All Entries Tagged With: "reimbursement"

Promoting efficient use of resources and appropriate hospitalization length of stay to physicians, a different approach

Physicians sometimes acquiesce to family wishes and desires and admit a patient for “social” reasons. On the other hand, a physician may keep a patient in the hospital an extra day because the patient expresses a desire to stay just “one more day.” These unnecessary, avoidable hospital days have a material effect on potential revenue loss for the hospital through denied days or denied hospital stays by third party payers.

A major challenge in motivating physicians to move the patient along the continuum is the disconnect between prudent hospital fiscal management and the practice patterns of physicians. The physician generally receives payment for his evaluation and management services regardless of whether the hospital is paid or denied for the patient care.

However, change is on the horizon. Medicare is currently considering provisions that will promote efficiency in the practice of medicine. Medicare and other third party payers are also committed to transitioning from physician payment based strictly on volume to payment based upon the relationship between quality, costs, and outcome. The efficiency and effectiveness of a physician’s practice of medicine will determine the physician’s financial welfare and business success.

Evidence of this impending change in reimbursement can be found in the General Accountability Office’s (GAO) report entitled “Per Capita Method Can Be Used to Profile Physicians and Provide Feedback on Resource Use.”  This report is a must read. In essence the report concluded that it is feasible to use Medicare claims data to profile physicians on resource use, taking into account patient acuity through risk adjustment methodologies.

The report examined the following:

• The extent to which physicians in selected specialties show stable practice patterns and how beneficiary utilization of services varies by physician resource use level
• The factors to consider in developing feedback reports on physicians’ performance, including per capita resource use
• The extent to which feedback reports may influence physician behavior

The GAO focused on four medical specialties (cardiology, diagnostic radiology, internal medicine, and orthopedic surgery) and chose four metropolitan areas (Miami, Phoenix, Pittsburgh, and Sacramento).

Take this oppurtunity to educate physicians about the possible changes in the reimbursement model

The message is out!

Now is the time for case managers to become familiar with these eventual changes to the healthcare reimbursement model from a physician and a hospital perspective. This reimbursement model transition will not only drive out waste in the practice of medicine. It will also drive and promote a collaborative approach to healthcare delivery by using financial incentives.

Case managers should educate physicians on the need to collaborate with case management to move the patient along the continuum efficiently because physicians will receive reduced reimbursement for excessive resources.

Let the education begin.

House approves healthcare reform bill

The House passed its version of the bill, can the Senate do the same?

The U.S. House of Representatives recently passed the healthcare reform bill (HR 3962) by a narrow margin (220–215). The bill’s estimated cost is more than $1 trillion over the next 10 years.

The Senate is working on its own version of the bill. If that version passes, then a congressional conference committee will meet to compromise on the two versions. If the committee reaches a compromise, it will send that bill would to both the House and Senate for another vote. If it passes both houses, the next step is President Obama’s desk for his signature.

Preliminary drafts of the Senate bill differ from the House version with respect to funding. how many individuals will be covered, and the availability of a public option.

Source: CNN

Listen to expert interpretation of Condition Code 44 regulations

Condition code 44 is one of those topics that never goes away.

• Can we use condition code 44 if the physician has already written the discharge order?
• Can we use condition code 44 if the attending physician doesn’t concur with the utilization review committee?
• Can we use condition code 44 to change inpatient time to observation services?

For whatever reason questions like these continue to come up. Perhaps it’s the vaguely-worded regulation or the conflicting advice found on the internet. Whatever it is, people are confused.

We at HCPro were thinking that because condition code 44 is such a contentious and confusing topic perhaps a written article is not the best way to explain it. That’s why we decided to call in the experts (Kimberly Anderwood Hoy, JD, CPC, the director of Medicare and compliance for HCPro, Inc and Sandra McCune BSN, RN utilization management specialist) for a 90-minute audioconference that will hopefully put all your condition code 44 concerns to bed.

How and McCune will share their interpretation of the rule using the official guidance provided by CMS. The program includes a 30-minute question and answer portion that will give you the chance to get your burning condition code 44 question addressed by our experts.

