as “HHAs,” “home health agencies,” or “agencies”) in Illinois, Michigan, Texas and Florida.[1]  This means that there is no longer in effect a federal prohibition on enrolling new home health agencies in the Medicare program in these or any other states, and that agencies in these states that wish to enroll in Medicare can now begin the process of doing so.

II.  Background of the Home Health Agency Moratorium:

CMS initially imposed a temporary moratorium to prevent the enrollment of new home health agencies in Miami-Dade County, Florida and Cook County, Illinois and surrounding counties in 2013.  CMS then extended the existing moratoria and expanded them to cover Broward County, Florida, Dallas and Harris Counties, Texas, Wayne County, Michigan and surrounding counties.  Finally, in August 2016, CMS extended and expanded the moratoria on new HHA’s to Florida, Illinois, Michigan and Texas, and further extended those moratoria through January 2019.  CMS has justified the imposition of the moratoria and selection of the geographic areas based on its view that those areas were especially at high risk for fraud, waste, and abuse.  Finally, CMS lifted the moratorium on home health agencies in these states effective January 30.

III.  What is the Anticipated Impact of Lifting the Moratorium?

As noted, above, this means that providers that wish to enroll new home health agencies in Medicare in these states may now begin that process.  However, experience has demonstrated that CMS is not reticent to take these, and other, actions when the agency believes that there is a high risk of fraud and abuse in particular localities.  Additionally, federal law and regulations require states to impose temporary moratoria on enrollment in the Medicaid and CHIP programs except in certain circumstances in areas and over time periods where Medicare takes these actions.  Finally, this relief affects only CMS approval.  It does not eliminate the need to check and comply with any restrictions that state or local governments may place on the establishment of new agencies.  Thus, as always, we continue to recommend to all home health agency providers that they establish and maintain strong compliance programs to alleviate the perceived need of moratoria in the future, and also to minimize the likelihood that their agencies will be the subject of investigation or sanctions.

IV.  CMS’s Review Choice Demonstration Project:

CMS’s Review Choice Demonstration Project is an outgrowth of the what was called the Pre-Claim Review Demonstration Project.  In August 2016, CMS initiated the Pre-Claim Review Demonstration Project for Illinois home health agencies under which these agencies were required to submit all of their Medicare claims and documentation for a pre-claim review prior to submitting them for payment.  It was only after the claim was “affirmed” that the agency could submit it for payment.

Initially, according to CMS, there was a wide variation of affirmation rates among agencies.  However, according to CMS, by the end of the first six-month period, agencies had on the average much higher affirmation rates.  The demonstration project was paused in April 2017 and has not been re-instituted or expanded past Illinois.

In light of the various problems encountered when implementing the Pre-Claim Review Demonstration Project, CMS has chosen not to re-initiate the program.  Instead, CMS revised its approach and announced that a new initiative, the Review Choice Demonstration Project was being implemented.  Once it goes “live” in a state, the Review Choice Demonstration Project will be in effect for five years.  As noted above, the Review Choice Demonstration Project is scheduled to cover services provided in Illinois, Ohio, North Carolina, Florida, and Texas, with the option to expand it to other states under Palmetto’s jurisdiction.

The Review Choice Demonstration Project was initially scheduled to be implemented in December in Illinois, with a rollout in other states to follow with a 60-day advance notice. However, the Illinois rollout has been delayed awaiting approval under the Paperwork Reduction Act, after which the agency will announce the start date for the demonstration in Illinois.

Under the Review Choice Demonstration Project, agencies will have their choice of three options for the first six-month period: (1) 100% Pre-Claim Review; (2) 100% Post-Payment Review; or (3) Minimal review with an automatic 25% payment reduction.

V.  Initial Options Under the Review Choice Demonstration Project:

Under the Review Choice Demonstration Project, a home health agency will have the option of choosing among three alternatives with respect to how its claims will be handled.  These three alternatives include the following:

  • Option #1: 100% Pre-claim Review

Under the first option, a home health agency will submit the pre-claim with all relevant documentation.  If the pre-claim receives an affirmation notice, the agency can submit the claim and will receive full payment, and absent evidence of possible fraud or gaming, the claim will not be subject to post-payment review by the MAC, RAC or Supplemental Medical Review Contractor.  If a pre-claim receives a non-affirmative decision, it can be submitted again for pre-claim review with additional documentation or explanation. If a claim is submitted with a non-affirmative pre-claim decision, it will be denied with full appeal rights.   Claims submitted without receiving a pre-claim determination will be subject to prepayment review and even if determined to be payable, will be subject to a 25% reduction in payment rate.

After six months, the agency will have its affirmation rate calculated.  If it has submitted at least 10 claims and if it obtains at least a 90 % affirmation rate, the agency will be allowed to continue in this option or to choose between two other options, described, below.  If the agency’s affirmation rate for the six-month period was lower than 90% or it did not submit 10 claims during that period, it must choose between one of the three initial options.

  • Option #2: 100% Post-Payment Review

Under this option, the agency will be paid in the normal course, but will have all of its claims during a six-month period undergo complex medical review.  Subsequent to the review, the MAC will recover for any claims that it has paid during this period that it finds not to meet Medicare requirements, and the agency may appeal the decision through the normal appeals process.  If the agency has obtained at least a 90% approval rate during the six-month period, it will be able to choose either option one or one of the additional two options discussed, below.  Otherwise, it will have the option of choosing one of the initial three options for the next six-month period.

  • Option #3: Minimal Review with 25% Payment Reduction

An agency that chooses this option will have its claims reviewed under the normal process, but the payment amount will have an automatic 25% reduction.  Claims will not be subject to post-payment MAC reviews but will be subject to RAC and UPIC review under the normal review process, and any denied claims will be subject to the normal appeal process.  The 25% reduction in payment amount, however, is neither transferable to the beneficiary nor subject to appeal.  Any agency that chooses this option will not be able to change options for later periods and will remain under this option for the entire five-year “demonstration.”

VI.  Subsequent Options Under the Review Choice Demonstration Project:

An agency that has selected either Option 1 or 2, above and that has an affirmation rate of at least 90% in the prior six-month period may choose either Option 1, above – 100% Prepayment Review, or one of the two options, below – Options 4 (selective post-payment review) or 5 (spot check review).

  • Option #4: Selective Post-Payment Review

Under Option #4, the agency will be paid under normal claim processing procedures.  However, the MAC will select “a statistically valid random sample” every six months for complex review.  An agency selecting this option at any time will not be able to change options at a later point in time.

  • Option #5: Spot-Check Review

Under Option #5, the MAC will select 5% of claims to be subject to pre-payment review every six months.  The agency is able to remain in this option for the remainder of the demonstration provided that “the spot check shows that the agency is compliant with Medicare coverage rules and policy.”  If the agency fails to meet that standard, it will then be required to choose between the first three options for the next six-month period.

VII.   Recommendations:

For those agencies in one of the states selected for the demonstration, the selection of an option – whether initial or subsequent – will require some thought and analysis.  For example, Option 1 could well affect agency’s cash flow depending upon its ability to submit quickly the necessary documentation in a manner that clearly demonstrates coverage.  While CMS has suggested that the MAC will make every effort to review and make pre-claim determinations within 10 days of the first submission and within 20 days of subsequent submissions for the same claims, the continued ability of the MAC to meet these time frames will also have an impact upon cash flow.

In contrast, Option #2 will subject the agency to complex review of every claim that it submits and as those agencies that have been through the appeals process understand, the backlog of appeals has caused a substantial delay in resolution no matter how worthy the appeal on its merits.  Thus, unlike the pre-claim review process, the agency may not have the opportunity to correct its documentation and correct errors for a substantial period.

