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Regulatory MonitoringArchive for May, 2009
CMS anticipates Recovery Audit Contractor (RAC) automated reviews will begin in late June and July, according to Marie Casey, deputy director of the Division of Recovery Audit Operations at CMS. However, this is not set in stone, she says, noting, “there is some leeway.”
But complex reviews won’t begin until later, says Casey. CMS is aiming to begin certain types of complex reviews (e.g., coding and DRG validation) this fall. However medical necessity complex reviews won’t begin until early 2010. ”
The nature of automated reviews is simpler on the whole, she says, making them an easier choice to roll out first. “The automated reviews are less burdensome on the provider, because there’s no request for medical records,” says Casey, adding that automated reviews are also easier on the RACs themselves to manage.
The further delay of medical necessity auditing is due to the sheer complexity of the reviews. “We’re delaying because it’s more difficult. We are really trying to ensure that when there is a difference of opinion [on the medical necessity determination of the case], the RAC clearly documents their rationale,” says Casey.
Casey says the delay will also help CMS with the rollout of its “issue review team,” a group comprised of members of various agency divisions that will look at questions that come in about policy (e.g., whether the RACs are correct in interpretation of coding guidelines).
The issue review teams will be looking comprehensively at the questions, with staff with varying expertise on the review team, before approving new issues for RAC review, according to CMS Representative Kathleen Wallace, who spoke during a May 28 Region D RAC training session held in Helena, MT.
What it all means
This is good news for providers and RACs. “Not only can providers avoid medical record requests for a few months, but this will allow providers and RACs to get used to the process before moving on to complex reviews that are more complicated and concerning,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
Because complex reviews are on hold until the fall, so too are medical record requests. When they do begin to arrive, they will likely be sporadic at first–at least in Region D. HealthDataInsights, Inc, President and CEO Andrea Denko confirmed during the Helena training session that requests will initially be sporadic but should eventually fall into a pattern. “This cycle of receiving record requests will be helpful to providers,” says Hoy. “People will be able to anticipate when they’ll be getting record requests and be able to plan accordingly.”
The American Hospital Association (AHA) elaborated on CMS’ decision to wait until 2010 to begin the medical necessity reviews in the May 28 issue of AHA News Now. Thirty-two percent of all demonstration program claims denials were for medical necessity, but a CMS study found a 40% error rate for medical necessity denials of inpatient rehabilitation facility claims performed by one of the RACs in the demonstration program, according to the article. “This study validated concerns about the ability of RAC auditors to accurately judge the clinical decisions made by a patient’s treating physician–sometimes three or more years after the care was provided,” according to Rochelle Archuleta, the AHA’s senior associate director for policy.
There is some truth to this, says Casey. “The medical necessity reviews are typically more difficult and include use of clinical judgment that’s not defined in policy.”
Benko indicated that HealthDataInsights is building a system to direct cases to staff members familiar with particular types of care or facilities to help mitigate the potential for errors. HealthDataInsights Corporate Medical Director Ellen Evans, MD, highlighted their clinical review staff’s wide variety of experience. For example, the RAC would direct a cardiac case to a nurse with cardiac experience for review, or a rehab case to someone with rehab experience for review.
Other RAC news
In discussions with AHA this week, CMS clarified the time providers have to use the RAC discussion period, according to a May 28 AHA RAC Program Update. Providers will “have the option to use the RAC discussion period from the date of the RAC Review Results Letter through the date of recoupment of an overpayment–41 days following the date of the demand letter–rather than only through the issuance of the demand letter,” according to the AHA.
In addition, CMS issued a sample demand letter to the RACs, which the AHA shared with the hospital community. This will be only the first sample letter in a series from CMS, says Hoy. Wallace and Denko indicated during the Region D training session that CMS will be developing multiple uniform letters addressing various situations for providers. “This should help providers understand exactly what is going on when they receive RAC-generated demand letters,” says Hoy.
Finally, AHA confirmed in the RAC Program Update that the Government Accountability Office hopes to complete an analysis in November 2009 of the RAC demonstration program and the permanent program implementation.
We invite you to take our comprehensive survey on what your facility is doing to prepare for the permanent RAC program. It should take approximately 10 minutes to complete.
We value your input and appreciate your time and effort in completing this anonymous survey. As a thank you, we will be happy to send you our completed benchmarking report detailing the results of the survey. To receive your free copy of the benchmarking report, you will have the opportunity to separately request one upon completion of the survey. Thank you for your time and consideration.