Take a listen to the following audio clip I recorded with Kimberly Hoy. In it, she explains why it is important for folks to listen to the program and highlights some of the important information the audience will take away.

If you like what you hear head over to the HCMarketplace and sign up for the program, Condition Code 44 and the Utilization Review Committee: Ensure Process and Documentation Compliance.

Are you paying attention to your case mix index?

What is Case Mix Index (CMI) and why, as a case manager, do I care what that is?  According to the Financial management for nurse managers and executives (3rd ed.), CMI is the measurement of the average severity of illness of patients treated by a healthcare institution.  Basically, CMI helps determine the dollar amount assigned to a diagnosis related group (DRG) for the Medicare population. Medicare assigns a dollar amount for every facility, which is partially determined by the CMI.

Hospitals use the CMI to determine the budget, and if the actual CMI is lower than the budgeted CMI, the incoming money for those DRGs will be less. This causes an imbalance in the hospital revenue. If the money isn’t coming in as planned, a financial fiasco can occur. Think of CMI as the yellow light that warns the hospital of any impending decrease in hospital income. The financial wizards and senior management monitor the CMI on a monthly basis.

Appropriate DRG assignment for each inpatient case impacts the CMI. This is another reason why complete and accurate documentation is important. Coders need thorough documentation to assign the appropriate DRG. Appropriate coding determines the DRG, and the average DRG weight determines the CMI. Case management and clinical documentation improvement specialists can help the coding team by ensuring documentation supports the appropriate diagnoses, which will lead to appropriate assignment of a DRG.

CMI is complex, but essential to the revenue survival of hospitals. CMI is used to adjust the hospital’s average cost per patient. CMS uses the annual CMI to determine the DRG amounts for the next year. CMI is a very complicated concept to grasp, but it is important to remember that CMI is a tool that is used to predict income, outlines patient types, and helps explain the cost of treating a hospital’s population. In the end it goes back to complete, accurate and timely documentation and appropriate coding practices.

Do you know what your institution’s budgeted CMI is and what your actual CMI is?

One year later: How are you handling HAC and POA

Last October, CMS began paying hospitals less for certain hospital-acquired conditions (HAC) that occur in specific situations and are not present on admission (POA). CMS designed the program to save money by ceasing to pay hospitals for conditions that could have been avoided. However, a new study published in the September 9 issue of Health Affairs, estimates that the program has saved $1.1 million to $2.7 million annually.

Before the HACs took effect, many experts warned that the HACs could affect the hospital’s bottom line, but this study suggests that may not be the case. Have they affected your hospital’s bottom line?

The following HAC conditions took effect October 1, 2008:

1. Foreign Object Retained After Surgery
2. Air Embolism
3. Blood Incompatibility
4. Stage III and IV Pressure Ulcers
5. Falls and Trauma

• Fractures
• Dislocations
• Intracranial Injuries
• Crushing Injuries
• Burns
• Electric Shock

6. Manifestations of Poor Glycemic Control

• Diabetic Ketoacidosis
• Nonketotic Hyperosmolar Coma
• Hypoglycemic Coma
• Secondary Diabetes with Ketoacidosis
• Secondary Diabetes with Hyperosmolarity

7. Catheter-Associated Urinary Tract Infection          (UTI)
8. Vascular Catheter-Associated Infection
9. Surgical Site Infection Following:

• Coronary Artery Bypass Graft (CABG) – Mediastinitis
• Bariatric Surgery
  • Laparoscopic Gastric Bypass
  • Gastroenterostomy
  • Laparoscopic Gastric Restrictive Surgery
• Orthopedic Procedures
  • Spine
  • Neck
  • Shoulder
  • Elbow

10. Deep Vein Thrombosis (DVT)/Pulmonary Embolism (PE)

• Total Knee Replacement
• Hip Replacement

If you are finding HAC and POA is an issue at your facility, check out these tips. Garri Garrison, RN, CPUR, CPC, CMC, director of consulting services at 3M Health Information Services in Atlanta, offered the following tips for keeping staff up to speed on HACs and POA in the September 2008 issue of Case Management Monthly:

• Educate case managers on what POA status is and partner with your health information management department to determine where POA codes apply.
• Be aware of new HACs when they’re announced by CMS. “This is just the beginning. It’s likely these conditions will continually evolve,” Garrison says.
• Look at your facility’s current documentation selection tools to see whether they lend themselves to capturing these data on admission. If they don’t, improve them.
• Do a self-audit. Randomly pull 30 charts to see whether they accurately note POA conditions. If you think there are gaps, chances are an auditor will as well.