Option #3 guarantees a 25% payment reduction for all claims, while Option #4 will result in the selection of what the government may argue is a statistically valid random sample for purposes of any subsequent denials.

Under these circumstances, several things are clear.  Now more than ever, agencies in these states must have procedures in place to properly document coverage for all cases that they handle, and also a form and process to be able to support coverage and simplify the process for the MAC to come to that determination quickly and without the need for appeal or multiple submissions, depending upon the option chosen.

Liles Parker attorneys have substantial experience in working with agencies in the enrollment process for Medicare certification.  Additionally, a number of our attorneys are also certified coders and have substantial experience in developing a format to justify coverage of claims.

Michael Cook Healthcare AttorneyAny person wishing a free consultation in either area should contact the author and Co-chair of our Health Care Group, Michael Cook.  Michael can be reached at (202) 298-8750 or mcook@lilesparker.com.

 

 

 

[1] https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/MedicareProviderSupEnroll/ProviderEnrollmentMoratorium.html

Home Health Providers Under the Microscope — The Review Choice Demonstration Project is Here

October 4, 2018 by  
Filed under Home Health & Hospice

The Review Choice Demonstration Project (October 4, 2018):  Last week, the Centers for Medicare & Medicaid Services (CMS), confirmed that it intends to initiate the Review Choice Demonstration for Home Health Services project on December 10, 2018.  The Review Choice Demonstration project is slated to initially begin in Illinois. This initiative is the renamed, repackaged version of the prior Pre-Claim Review Demonstration project that was initiated, then placed on hold (due in large part to provider protests), in April 2017.  This article provides an overview of the long and sorted history leading up to the Review Choice Demonstration project.

I. Although Dropping, the Improper Payment Rates for Home Health Services Remain Excessive:

The last few years have been rough on home health providers.  As the government has been quick to note, one of the primary components of the Medicare Fee-for-Service (FFS) improper payment rate has consistently been the excessive level of improper payments made for home health services.  Broken down by fiscal year, the improper payment rates for home health services have included:

Fiscal Year

Report Period

Home Health Improper Payment Rate

FY 2014

July 1, 2012 – June 30, 2013

51.4%

FY 2015

July 1, 2013 – June 30, 2014

59%

FY 2016

July 1, 2014 – June 30, 2015

42%

FY 2017

July 1, 2015 – June 30, 2016

32.3%


Although the improper payment rate for home health services has dropped considerably from FY 2015 to FY 2017, it still constitutes a major portion of the overall Medicare FFS improper payment rate.  During the FY 2017 report period, it is estimated that more than $6.1 billion in improper payments was made by Medicare for home health services.  When reviewing the improperly paid claim lines associated with FY 2017, the Comprehensive Error Rate Testing (CERT) contractor tasked with this project found that more than 89% of the errors were due to documentation deficiencies. 

II. Overview of Corrective Actions and Initiatives Taken by CMS to Address Home Health Documentation Deficiencies:

The FY 2017 CERT contractor findings with respect to documentation have merely further strengthened the government’s long-standing belief that home health providers (and referring physicians), need ongoing education and guidance with respect to the medical necessity, documentation, coverage and payment requirements that must be met.  Over the last few years, CMS and its contractors have implemented a variety of corrective actions intended to address documentation and medical necessity deficiencies that have been identified in connection with Medicare home health claims. Examples of these actions have included Probe and Educate Reviews[1], the initiation of the Pre-Claim Review Project[2], the development of Home Health Plan of Care / Certification and Progress Note Clinical Templates[3], and the establishment of a Home Health Recovery Audit Contractor[4].  CMS also revised the Physician Face-to-Face Narrative Requirement[5] for home health services. Several of these corrective initiatives are discussed in more detail below:

A. Probe and Educate Reviews.

In late 2015, home health Medicare Administrative Contractors (MACs) began pulling five claims sample from each home health agency in their jurisdiction for prepayment review purposes.  The claims subject to review covered episodes of service beginning on or after August 1, 2015.  The purpose of the Probe and Educate Review initiative was to better ensure that home health agencies were fully complying with applicable medical necessity, documentation, certification, coverage and payment requirements.[6] Systemic problems identified by home health MACs through the Probe and Education Review process has included:

  1. Failure to comply with face-to-face requirements. For example, in some cases, the certifying physician signature was missing. In other cases, the encounter notes did not document the elements required to show that the patient was eligible for home health services.
  2. Failure to identify an estimate of time for continued need when recertifying the medical necessity of services.
  3. Failure to fully complete and / or properly complete the initial certification documentation required.
  4. Bailure to timely respond to an Additional Documentation Request (ADR) request from a Medicare contractor in a timely fashion.

B. Pre-Claim Review Demonstration Project.

Section 402(a)(1)(J) of the Social Security Amendments of 1967 authorizes the Secretary, HHS, to:

‘‘develop or demonstrate improved methods for the investigation and prosecution of fraud in the provision of care or services under the health programs established by the Social Security Act (the Act).’’

Using this authority, and inn consideration of the excessively high home improper payment rate for home health services, in June 2016, CMS announced[7] the initiation of a new Pre-claim Review Demonstration project. Theoretically, the demonstration project was not intended to create any new clinical home health documentation requirements. Home health agencies covered by the demonstration project would be required to submit supportive medical documentation to the CMS contractor for review prior to being paid. This approach was intended to help educate providers and better ensure that home health claims qualified for coverage and payment. The demonstration project was also intended to test whether the use of a pre-claim review process would improve the government’s ability to identify, investigate, and prosecute home health fraud. Originally, the demonstration project was scheduled to be put into place in five states. CMS and its contractors planned on rolling out the project over a six-month period: 

  • Illinois: August 1, 2016
  • Florida: October 1, 2016
  • Texas: December 1, 2016
  • Michigan and Massachusetts: January 1, 2017

Two months later, CMS took its first steps towards putting the planned three-year project into place by implementing it in Illinois.  To characterize the implementation as “problematic” would be generous.  From its very start, Illinois home health providers, both large and small, experienced significant problems meeting the reviewer’s documentation requirements, thereby resulting in significant provider payment delays. Bending under political pressure, the planned roll-out in Florida was placed on hold. This effectively delayed implementation in the remaining three states as well.  After several false starts, the initiative was ultimately placed on hold in March 2017.  For a more detailed discussion of the Pre-Claim Demonstration project, please see the following article.  Additional information may also be found here.

C. Home Health Plan of Care / Certification and Progress Note Clinical Templates:

As required under 42 CFR 484.60, Condition of participation: Care planning, coordination of services, and quality of care, Medicare patients are accepted for treatment on the reasonable expectation that a home health agency can meet the patient’s medical, nursing, rehabilitative, and social needs in his or her place of residence. In order to accomplish this:

“Each patient must receive an individualized written plan of care, including any revisions or additions. The individualized plan of care must specify the care and services necessary to meet the patient-specific needs as identified in the comprehensive assessment, including identification of the responsible discipline(s), and the measurable outcomes that the HHA anticipates will occur as a result of implementing and coordinating the plan of care. The individualized plan of care must also specify the patient and caregiver education and training. Services must be furnished in accordance with accepted standards of practice.”

Similarly, 42 CFR 424.22, Requirements for home health services, mandates that a physician certify and recertify a patient’s eligibility for home health services in order to qualify for coverage and payment by Medicare.  Additional certification and recertification requirements are set out under the regulations.

Finally, CMS develop a template Progress Note that could be used by a physician and, when permitted under state law, by a physician assistant, a nurse practitioner, a clinical nurse specialist  and / or a certified nurse midwife to document that home health services are medically necessary and appropriate and to confirm that a Medicare patient is, in fact, homebound.

