Training Programs
Audits & Assessments
Regulatory MonitoringArchive for September, 2008
As we reported in The RAC Report September 4, Medicare Secondary Payer (MSP) RACs collected $12.7 million in its demonstration project. Although CMS discontinued the MSP RACs, it will still check for MSP compliance in the nationwide permanent program. We shared two tips regarding MSP compliance with you in the last edition.
Check out two more MSP tips below:
- Verify that your current processes are working. Review a sample number of MSPs on a consistent basis. For example, review all inpatients or all ED patients or a sample of all types of registration either weekly or monthly. The minimum should be 10% or 30 records per your review period for a productive sampling.
- Review your current MSP processes for opportunities to improve. Look at the training materials, the accuracy rates and the processes you have in place to see where and what you can improve on. Ask staff members what gives them the most trouble, and customize your training or re-training focus in that area.
Editor’s note: These tips were provided by Stephanie Smithson, CHAM, patient access manager at Dunn Memorial Hospital in Bedford, IN. Her facility scored 100% on a recent federal MSP compliance audit.
As we reported in the last edition of The RAC Report, CMS released its “Summary Evaluation Report” on the RAC demonstration project, where it said it identified $992.7 million in overpayments. We shared with you two of the CHA’s main concerns in its July memorandum to CMS.
Here are two more:
- CMS states that only 4.6 percent of total funds collected have been overturned as the result of appeals. This assertion is premature. At the time of the report, millions of dollars in claims were still pending decisions at various levels of appeals. The appeals process can take as long as two to three years to achieve resolution. Based on our experience thus far, we anticipate that many of these appeals will ultimately be decided in favor of the provider. The amount of reimbursement that will be returned to providers will consequently grow steadily over the next two to three years.
- The net amount of recovered funds will also be reduced by re-billing certain claims. Guidance for re-billing of certain one-day stays as observation was not provided until April of this year. As a result, these outstanding claims are not reflected in the report.
Regarding these concerns, Rep. Lois Capps, D-California, wrote a letter to Tim Hill, Office of Financial Management director at CMS, September 5 asking for a response to concerns such as these of the CHA. Capps wrote he is concerned with what the CHA calls a lack of communication between CMS and providers during the demonstration project. Capps asked Hill to respond by September 22.
You can never be too prepared for the RACs, regardless when they come to your facility. Here’s a starting place to help your facility get “RAC ready”:
- Create a RAC operational team/steering committee at your facility:
- Include members from HIM/coding, PFS, UM/UR, medical director, nursing, nurse auditor, administrative representation, ancillary department heads (therapy, etc), decision support, finance, IT, compliance/legal
- Identify a physician champion
- Perform GAP analysis to identify risk areas:
- Conduct pre-emptive audits
- Do your own data mining – find your own errors and fix them before the RAC finds them
- Implement DRG validation audits
- Monitor your upcoding/downcoding
- Assign a nurse auditor to review medical necessity and other identified high-risk areas
- Audit billing compliance
- Review bill error/correction reports from your scrubber
- Review claim edits
- Check incorrect units billed
- Analyze pharmacy/ancillary charges in your chargemaster
- Verify units of service
- Verify correct dosages
- Review medical necessity screening process of all admissions
- Tighten up screening where necessary
Editor’s note: These tips came from The RAC Report advisory board member Tanja M. Twist, director of patient financial services at Methodist Hospital in Arcadia, CA. Twist is the finance chair for the American Association of Healthcare Administrative Management (AAHAM) who has fought Congress on Capitol Hill for better transparency and answers to hospital concerns with RACs. For more tips from Twist, see the next edition of The RAC Report October 2.
Hospitals will likely begin receiving demand letters for medical records from Medicare’s Recovery Audit Contractors (RACs) as early as this coming January, according to a CMS official.
Tim Hill, Office of Financial Management director at CMS, says hospitals can expect to see the requests in January 2009 as the RAC permanent project begins, the American Hospital Association reports.
CMS had not listed an exact start time for the permanent RACs until Hill’s announcement. CMS is expected to announce who the permanent RACs will be by October 1.
To read more about the timeline of the nationwide RAC rollout, click here.
Demand letters from Medicare’s Recovery Audit Contractors (RACs) may be arriving in your facility’s mailboxes by January.
Tim Hill, Office of Financial Management director, says hospitals will probably start receiving requests for medical records and the demand letters by January 2009, the American Hospital Association reports.
CMS had not listed an exact start time for the nationwide rollout in the permanent program. Now, providers have a clue the initial rollout should begin in January. CMS is expected to announce the permanent RACs by Oct. 1.
It is the same date the RACs are to begin education and outreach to providers, the AHA reports.
To read more about the timeline of the nationwide rollout, click here.
CMS posted new instructions for the revised Advance Beneficiary Notice of Noncoverage (ABN) form.
Last month, CMS had pushed back the mandatory date for using the new form from September 1, 2008 to March 1, 2009. Providers may still use the revised ABN for all situations in which Medicare payment is expected to be denied.
The revised ABN, CMS says, replaces the existing ABN-G (Form CMS-R-131G), ABN-L (Form CMS-R-131L), and NEMB (Form CMS-20007). Beginning March 1, 2009, the ABN-G and ABN-L will no longer be valid.
Staten Island University Hospital settled for fraudulent billing again. For the third time in a decade, the hospital will pay millions of dollars ($88.9 million this time) to settle civil charges for knowingly overbilling the government, the New York Times reports.
Two charges came thanks to whistle-blowers: one a former doctor, the other a widow of a cancer patient.
To read more in the New York Times on this story, click here.
The palliative care teams, usually consisting of a doctor, nurse and social worker, can help reduce hospitals’ costs from lengthy intensive care stays or unnecessary tests by guiding patients and their families to make more informed decisions and rely on resources available to them.
Special care teams focus on the sickest 5-10% of patients with the most difficult cases. Many of these patients also have Medicare coverage, so hospitals often lose money on them because they are paid only a set fee per admission.
To read the full Reuters report, click here.
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