“If you fail your own audit, you’re going to fail others, such as the recovery audit contractors’,” says Garrison, who describes case managers as “quality of care managers” and points to POA guidelines as “quality indicators.”

For more information on HACs, visit www.cms.hhs.gov

To listen to the HCPro, Inc., audio conference “POA Reporting for Hospital Acquired Conditions: Strategies to Obtain Complete Documentation,” visit www.hcmarketplace.com.

To read the complete article ” Don’t let HACs cut into your bottom line“, visit the ACDIS Web site’s Helpful Resources section.

Here they come: Two RACs post issues eligible for review

Editor’s note:  My colleague, Andrea Kraynak, does a great job staying on top of all the RAC news over at the Revenue Cycle Institute blog. The following is round-up of some of the news she has covered recently in regards to issues eligible for RAC review.

Two of the four RACs have posted issues eligible for RAC review on their Web sites, meaning that RACs can begin auditing in those areas at any time.

Connolly, the RAC for region C, has posted the approved issues for South Carolina and Florida. No word yet on the other states and territories that Connolly covers. However, many experts are advising providers to pay attention to these issues, regardless of whether they are within the Connolly’s jurisdiction.

Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance at HCPro, Inc., says providers outside Connolly’s jurisdiction may want to review the issues as a clue to what RACs might audit in their area. However, she notes that providers should anticipate that RACs will audit for different issues for different jurisdictions although there certainly could be some overlap.

Connolly will focus on the following six issues for both states: [more]

The FY 2010 IPPS changes impacting case managers

On July 31, the Centers for Medicare and Medicaid Services (CMS) released the FY 2010 Inpatient Prospective Payment System (IPPS) Final Rule. Hospital payment rates will increase by an average of 2.1%, as opposed to the 0.2% proposed earlier in the year. CMS elected not to implement a 1.9% reduction, referred to as the coding and documentation adjustment. This coding and documentation adjustment accounts for changes in clinical documentation and coding patterns—not real changes in patient acuity.

Implications for case managers

The start of the Medicare Fiscal Year IPPS, which begins each October 1, brings a host of new coding, payment, and other regulatory changes including updated relative weights for the 745 MS-DRGs. Some MS-DRG relative weights increase—others decrease. Relative weights are a proxy for patient acuity. Higher relative weights signify higher acuity, providing for a higher level of reimbursement, while lower relative weights translate into lower acuity with less reimbursement.

In reviewing the Healthcare Financial Management Association’s (HFMA) recent overview of the Final 2010 IPPS Rule, an interesting point was made that certainly impacts hospitals and case managers. [more]

Surprise! Voluntary refunds don’t protect against RACs

For many providers, self-auditing has become an important RAC preparation tool. Certainly, internal audit results can show where additional education is necessary to ensure appropriate coding, billing, and documentation practices. And this will result in fewer RAC denials, because if practices are correct, the RACs will find fewer errors to deny.

But many providers also assume that reporting errors (and refunding identified overpayments) discovered while self-auditing will protect those claims from RAC review.

Not so, says CMS.

In a recently released FAQ on the CMS Web site, CMS clarified that only one type of self-audit will ensure RACs may not later review the claims, and it probably isn’t the kind of self-auditing that most providers are doing, says Debbie Mackaman, RHIA, CHCO, regulatory specialist for HCPro, Inc.

The FAQ states:

There are two types of self audits. One is commonly called a voluntary refund and is claim based. If the required claim information is included along with the amount of the improper payment, the claim will be adjusted by the claim processing contractor. The RAC will be aware of the adjustment, but the refund does not preclude future review. The second type of self audit may involve the use of extrapolation. If extrapolation is used the claim processing contractor will review the case file to determine if it is acceptable. The claim processing contractor will accept or deny the extrapolation for the issue identified by the provider. If the claim processing contractor accepts the extrapolation, those claims in the universe will be excluded from RAC review.