III. Rise of the Review Choice Demonstration Project:

In consideration of the various challenges encountered when trying to roll-out the Pre-Claim Review Demonstration project, CMS ultimately placed the initiative on hold in April 2017.  It is important to keep in mind that the underlying problem that gave rise to the Pre-Claim Review Demonstration project – an excessively high improper payment rate associated with home health services – was still (and continues to be) a serious program integrity concern. Additionally, it was abundantly apparent that wholesale changes would need to be made if the initiative were to be reintroduced. 

Over the next year, CMS completely reworked its prior initiative in an effort to provide additional flexibility for home health agencies that may be covered by an updated version of the project.   As reflected in the Federal Register, the “new and improved” initiative was named the Review Choice Demonstration project. As with its earlier iteration, the revised version of the demonstration project is intended to:

“help assist in developing improved procedures for the identification, investigation, and prosecution of potential Medicare fraud. The demonstration would help make sure that payments for home health services are appropriate through either pre-claim or postpayment review, thereby working towards the prevention and identification of potential fraud, waste, and abuse; the protection of Medicare Trust Funds from improper payments; and the reduction of Medicare appeals.”

CMS has again proposed that the demonstration project will be implemented in five states. Much to the dismay of Illinois, Florida and Texas home health providers, they are STILL on the list of targeted states.  Michigan and Massachusetts are no longer slated to be part of the demonstration.  In their place, CMS has substituted Ohio and North Carolina.  CMS has stated that the new list of five states are:

“known areas of fraudulent behavior and had either a high home health improper payment rate or a high denial rate during the home health Probe and Educate reviews.”

Notably, CMS has indicated that there is the possibility that the Review Choice Demonstration project may later be expanded to other states in the Palmetto / JM jurisdiction.

As set out in the September 28th Federal Register notice, CMS intended to implement the Review Choice Demonstration project in Illinois on December 10, 2018. 

A. The Review Choice Demonstration Project is Intended to Offer Flexibility to Home Health Providers.

CMS has designed the Review Choice Demonstration project so that home health agencies in affected states have several ways that they may show their “compliance with CMS’ home health policies.”  Options available to home health providers include[8]:

The Review Choice Demonstration Project

 

Robert Liles Healthcare AttorneyRobert W. Liles serves as Managing Partner at the health law firm, Liles Parker, Attorneys and Counselors at Law.  Liles Parker attorneys represent health care providers and suppliers around the country in connection with UPIC audits, ZPIC audits, OIG audits and DOJ investigations.  Are your transcranial magnetic stimulation claims being audited?  We can help.  For a free initial consultation regarding your situation, call Robert at:  1 (800) 475-1906.

 

[1] https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Medical-Review/Home_Health_Medical_Review_Update.html

[2] https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Pre-Claim-Review-Initiatives/Overview.html

[3] https://www.cms.gov/Research-Statistics-Data-and-Systems/Computer-Data-and-Systems/Electronic-Clinical-Templates/Downloads/Home-Health-Services-Plan-of-Care-Certification-Template-Draft-20180709-R20.pdf

[4] https://www.cms.gov/research-statistics-data-and-systems/monitoring-programs/medicare-ffs-compliance-programs/recovery-audit-program/

[5] https://www.cms.gov/Research-Statistics-Data-and-Systems/Computer-Data-and-Systems/Electronic-Clinical-Templates/Downloads/Home-Health-Services-F2F-Encounter-Template-Draft-20180709-R20.pdf

https://www.cms.gov/Research-Statistics-Data-and-Systems/Computer-Data-and-Systems/Electronic-Clinical-Templates/Downloads/Home-Health-Services-F2F-Encounter-Template-Draft-20180214-R10d.pdf

[6] Additional information regarding the Probe and Educate process is outlined in MLN Matters, MLN Matters ® Number:SE1524.

[7] 81 Fed. Reg. 37598.  June 8, 2016.

[8] 83 Fed. Reg. 48818September 27, 2018.

Expect an Increase in Audits of Chiropractic Services!

Chiropractic Services(April 16, 2018): Chiropractors around the country are again finding their services and claims under intensive scrutiny from Medicare contractors and investigators, despite the fact that only three services even qualify for coverage and payment.  Several weeks ago, the Department of Health and Human Services (HHS), Office of the Inspector General (OIG) released its latest critical assessment of chiropractic services currently being billed to the Medicare program. The agency’s report, entitled “Medicare Needs Better Controls To Prevent Fraud, Waste, And Abuse Related To Chiropractic Services,”[i] reemphasizes the OIG’s prior findings that the Centers for Medicare and Medicaid Services (CMS) still lacks appropriate safeguards to prevent the submission and payment of improper, sometimes fraudulent claims for chiropractic services to the Medicare program.  This article is intended to highlight the government’s concerns and outline the steps that a provider should take to better ensure that any chiropractic services billed to Medicare qualify for coverage and payment.

I. Improper Chiropractic Claims Remain a Problem:

At the outset, it is important to recognize that in recent years, CMS and its program integrity contractors have taken a number of steps to elevate the level of scrutiny placed on questionable chiropractic claims billed to Medicare. Nevertheless, the OIG has taken the position that considerable work still needs to be done in order to better protect the Medicare program from fraudulent, wasteful and abusive chiropractic billings. For example, the average improper payment rate for Medicare Part B services has been estimated at between 9.9%-12.9%. For chiropractic services, the improper payment rate has been estimated to be between 43.9%-54.1%. About half of all chiropractic services covered by Medicare were not supposed to be covered.  The OIG has estimated that of the nearly $450 million spent by Medicare on chiropractic services every year, between $257 million and $304 million in improper payments are being made every year for chiropractic services.[ii] Over a six-year period, $2.9 billion was spent by Medicare on chiropractic services. Theoretically, this means that at least $1.27 billion was wasted over those six years.

  • Submit claims for services that never occurred.
  • Submit claims for services that were medically unnecessary.
  • Bill for services covered by Medicare but provided other services such as a massage or acupuncture.
  • Falsified patient medical records.
  • Provided services to beneficiaries without a valid license.
  • Offered incentives to patients to receive unnecessary services.

During this six-year period, 11[iii] of the chiropractors were incarcerated and over 500 chiropractors were excluded from participation in the Medicare and Medicaid programs by the OIG for various reasons. The OIG remains concerned that inadequate oversight is continuing to allow fraudulent chiropractors to hide their improper billings from regulators

II. What Solutions Has CMS Tried?

In an effort to spur more detailed documentation, CMS implemented the initial treatment date requirement for claims. This requirement has been more effective than the AT modifier requirement, as 7 out of 8 contractors do check to ensure this requirement is met. In that respect, this is a successfully implemented requirement. However, when audited, this requirement has largely failed due to inadequate documentation. Approximately 86% of all claims that included an initial treatment date did not adequately document the medical necessity of the services provided. Once again, it appears that chiropractors are aware that the initial date is necessary for payment and will include the date regardless of the quality of their documentation.

At the urging of the OIG, CMS has made significant efforts to better educate chiropractors on the importance of proper documentation and which chiropractic services are actually covered by Medicare Part B. CMS has create publications, seminars, and an educational video for chiropractors to learn about services that are covered under Medicare Part B and how to meet documentation standards. Unfortunately, either through lack of provider participation or because of difficulties in accessing the information, this initiative has largely failed.  Many chiropractors and beneficiaries remain ignorant with respect to the  medical necessity, documentation and coverage requirements of chiropractic services under Medicare Part B. For example, one of the educational videos created by CMS is supposed to educate chiropractors on how to meet documentation requirements. This video only received 8,898 views between December 2015 and January 2017. Even if we were to assume that every view was by a licensed chiropractor (which is highly unlikely), it only reached a fraction of the chiropractors participating in the Medicare program. CMS will likely need to implement more changes that may lead chiropractors to utilize educational resources and improve documentation.

