Training Programs
Audits & Assessments
Regulatory MonitoringArchive for October, 2008
HealthDataInsights (HDI), Inc. of Las Vegas, NV, the RAC selected by CMS to begin reviewing hospitals in Region D (initially Montana, Wyoming, North Dakota, South Dakota, Utah, and Arizona), had the most overpayment determinations of any RAC in the demonstration project with 239,205.
However, it also had the most overturned on appeals (11.5%), according to CMS numbers released here in September.
Editor’s note: In the last edition of The RAC Report, we highlighted some of the major differences between the three-year demonstration project and the permanent project. Here are some more, as highlighted on page 25 of CMS’s demonstration evaluation report.
Vulnerability reporting
Demonstration RACs: Limited
Permanent RACs: Frequent and mandatory
Standardized base notification of overpayment letters to providers
Demonstration RACs: Not required
Permanent RACs: Mandatory
Look back period (from claim date to date of medical record request)
Demonstration RACs: 4 years
Permanent RACs: 3 years
Time frame for paying hospital medical record photocopying vouchers
Demonstration RACs: None
Permanent RACs: Within 45 days of receipt of medical record
Quality assurance/internal control audit
Demonstration RACs: No
Permanent RACs: Mandatory
Reason for review listed on request for records letters and overpayment letters
Demonstration RACs: Not required
Permanent RACs: Mandatory
Public disclosure if RAC contingency fees
Demonstration RACs: No
Permanent RACs: Yes
Question: Under what circumstances can a RAC make a finding that an overpayment or underpayment exists without requesting medical records?
Answer: RACs may use automated review (where no medical record is involved in the review) only in situations where there is certainty that the claim contains an overpayment. Automated review must:
- Have clear policy that serves as the basis for the overpayment (“clear policy” means a statute, regulation, National Coverage Determination, coverage provision in an interpretive manual, or Local Coverage Determination that specifies the circumstances under which a service will always be considered an overpayment);
- Be based on a medically unbelievable service; or
- Occur when no timely response is received in response to a medical record request letter.
Source: Centers for Medicare & Medicaid Services.
Facilities can avoid a visit from a Recovery Audit Contractor if they self-disclose using protocols for “internal audit assessments,” says William Malm, ND, RN, partner at Health Revenue Integrity Service LLP.
However, Malm says, the buzz in the industry is many hospitals nationwide have not performed these self-audits because “they figure that the amount of the takebacks, if there are any, will be less than all the self disclosures and costs,” Malm says. “They do not wish to really look that hard at themselves as most of their operating margins are only 1 to 3%. The cost of internal reviews and disclosures they feel sucks up that amount, and they just are better off fighting what others catch.”
Malm suggests one way to begin the RAC defense is to build a database for data mining. It will help you catch trends — does your physician do admits too often rather than filing them as outpatients? Look for patterns of noncompliant behavior, Malm suggests.
CMS revises list of compendia for use in determining a “medically accepted indication” of drugs and biologicals used off-label in anti-cancer chemotherapeutic regimens
On October 24, CMS issued a transmittal recognizing four authoritative compendia for use in determining medically accepted indications for drugs and biologicals used in off-label anti-cancer chemotherapeutic regimens.
Effective date:
June 5, 2008 – NCCN Drugs and Biologics Compendium
June 10, 2008 – Thomson Micromedex DrugDex
July 2, 2008 – Clinical Pharmacology
Implementation Date: November 25, 2008
View the transmittal.
CMS updates common working file (CWF) edits for influenza virus vaccine and pneumococcal vaccine codes
On October 24, CMS updated its CWF edits to include influenza virus and pneumococcal vaccine CPT codes 90655, 90656, and 90669.
Effective date: April 6, 2009
Implementation date: April 6, 2009
View the transmittal.
CMS implements changes to interpretive guidelines for hospital conditions of participation
On October 17, CMS issued updated interpretative guidance for the hospital conditions of participation.
Effective date: Upon issuance
Implementation date: Upon issuance
View the transmittal.
By Hugh E. Aaron, MHA, JD, CPC, CPC-H
It was recently brought to my attention that some (perhaps many) hospitals may be using the condition code 44 process to retroactively convert inpatient cases to observation. The condition code 44 process is designed to allow a hospital to retroactively convert a case from inpatient to outpatient status under certain conditions. However, the fact that CMS permits a case to be converted to outpatient status does not necessarily mean that the hospital may treat the patient as having been in observation from the time of initial admission. Observation care requires an express order for observation. At this point, it is not clear to me that CMS would permit a retroactive observation order for a patient converted from inpatient to outpatient status using the condition code 44 process. In fact, in the MLN Matters article (SE0622) on the condition code 44 process, CMS stated:
The instructions provided in CR3444 and the information in this article should be followed within the framework of an individual hospital’s existing policies and procedures and do not override or supersede other CMS policies or procedures on observation services . . . (emphasis added)
I am, however, still exploring this issue. If I run across any other authority addressing this issue, I’ll report back in a future issue of Medicare Weekly Update.
The report, presented at the fall meeting of the National Association of State Budget Officers, predicts that Medicaid benefits spending will rise 7.3% from 2007, reaching $339 billion in 2008, and increasing annually at an average rate of 7.9% over the next decade, to $674 billion in 2017. The expected growth rate of the overall economy is 4.8%.
Click here to read the full HealthImaging report.
- All records and documentation, including clinical and medical records and claims documentation, required either by federal or by state law for participation in healthcare programs
- All records necessary to protect the integrity of the hospital’s compliance process and to confirm the effectiveness of the program, including documentation that employees were adequately trained, reports from the hospital’s hotline (including the nature and results of any investigation conducted), modifications to the compliance program, self-disclosure, and the results of the hospital auditing and monitoring efforts.
Get blog updates in your e-mail
Subscribe to our free RAC Report e-zine