In other words, if a provider uses an extrapolation that its MAC or FI accepts, the claims are off-limits for RACs. Otherwise, individual claims corrected after a self-audit are fair game.

“This will come as a surprise to a lot of providers,” says Mackaman. “Providers assume if they do a self-audit and correct and report errors, that [the claims] are excluded from future RAC audits. But they’re not.”

Those providers who review claims individually may feel a little less incentive to report errors and refunds they discover since the claims aren’t protected from RACs, but not doing so is a compliance problem. Ignoring a false claim is never a good idea, says Mackaman.

Nor should this news discourage providers from self-auditing in the first place. Providers can use audit results to better understand their risks, to change internal processes regarding areas of concern and to appropriately return reimbursements for claims paid in error, according to Mackaman.

ER case managers must have special skills

A nurse case manager is a definite asset in the emergency room (ER).  An ER case manager benefits the patients, the staff, and the hospital.  The role is multi-faceted and requires superior skills in:

• Quality
• Education
• Communication
• Customer service
• Negotiation
• Creativity
• Risk management
• Knowledge and understanding of insurance requirements and regulatory mandates

It also requires an ability to interact with patients, families, insurance representatives, and caregivers both in the ER and those who are treating the patients in the out-patient arena.

Visits to the ER may have one of several outcomes. Usually, the patient is treated and discharged home with a plan or the patient is admitted to the hospital. It is here that the ER case manager can be most effective to improve the quality of care and prevent readmissions to the ER.

An ER case manager can ensure that each patient who is discharged from the ER has an appropriate discharge plan that is viable and appropriate to assist the patient in recovering and maintaining their health.  A case manager is an expert in confirming the patient can afford any prescriptions provided , is able to be compliant with recommended follow-up visits with  specialists and can assist the patient in connecting with a primary care physician. The nurse case manager can be instrumental in  working with the patient  and their support system to make sure that they understand and have the interest and ability to be compliant with the discharge instructions.

The case manager can enhance the care provided by a busy ER nurse and physician  by assessing situations and family dynamics, listening to the patient and helping them understand the rationale for various tests and the time needed to interpret results. The case manager can assist the ER nurse with patient education and  providing information necessary to maximize  the patient’s health status.

The case manager can also benefit the hospital by working with both ER physicians and admitting physicians to ensure that all acute care admissions meet medical necessity and are admitted to the appropriate level of care.  The case manager can assist with transfers to alternative levels of care such as skilled nursing or rehab when patients do not meet criteria for acute care but are unsafe to return home.  The case manager can arrange home healthcare, physical  and occupational therapy or other appropriate services to help a patient maintain their independence in the home.

Case managers are an integral part of the ER team to improve the quality of care and help maintain fiscal responsibility for resources both in the ER and on the hospital admitting units. Case managers coordinate care and provide patients will all the tools necessary to improve their quality of life and feel their best within any limits of their illness or disability.

“Voluntary refunds” to MACs/FIs

Many providers are taking a proactive approach to the arrival of the Medicare Recovery Audit Contractors (RAC) and performing their own audits. Using the RAC “hot topics,” providers are using those audit outcomes to understand their risks, to change internal processes regarding areas of concern and to return reimbursements for claims that were found to be paid in error.

Once a self audit has been performed and if an improper payment has been identified, what should be the provider’s next steps? CMS Frequently Asked Question (FAQ) #9503 was updated last week to clarify the process of notifying the RAC on self audit outcomes.  If an improper payment related to a specific claim is identified, the provider should report their findings to their Medicare Administrative Contractor (MAC) or their Fiscal Intermediary (FI) if their transition to a MAC has not been completed.

A “voluntary refund” based on the specific claim can be made and the MAC/FI will make the appropriate adjustment. For details regarding the required claim information that is necessary to complete a voluntary refund, contact your local MAC/FI.  According to CMS, the “RAC will be aware of the adjustment, but the refund does not preclude future review.” Providers should create an internal process to identify any claims that have been processed as a voluntary refund.

Editor’s note: This article was originally written for the MedicareMentor blog. Click here to read the original post.