III. Would A Medical Review Threshold or Service Limit Work?

Approximately 61% of private insurance plans that participate in the federal employee health benefits program (FEHBP) cover chiropractic services. Of the FEHBP private insurance plans that cover chiropractic services, there are limits between 10 and 60 services per year, with the average plan limiting patients to 21 chiropractic services per year. The concept of limiting the number of services a beneficiary has been proposed by the OIG in the past, but CMS did not agree with this solution.

A medical review threshold is a limit on the number or cost of services before a review of medical necessity must be completed to continue coverage of future services. CMS states that contractors may set thresholds for the number of services allowed before medical review, but may not limit the number of services provided. There is no CMS-level medical review threshold, but as mentioned earlier 2 of the 8 contractors have already set medical review thresholds. CMS-level medical review thresholds are already in place for out-patient therapy specialties such as physical therapy and speech-language pathology. The threshold for these two specialties is monetary, at $1,920. After a beneficiary reaches $3,700 in physical therapy or speech -language pathology services, a medical review s needed for the beneficiary to continue treatment.

The OIG conducted a nationwide review of the percentage of “unallowable payments” made for three groups of beneficiaries, divided by the number of services received in a calendar year. The first group received 1-12 chiropractic services in a year, 76% of which were unallowable payments. The second group received between 12-30 chiropractic services in a year, of which 95% were unallowable payments. The final group received more than 30 chiropractic services in a year, of which every single payment was unallowable. It is worth noting that the two contractors that had set a medical review threshold had no beneficiaries in the last category. Based on this assessment, HHS-OIG estimates that a threshold for medical review between 12-30 services would have saved Medicare between $95 million and $447 million between 2013-2015. Additionally, that same threshold would have saved beneficiaries between $24 million and $114 million in out-of-pocket expenses over the same period. 

IV. HHS-OIG Recommendations:

In addition to highlighting issue with the current system, OIG’s report provided a few recommendations for CMS to consider implementing:

  • Work with contractors to educate chiropractors on the training resources that CMS has already made available to them
  • Educate beneficiaries on which chiropractic services are and are not covered by Medicare Part B, and encourage beneficiaries to report chiropractors that are providing services that should not be covered by Medicare.
  • Identify chiropractors with high-service denial rates or aberrant billing practices, estimate the amount of overpayments made through a statistically significant sample, and recover the overpayments
  • Establish a threshold for the number of services that may be provide before a medical review is needed

V. Chiropractic Basics – Medicare Coverage Limitations: 

Chiropractors diagnose and treat subluxation disorders primarily through manual adjustment and manual manipulation of the spine.  CMS defines subluxation as “a motion segment, in which alignment, movement integrity, and/or physiological function of the spine are altered although contact between joint surfaces remains intact”[iv] More simply put, a spinal subluxation is a purported misalignment of the spinal column that can cause pain and other symptoms in patients suffering from this misalignment.  One question that regularly arises when documenting chiropractic services is:

“How does Medicare expect me to show that evidence of subluxation if present?”

In most instances, a Medicare contractor will review a provider’s documentation to determine if an x-ray has been used, or a physical examination was conducted to document subluxation. Each of these diagnostic methods are discussed below:

• Subluxation determination based on an x-ray. If a provider has determined that a subluxation is present based on an x-ray,[v] a Medicare contractor will likely take into consideration when the x-ray was taken and how much time has elapsed before a course of treatment was initiated. As discussed in Local Coverage Determination (LCD) L34009 published by Noridian Healthcare Solutions, LLC (Noridian), the contractor requires that an x-ray must have been taken at a time “reasonably proximate” to the start of care. Noridian considers an x-ray to be reasonably proximate to the initiation of care if it was taken no more than 12 months prior to or 3 months following the initiation of a course of chiropractic treatment. Understandably, Noridian will typically allow a chiropractor to base his / her subluxation determination on an older x-ray if a beneficiary’s medical records show that the patient has suffered from a chronic subluxation condition (such as scoliosis) for longer than 12 months AND there is a reasonable basis to believe that the chronic condition is permanent.

• Subluxation determination based on an a physical examination. If a provider has determined that a subluxation is present based on a physical examination that has been conducted, a CMS contractor is going to review the medical documentation to determine if two of the following four criteria have been identified during the examination of the patient’s musculoskeletal / nervous system, one of which must be either asymmetry / misalignment or range of motion abnormality. The four criteria examined include:

• Pain/tenderness evaluated in terms of location, quality, and intensity;
• Asymmetry/misalignment identified on a sectional or segmental level;
• Range of motion abnormality (changes in active, passive, and accessory joint movements resulting in an increase or a decrease of sectional or segmental mobility); and
• Tissue, tone changes in the characteristics of contiguous, or associated soft tissues, including skin, fascia, muscle, and ligament.

A limited scope of chiropractic services qualify for coverage under Medicare Part B if they are performed by a licensed, qualified chiropractor. Regrettably, CMS still takes the position that most of the various services offered by a chiropractor are “supportive” in nature rather than “corrective.”  In other words, CMS considers most chiropractic services to be “maintenance therapy,” which is not covered under Medicare Part B. As maintenance therapy, CMS does not consider most chiropractic services to be medically necessary.

So what chiropractic services ARE covered under Medicare Part B?  Frankly, not many. CMS specifically limits Medicare Part B coverage to hands-on manual manipulation of the spine for symptomatology associated with spinal subluxation. Additionally, qualifying hand-held manual devices (where the thrust of the force of the device is manually controlled) may also be used by chiropractors in performing manual manipulation of the spine. Notably, Medicare does not recognize any additional charges associated the use of such a hand-held device.

When documenting a covered service, a chiropractor must note the precise level of the subluxation. Depending on the number of spinal regions involved, one of three Current Procedural Terminology (CPT) codes can be billed:

• CPT Code 98940 (for treatment of one or two spinal regions);
• CPT Code 98941 (for treatment of three or four spinal regions); and
• CPT Code 98942 (for treatment of all five spinal regions).

The five regions of the, from the cervical area (neck) to the coccyx (tailbone) are illustrated below:

Chiropractic Services

When providing chiropractic services that are intended to provide active / corrective treatment, Medicare requires chiropractors to append the claim with an AT modifier.  The AT modifier is intended to denote the fact that “Acute Treatment” for subluxation was provided to the beneficiary.  If a chiropractor bills one of the three covered codes without an AT modifier, the service will be automatically denied as not medically necessary when the claim is processed by your Medicare Administrative Contractor (MAC).

In most instances, properly coded chiropractic services (limited to 98940, 98941 and 98942) will qualify for payment.  Having said that, both CMS contractors and OIG have repeatedly found that just because a claim has been appended with the AT modifier does not mean that the chiropractic services billed were in fact, medically necessary. In multiple audits conducted over the last decade, government reviewers have found that chiropractors have failed to properly document the medical need for services billed to Medicare.

Although Medicare has not placed a limit on the number of chiropractic services that a beneficiary can receive, providers who appear to be billing an excessive number of services will quickly be flagged for medical review by a MAC, a Zone Program Integrity Contractor (ZPIC) or a Uniform Program Integrity Contractor (UPIC). It is essential that you carefully document the medical necessity of any services billed. At present, pre-authorization to confirm the medical necessity of a treatment is only required by two MACs. One contractor sets its threshold for medical review as 12 services per month but no more than 30 services per year. The other sets a threshold of 25 chiropractic services per year.

VI. Documenting Chiropractic Services:

It is important to keep in mind that under Title XVIII of the Social Security Act, §1862(a)(1)(A), services must be medically reasonable and necessary in order to qualify for coverage and payment.  Similarly, Title XVIII of the Social Security Act, §1833(e) prohibits Medicare from paying for any claims that lacks the necessary information to process the claim.  Therefore, regardless of whether the determination of a subluxation has been based on an x-ray or a physical examination, a chiropractor must ensure that complete and accurate records of the encounter are taken.

Experience has shown that in the event of an audit by a CMS contractor, the MAC, ZPIC or UPIC auditing chiropractic services will primarily base claims on a provider’s failure to properly document the medical necessity of the services billed. It is therefore essential that you review and understand your documentation obligations when billing for chiropractic claims. As a first step, you need to review:

CMS Medicare Benefit Policy Manual, Pub. 100-2, Chapter 15, Sections 30.5 and 240.
• CMS Medicare Claims Processing Manual, Pub. 100-4 Chapter 12, Section 220.

Moreover, you should continue to periodically review any LCD guidance on chiropractic services that has been issued by your MAC.  Again using Noridian’s LCD guidance as an example, during an initial visit, the MAC expects a provider to document the following six categories of information when providing chiropractic services:

A. Documentation Requirements – Initial Visit. The following documentation requirements apply whether the subluxation is demonstrated by x-ray or by physical examination:

#1. Family History / Past Medical History.
• Symptoms causing patient to seek treatment;
• Family history if relevant;
• Past health history (general health, prior illness, injuries, or hospitalizations; medications; surgical history);
• Mechanism of trauma;
• Quality and character of symptoms/problem;
• Onset, duration, intensity, frequency, location and radiation of symptoms;
• Aggravating or relieving factors; and
• Prior interventions, treatments, medications, secondary complaints.

#2. Description of the Present Illness.
• Mechanism of trauma;
• Quality and character of symptoms/problem;
• Onset, duration, intensity, frequency, location, and radiation of symptoms;
• Aggravating or relieving factors;
• Prior interventions, treatments, medications, secondary complaints; and
• Symptoms causing patient to seek treatment.

Importantly, the “symptoms” covered in your description of the patient’s present illness are required to be directly related to the level of subluxation. When describing a patient’s symptoms:

• The symptoms should refer to the spine, muscle, bone, rib and / or joint and be reported as pain, inflammation, or as signs such as swelling, spasticity, etc.
• The symptoms documented must be related to the level of the subluxation that has been cited. A statement on a claim that there is “pain” is insufficient.

Finally, the location of a patient’s pain must be described and the symptoms documented must be related to the level of the subluxation that has been cited.  Noridian further requires that the location of pain must be described and whether the particular vertebra listed is capable of producing pain in the area determined.

#3. Evaluation of musculoskeletal/nervous system through physical examination.

#4. Diagnosis. The primary diagnosis must be subluxation, including the level of subluxation, either so stated or identified by a term descriptive of subluxation. Such terms may refer either to the condition of the spinal joint involved or to the direction of position assumed by the particular bone named.

#5. Treatment Plan. The treatment plan should include the following:
• Recommended level of care (duration and frequency of visits);
• Specific treatment goals; and
• Objective measures to evaluate treatment effectiveness.

#6. Date of the initial treatment.

B. Documentation Requirements: Subsequent Visits.  The following documentation requirements apply whether the subluxation is demonstrated by x-ray or by physical examination:

#1. History.
• Review of chief complaint;
• Changes since last visit;
• System review if relevant.

#2. Physical exam.
• Exam of area of spine involved in diagnosis;
• Assessment of change in patient condition since last visit;
• Evaluation of treatment effectiveness.

#3. Documentation of treatment given on day of visit.  The patient must have a significant health problem in the form of a neuromusculoskeletal condition necessitating treatment, and the manipulative services rendered must have a direct therapeutic relationship to the patient’s condition and provide reasonable expectation of recovery or improvement of function. The patient must have a subluxation of the spine demonstrated by x-ray or physical exam as described above.

VII.  Conclusion

It has been more than 20 years since the OIG first identified chiropractic billings as a potential fraud and abuse problem.  To their dismay, the AT modifier requirement, initial treatment date documentation requirement, and educational resources have failed to significantly remedy the level of improper claims for chiropractic services being billed to the Medicare program. In light of the OIG’s latest report, chiropractors should expect CMS and its MAC, ZPIC and UPIC contractors to increase their audits of chiropractic claims.  Providers should also expect to see oversight through education, medical review, limits to the number of services, and documentation requirements.

What should you do?  Get back to basicsWhen is the last time you compared your medical necessity, documentation, coding and billing practices to those outlined in your respective LCD and the Medicare Benefit Policy Manual.

Need help?  Give us a call.  Our attorneys are experienced in representing chiropractors in audits and investigations of their Medicaid and private payor claims.

Robert W. Liles Healthcare AttorneyRobert W. Liles, J.D., M.B.A., M.S., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Liles Parker attorneys represent chiropractors and chiropractic practices around the country in connection with Medicare, Medicaid and private payors claims audits.  We also represent chiropractors in connection with complaints filed against our clients with the State Chiropractic Board.  For a complimentary review and discussion of your issues, you can call Robert at: (202) 298-8750.  

 

[i] Department of Health and Human Services, Office of Inspector General. Medicare Needs Better Controls To Prevent Fraud, Waste, And Abuse Related To Chiropractic. A-09-16-02042. February 2018.
[ii] CMS’s Supplementary Appendices for the Medicare Fee-for-Service Improper Payment Reports for 2010–2015.
[iii] In one case, when an audit was initiated against a chiropractic practice, the chiropractor supposedly falsely reported a robbery had taken place and that medical records were stolen from his car. This triggered a fraud investigation that led to a 63-month fraud conviction, over $1 million in restitution, and a 23-year exclusion for the chiropractor.
[iv] Medicare Benefit Policy Manual, Chapter 15, §240.1.2.
[v] Noridian will usually permit a previous CT scan MRI to be used as evidence if a subluxation of the spine is demonstrated.

Veterans Administration and CMS Announce Partnership to Address Fraud Prevention

(January 25, 2018): On January 23rd, the Veteran Administration (VA) and the Centers for Medicare and Medicaid Services (CMS) announced a “partnership to strengthen prevention of fraud, waste and abuse.”  According to the press release, under this partnership:

“VA plans to capitalize on the advancement in analytics CMS has made by concentrating on its use of advanced technology, statistics and data analytics to improve fraud detection and prevention efforts.  Additionally, in November 2017, VA invited industry experts to provide information on the latest commercial sector tools and techniques to enhance VA’s fraud detection capabilities.  In April, VA will invite these industry experts to demonstrate their capabilities for detecting and preventing fraud, waste, and abuse and recovering improper payments.”

Among other things, we can expect that the VA will begin to employ techniques utilized by CMS such as predictive analytics to identify instances where providers may be exceeding certain benchmarks in procedures, and to adopt techniques utilized by CMS in the provider enrollment process.  The VA may also be looking at outside contractors that also perform functions as  UPICs, ZPICs and RACs.  This, in turn, means that those providers that serve patients covered by the VA should review their compliance programs and billing and claims processing systems to ensure that they cover adequately VA requirements and procedures, and to ensure that they respond adequately to any investigation or threatened payment denials for those patients.

Liles Parker attorneys have significant experience in assisting clients with their compliance programs and in responding to enforcement actions such as audits, payment denials, suspensions and investigations.  Any person seeking additional information in this area should contact Michael Cook at mcook@lilesparker.com or at (202) 298-8750. 

Home Health Pre-Claim Review Demonstration Project Update!

September 20, 2016 by  
Filed under Home Health & Hospice

Pre-Claim Review Demonstration(September 20, 2016): On August 3, 2016, the Centers for Medicare and Medicaid Services (CMS) implemented its “Pre-Claim Review Demonstration” project in Illinois.  This demonstration project effectively requires that Illinois home health agencies submit home health claims for review by the Medicare Administrative Contractor (MAC) or face possible penalties (and be forced to have the claim evaluated through the pre-payment process).  As part of the pre-demonstration project, home health agencies are required to submit a complete set of medical records which show that the claim at issue is associated with medically necessary services, meets applicable documentation requirements, qualifies for Medicare coverage and has been coded and billed correctly.  As the demonstration project has been rolled out in Illinois, many home health agencies have experienced problems with the “affirmation” process.  It has been reported that the MAC has allegedly “missed” documentation that has been submitted and that very few of the claims reviewed have been affirmed by the reviewing contractor.  While CMS has not address these specific points, it has acknowledged that additional refinements in the program are required before expansion can continue. Earlier today, CMS announced that the home health pre-claim review demonstration project is temporarily being placed on hold to allow for additional provider education efforts to be conducted.  These provider educational efforts are expected to focus on the main reasons that pre-claim requests have been “non-affirmed” and the documentation that is required to support a home health claim.  Additional information regarding the home health pre-claim demonstration review project is set out below.

I. Background:

Section 402(a)(1)(J) of the Social Security Amendments of 1967[1] authorizes the Secretary for the U.S. Department of Health and Human Services (HHS) to develop demonstration projects that:

“develop or demonstrate improved methods for the investigation and prosecution of fraud in the provision of care or services under the health programs established by the Social Security Act.”[2]

The home health pre-claim review demonstration project was initiated by CMS due to the increase over the last three fiscal years of improper payment rates for home health claims. On June 8, 2016, CMS announced in the Federal Register[3] that five states would be involved in this new project to collect information to compile a “baseline estimate of probable fraud in payments for home health care services in the fee-for-service [FFS] Medicare program.” These five states include Illinois, Florida, Michigan, Massachusetts, and Texas. Furthermore, the goal of the project was to assess the use of pre-claim reviews as a means of reducing Medicare FFS expenditures for home health services by reducing improper payments while maintaining or improving the quality of care experienced by the beneficiary.”[4]

II. Pre-Claim Review Demonstration Process:

Under the pre-claim review demonstration process requires home health agencies are strongly encouraged to request a preliminary confirmation of coverage by submitting home health claims and associated clinical documentation, for review after services have begun but before the final claim for services is submitted for payment. The home health pre-claim review process is designed to better help ensure that applicable medical necessity, documentation, coverage, coding and billing rules are met before a claim is submitted to Medicare for payment.

The pre-claim review process does not create new clinical home health documentation requirements. Rather, home health agencies are only required to submit the same information they currently maintain for payment. As mentioned, they will do so earlier in the process, which will help assure that all relevant coverage and clinical documentation requirements are met before the claim is submitted for payment. CMS contends that the pre-claim review process will not delay care to Medicare beneficiaries and will not alter the Medicare home health benefit.

Home health agencies in one of the five demonstration states have been advised that if they do not submit their claims through the pre-claim review process, those claims will be flagged for prepayment review and will essentially treated like an ADR.  Moreover, after the first three months of the program, even if found to qualify for coverage and payment, CMS intends to reduce payment by 25% on each claim that is not submitted through the pre-claim demonstration review process.

III. Conclusion:

The decision by CMS to postpone the implementation of the pre-claim review demonstration in Florida was influenced, in large part, by the advocacy of supportive political and home health industry groups.  The postponement of the pre-claim review demonstration project is a major victory for health care providers in Florida, Michigan, Massachusetts, and Texas. Unfortunately, However, the implementation of the demonstration project is inevitable so providers should continue to prepare for the impact it will have on their health care practice. The exact start dates for Florida, Michigan, Massachusetts, and Texas have yet to be announced, but the dates will be provided on CMS’ website at least 30 days in advance to the implementation. Providers can expect a staggered start beginning with Florida, which provides additional time for preparation.

Pre-Claim Review DemonstrationRobert W. Liles, M.B.A., M.S., J.D., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law. Liles Parker is a boutique health law firm, with offices in Washington DC, Houston TX, San Antonio TX, McAllen TX and Baton Rouge LA. Robert represents home health agencies around the country in connection with Medicare audits and compliance matters. Our firm also represents health care providers in connection with federal and state regulatory reviews and investigations. For a free consultation, call Robert at: 1 (800) 475-1900.

 

 

[1] 42 U.S.C. 1395b-1(a)(1)(J).

[2] Id.

[3] 81 Fed. Reg. 37598.

[4] “Pre-Claim Review Demonstration for Home Health Services in Illinois,” available at http://www.palmettogba.com/Palmetto/Providers.Nsf/files/Workshop_Home_Health_PCR_Workshop_Series.pdf/$File/Workshop_Home_Health_PCR_Workshop_Series.pdf

[5] See the Palmetto GBA website for helpful resources, available at http://www.palmettogba.com/palmetto/providers.nsf/docsCat/Providers~JM%20Home%20Health%20and%20Hospice~Home%20Health%20Pre-Claim%20Review.

CMS Seeks to Overhaul Medicare Claims Appeal Process

(July 18, 2016): The Centers for Medicare and Medicaid Services (CMS) has announced a series of proposed changes to the Medicare claims appeal process. The new rules primarily impact the Administrative Law Judge (ALJ) level of review, and CMS has indicated that the purpose of these changes is to help reduce the backlog of pending ALJ hearing requests. As many Medicare providers are aware, the claim appeal process consists of five steps:

  1. A request for redetermination by a Medicare Administrative Contractor;
  2. A request for reconsideration by a Qualified Independent Contractor;
  3. A request for a hearing before an ALJ;
  4. A request for review by the Medicare Appeals Council; and
  5. A request for review in Federal district court

Due to the frenetic auditing activities of CMS’ contractors in recent years – particularly the recovery audit contractors – this system has become overloaded with appeals. This is particularly true with respect to ALJ hearing requests filed with the Office of Medicare Hearings and Appeals (OMHA), where the enormous backlog has prevented OMHA from fulfilling its legal duty to decide appeals within 90 days. As of April 30, 2016 CMS estimates that there are more than 750,000 pending hearing requests. And the backlog only appears to be worsening: the average processing timeframe for an ALJ appeal has increased from 661 days to 819 days between 2015 and 2016.

CMS has stated that the changes to the claim appeals process have two main objectives: to streamline the ALJ hearing process and to increase the number of available adjudicators. Although these new changes impact most of CMS’ existing ALJ appeal regulations, the most significant revisions are summarized below.

  • The Medicare Appeals Council may render binding decisions. In many types of appeal systems, lower courts are required to follow the decisions of higher appellate courts. For example, the decisions of the U.S. Supreme Court are binding on all other Federal courts.

The Medicare Appeals Council is the highest level of appeal within the Department of Health and Human Services, and it is responsible for reviewing ALJ decisions. The Council’s decisions are currently not binding on ALJs or any of CMS’ contractors. The new rules would change this and permit the Council to designate certain decisions as precedential, which means that all of CMS’ contractors and the ALJs would be required to follow them. CMS believes that permitting the Council to render binding decisions would streamline the appeals process and allow for uniformity of some coverage and procedural issues.

  • Attorney Adjudicators will assist with appeals processing. ALJs do not just conduct hearings and write decisions, they also perform a variety of other tasks related to each case, such as: determining if the provider’s appeal is timely, valid, and complete; reviewing the record to ensure all pertinent case materials are present; and determining if good cause exists to admit new evidence offered by a provider.

CMS’ new rules would create new positions within OMHA called “Attorney Adjudicators,” who will be responsible for assisting ALJs with pending appeals. These new decision makers would perform most of the ancillary tasks currently undertaken by ALJs, thereby allowing the judges to focus on holding hearings and issuing decisions.

  • The amount in controversy requirement will increase for some providers. In order to file an ALJ hearing request, the current “amount in controversy” must be at least $150. When determining whether this requirement has been met under the existing regulations, an ALJ will consider the amount billed by the provider to Medicare for the item / service / claim in question.

The new regulation will change the amount in controversy rule for providers who are reimbursed according to a fee schedule, such as physicians, labs, or suppliers of durable medical equipment. In those cases, the amount in controversy will be changed from the amount billed to the amount allowed per the fee schedule. CMS believes that this will reduce the number of appeals submitted to OMHA. It is important to note that, under this new proposed rule, providers will still be permitted to bundle claims together to meet the amount in controversy requirement for an ALJ appeal. For providers who are not reimbursed based on a fee schedule, the amount in controversy rule will continue to be determined according to the amount billed for the claim or service.

These are only three examples of the changes sought by CMS. Many other aspects of the ALJ hearing process will also change, such as when new evidence may be admitted into the record, how cases involving statistical sampling and extrapolation should be handled, and how CMS’ contractors may participate in an ALJ hearing.

In practice, some of these changes may work to the detriment of providers. For example, deeming certain Council decisions precedential would mean that the contractors and ALJs would be required to follow those decisions in identical or similar cases. This could deprive ALJs of independence and flexibility to decide cases based on the unique facts and circumstances of each appeal. CMS does not appear to have offered an estimate as to how many appeals may be affected by this portion of the new rules.

Similarly, the involvement of attorney adjudicators in the process may increase the procedural hurdles encountered by providers during the appeals process. Failure to adhere to most of the procedural requirements for an ALJ hearing request may result in dismissal of the appeal. This increased focus on procedural aspects of the process will likely lead to more providers seeking assistance from attorneys to navigate the increasingly complex hearing process.

Time will tell whether these adjustments to the claim appeal regulations will actually help alleviate the backlog of pending ALJ appeals. The most direct way for CMS to accomplish that result would be to rein in the contractors responsible for the never-ending stream of audits as opposed to tweaking the rules for appeals.

If you have questions about the Medicare claims appeal process or need help with an appeal, you should contact an experienced attorney to discuss your questions and explore your options.

Medicare Claim AppealLiles Parker attorneys assist providers across the country with all matters related to claim appeals, reimbursement, enrollment, compliance, and corporate formation / transactions. If you have questions or concerns about a pending Medicare claim appeal, please contact Adam Bird for a free consultation.  He can be reached at:  1 (800) 475-1906.

CMS Announces Home Health Pre-Claim Review Demonstration Project for Five States

July 5, 2016 by  
Filed under Home Health & Hospice

Pre-Claim Review(July 5, 2016) The Centers for Medicare and Medicaid Services (CMS) has announced a home health pre-claim review demonstration project to be initiated in five states. According to CMS, the purpose of the new project is to prevent improper Medicare payments, enhance quality of care, and deter waste, fraud, and abuse in the Medicare program. This pre-claim review demonstration will impact home health agencies in Illinois, Florida, Texas, Massachusetts, and Michigan.

According to the Operational Guide released by CMS, the general contours of this new project will be as follows:

  • Agencies will continue to submit requests for anticipated payment (RAPs) as usual.
  • At some point prior to submission of the claim for the end of episode (EOE) payment, agencies will be required to submit documentation to the Medicare Administrative Contractor (MAC) that substantiates the beneficiary is homebound, requires intermittent skilled care, and that a physician has certified the beneficiary’s eligibility for home health services.
  • The MAC will render a provisional pre-claim review decision to either affirm or non-affirm coverage of the services within 10 days of receiving the agency’s documentation. The decision letter will contain a rationale for the determination.
  • If the pre-claim review decision is affirmed, the agency can then submit the EOE at the appropriate time and will receive payment as usual.
  • If coverage is non-affirmed upon pre-claim review, the decision letter should contain the reason(s) for that determination. The agency will then have an unlimited number of opportunities to submit additional documentation to further corroborate that the services meet Medicare coverage rules. Those subsequent pre-claim review decisions will either affirm or non-affirm coverage for the claim. MACs will be required to render decisions regarding resubmitted documentation within 20 days of receipt.
  • If an agency submits an EOE after receiving a non-affirmed pre-claim review decision, the EOE will be denied and the RAP will be recouped. The provider will then be able to appeal that denial.
  • CMS has portrayed the pre-claim review process as “voluntary.” However, if an agency submits an EOE without first obtaining an affirmed pre-claim review decision, payment will be immediately stopped and the claim will be subject to pre-payment review. If the reviewer approves the claim upon pre-payment review, the reimbursement for the claim will be reduced 25%. This penalty is non-appealable. If the pre-payment review decision is unfavorable, the RAP will be recouped and the provider may appeal that denial.

CMS and the home health MACs will roll out this demonstration gradually throughout the five target states over the course of six months:

  • Illinois: August 1, 2016
  • Florida: October 1, 2016
  • Texas: December 1, 2016
  • Michigan and Massachusetts: January 1, 2017

In cases where providers do not opt to participate in the pre-claim review process, CMS has stated that the 25% penalty component of the project will be phased in three months after the commencement dates listed above.

According to Palmetto GBA, the home health MAC for Illinois, Florida, and Texas, providers will be able to submit the requested documentation via mail, facsimile, or an online portal.

Home health agencies across the five target states along with other stakeholders have aptly expressed concern as to the need for and potential ramifications of this demonstration project. Agencies are already under enormous pressure, for example, to obtain physician orders within specified timeframes along with appropriate face-to-face documentation from the certifying physicians. The pre-claim review project will only exacerbate those difficulties. In the meantime, agencies will now be expected to continue providing care to beneficiaries without any assurance that they will receive reimbursement for their services.

In our opinion, some of the biggest concerns with this demonstration relate to the timeliness and quality of the pre-claim reviews along with the possibility that the same claims could be subject to multiple audits by different entities.

Although CMS has stated that the MACs will “make every effort” to review pre-claim submissions within 10 days of receipt, there is no assurance they will consistently meet this goal. Unfortunately, the project guidelines announced by CMS do not contain any remedies for providers whose requests may be subject to lengthy processing delays.

The second concern principally relates to the quality of reviews and the adequacy of the explanations provided for “non-affirmed” decisions. Chapter 7 of CMS’ Operational Guide does not contain any requirements as to how detailed those explanations will be. If the MAC’s reasons for “non-affirming” coverage are vague or non-specific, as most unfavorable claim or appeal decisions by Medicare contractors tend to be, then many providers will be left wondering how to improve their documentation or what other records to furnish upon resubmission. This could result in significant delays in reimbursement for many agencies and substantial negative impact on otherwise compliant providers.

CMS has affirmatively stated that claims subject to the pre-claim review process will not be exempt from targeted reviews performed by other entities, such as Zone Program Integrity Contractors. Even the medical review staff at the MAC – the same entity charged with performing the pre-claim reviews – could theoretically initiate targeted medical review of home health agencies. CMS has not indicated whether claims submitted for pre-claim review could also be audited by the Recovery Audit Contractors or the Supplemental Medical Review Contractor. CMS has not offered any justification for the tremendous administrative burdens that serial audits of the same claims could impose on agencies.

In light of this new demonstration project, we recommend that agencies in all of the five states take the following steps to prepare for pre-claim review:

  • CMS has not specified exactly what documentation must be submitted with each pre-claim review request. However, the MACs are currently developing checklists for providers to use when preparing their documentation. Agencies should closely monitor their MAC’s website for this information and review it as soon as it is available. This will likely be an important tool when compiling documentation for submission.
  • Pre-claim review will apply to all home health claims – including recertification episodes – in target states as of the effective dates specified above. For example, initial face-to-face encounter documentation must be submitted with pre-claim review requests for all recertification episodes, even if the face-to-face was performed before the commencement of the demonstration project in that agency’s state. For this reason, providers should not wait to begin reviewing their documentation and searching for ways to improve it. We strongly recommend that providers initiate internal auditing protocols now, irrespective of when the demonstration may begin in their state.
  • Face-to-face documentation will likely play a key role in many pre-claim review decisions. If they have not already done so, we recommend that agencies conduct inservices with their physician referral sources now regarding timeliness and content requirements of face-to-face encounter records. If some physicians consistently refuse to document adequate or timely face-to-face encounters, agencies should consider no longer accepting referrals from those physicians.
  • Agencies should be aware that pre-claim review will likely disrupt their ordinary revenue cycles and begin taking appropriate action.
  • Agencies should regularly review Medicare coverage requirements for home health services as set forth in the Medicare Benefit Policy Manual. Moreover, agencies should familiarize themselves with the local coverage determinations (LCDs) of their MACs, which also contain guidelines for home health care. Palmetto GBA, for example, has LCDs that relate to physical / occupational / speech therapy services and home health care provided to beneficiaries with diabetes mellitus, among other topics.
  • To speed up the pre-claim review process, agencies should submit documentation via the MAC’s secure web portal instead of by mail or fax.
  • We recommend that agencies always utilize the pre-claim review process. The 25% payment reduction is too steep a penalty for non-compliance, particularly since any such claims would still be subject to pre-payment review upon submission of the EOE.

If you have questions regarding this new home health pre-claim review process, you should contact an experienced attorney to discuss additional steps that you could take to minimize the potential negative impact that this initiative will have on your agency.

Pre-Claim ReviewLiles Parker attorneys assist providers across the country with all matters related to claim appeals, reimbursement, enrollment, compliance, and corporate formation / transactions. If you have questions or concerns about a pending Medicare claim appeal, please contact Adam Bird for a free consultation.  He can be reached at:  1 (800) 475-1906.

Medicare’s Home Health Probe and Educate Program is Underway

December 4, 2015 by  
Filed under Home Health & Hospice

Arbitration(December 4, 2015): The Centers for Medicare and Medicaid Services (CMS) has directed its contractors to initiate a home health probe and educate program review process with home health agencies around the country. The focus of this program will be to assess agencies’ compliance with the new face-to-face (F2F) documentation requirements that became effective 01/01/15.

CMS has directed its Medicare Administrative Contractors (MACs) to request records for 5 claims from each home health agency within their jurisdiction to review on a pre-payment basis. This review will apply to claims with dates of service beginning on or after 08/01/15. If the MAC denies one out of the five claims under review, it will send an education letter to the agency summarizing its findings and the process will be complete. However, if more than one of the five claims is denied or if the agency fails to submit documentation in response to the request, then the MAC will send a “detailed” findings letter and repeat the review process with another 5 claims with dates of service on or after the date of the findings letter. The purpose of this second review will presumably be to assess the agency’s compliance with the MAC’s previous education efforts.

As part of the post-review education process, CMS has directed the MACs to offer agency-specific education (to include a one-on-one telephone call with contractor medical review staff) regarding the face-to-face requirements.

Although CMS has not explicitly outlined further consequences for agencies with high error rates determined through this “Probe and Educate” program, it is likely that MACs would continue the review process for delinquent agencies, implement more extensive medical review audits on either a pre-payment or post-payment basis, or refer non-compliant agencies to a Zone Program Integrity Contractor (ZPIC) for investigation. In light of this new ongoing review program, home health agencies should:

  • Continue to obtain supporting F2F documentation on a rolling basis from referring physicians prior to submitting your EOE for the initial certification period. Agencies should not wait until Medicare requests records to obtain F2F documentation from referring physicians.

  • Promptly comply with the MAC’s request for documentation and ensure that all records submitted are complete and accurate. Records should be submitted via the MAC’s online portal or by some trackable method of delivery with signature confirmation.

  • Take advantage of the MAC’s offer to conduct one-on-one education with your agency, even if the review findings are largely positive. As all agencies know, the F2F requirement is extraordinarily vague, and agencies should always take advantage of educational opportunities offered by CMS and the contractors.

  • Contest any and all improper claim denials in the administrative appeals process.

Although the home health probe and educate reviews are, by definition, intended to be educational in nature, they could potentially result in serious consequences for non-compliant agencies. If a MAC has attempted to educate an agency regarding the F2F requirements and a subsequent audit by a MAC or another CMS review contractor determines that the agency has failed to adhere to the previous educational intervention, this could set the stage for an extrapolated overpayment assessment or a payment suspension.

Liles Parker attorneys can assist you with your home health probe and educate obligations.  We also represent home health agencies across the country with all matters related to reimbursement, enrollment, compliance, and corporate formation / transactions. If you have questions or concerns, please contact Adam Bird for a free consultation.

Bird,Adam-WebAdam Bird is a health law attorney with the firm, Liles Parker, Attorneys & Counselors at Law.  Liles Parker has offices in Washington DC, Houston TX, McAllen TX and Baton Rouge LA.  Our attorneys represent home health agencies, hospices and other health care professionals around the country in connection with government audits of Medicaid and Medicare claims, licensure matters and transactional projects.  Need assistance?  For a free consultation, please call: 1 (800) 475-1906.

CMS Awards Zone 6 ZPIC Contract to SafeGuard Services

Audit(August 15, 2015): The Centers for Medicare and Medicaid Services (CMS) has awarded the contract for Zone Program Integrity Contractor (ZPIC) services for Zone 6 to SafeGuard Services, LLC. Zone 6 encompasses Maryland, Delaware, Washington, D.C., Pennsylvania, New Jersey, New York, Connecticut, Massachusetts, Rhode Island, Vermont, New Hampshire, and Maine. SafeGuard is the current program safeguard contractor (PSC) in this jurisdiction, and its functions as a ZPIC will be similar to its duties as a PSC. SafeGuard is also the ZPIC for Zone 1 (California, Nevada, and Hawaii) and Zone 7 (Florida).

As the new Zone 6 ZPIC, SafeGuard will be responsible for investigating suspected waste, fraud, and abuse among Medicare providers. ZPICs have the authority to conduct unannounced, onsite inspections of providers’ facilities, perform pre-payment and post-payment reviews of claims, impose payment suspensions, recommend to CMS that a provider’s billing privileges be revoked, and refer providers to law enforcement for investigation. In our experience, SafeGuard is among the most aggressive ZPICs in the country.

If you receive correspondence from SafeGuard Services or any other ZPIC, we strongly recommend that you contact an experienced health care attorney as soon as possible. You should never assume that ZPIC audits or inspections are merely “routine.”

Liles Parker attorneys assist all types of providers across the country with responses to Zone 6 ZPIC investigations, audits, and other administrative actions. If you have questions or concerns about a ZPIC investigation, please contact our office for a free consultation.

Liles Parker has offices in Washington DC, Houston TX, McAllen TX and Baton Rouge LA.  Our attorneys represent health care professionals around the country in connection with ZPIC audits of Medicare claims, licensure matters and transactional projects.  Need assistance?  For a free consultation, please call: 1 (800) 475-1906.

 

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