Q: Are the Medicare Advantage plans included in RAC audits?
Section 306 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (see Appendix A) directs the Secretary of the U.S. Department of Health and Human Services (HHS) to demonstrate the use of Recovery Audit Contractors (RAC) in:1) Identifying Medicare underpayments and overpayments; and2) Recouping Medicare overpayments.Under the demonstration, the Centers for Medicare & Medicaid Services (CMS) pays the RACs on a contingency basis; that is, the RACs receive a portion of what they identify and collect. The demonstration program is designed to determine whether the use of RACs will be a cost effective means of adding resources to ensure correct payments are being made to Medicare providers and to ensure that taxpayer funds are used for their intended purpose. The legislation requires the Secretary to conduct the demonstration for payments made under part A or B of Title XVIII of the Social Security Act (i.e., traditional fee-for-service (FFS) Medicare). Thus the RAC demonstration does not include the audits of payments for Medicare Part C (managed care) or Part D (the prescription drug benefit).
- Reviewing all Coding Clinic guidance dating back to the 1980s. Guidance regarding wound care coding has changed many times since Coding Clinic offered initial advice in 1988. Since then, it has published nine more clarifications. The most recent guidance came in Coding Clinic, in the third and fourth quarters of 2008.
- Implement standardized processes for documenting debridement. Pay particular attention to excisional debridement, as it typically falls under a higher-paying MS-DRG. During the demonstration project, the RACs focused on insufficient terminology in documentation.
- Track debridement cases at your facility. Especially focus on cases for which coders assign ICD-9 procedure code 86.22. Bryant said she started doing this in a homegrown spreadsheet within her system and continues to use coding compliance software to track this procedure information.
- Audit a random sample of patients coded with 86.22. Look for coding errors and fix any inaccurate claims. However, don’t change documentation in a medical record to prove excisional debridement, Bryant said. During a CMS RAC Open Door Forum in 2008, Bryant asked for clarification about how far back hospitals can change medical records. CMS responded that hospitals may amend documentation “in a timely manner,” but did not provide more information. Bryant urged caution here.
- Suggest the need for a standardized appeal letter. If the RAC claims that documentation in a medical record does not support ICD-9-CM procedure code 86.22, but you believe it does, “go back, look at the policy, look at the documentation, and appeal that case,” Bryant said.
Q: If my hospital is not using the latest InterQual criteria, could that chart be pulled by the RAC for fraud?
A: InterQual is merely a screening criteria—CMS doesn’t actually require hospitals to use it. Therefore, use of an older version or a different set of criteria such as Milliman is not inherently a problem. However, because outside entities such as RACs, MACs or QIOs will be reviewing cases, most hospitals choose to use the same version used by their contractors (presumably the version for the year applicable to the case). Additionally, outdated versions may not reflect advances in care and may cause inappropriate screening decisions.
Note that a patient may not meet InterQual inpatient criteria, but still be considered an inpatient upon physician review. InterQual is a screening criteria—it screens for the most likely inpatient and outpatient admissions, but can not take into account every medical circumstance. There are a percentage of patients, who will fail inpatient criteria due to factors not considered in the InterQual criteria that upon physician’s review will nevertheless be appropriate for inpatient admission.
For this reason, each permanent RAC will now have at least one physician medical director who will be involved in developing evidence for individual claims determinations and act as a resource for all reviewers making such individual claim determinations. Additionally, the provider has the opportunity to request that the medical director participate in discussions regarding individual claims denials.
In addition, RACs do not audit for fraud. Their only task is to look for overpayments and underpayments, either due to errors by the hospital or by CMS’ processing systems. RACs are simply looking for incorrect payments, no matter whose fault, and getting that money back to the Medicare Trust Fund after taking their cut. Of course, if a RAC believes it uncovers a fraudulent scheme or set of practices, it may make an appropriate referral to one of the contractors monitoring for fraud, but it is not a part of their scope of work.
Editor’s note: This question was answered by Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
- Region A: Diversified Collection Services, Inc., www.dcsrac.com
- Region B: CGI, http://racb.cgi.com
- Region C: Connolly Consulting, Inc., www.connollyhealthcare.com/RAC
- Region D: HealthDataInsights, Inc., www.healthdatainsights.com/RecoveryAuditContractor.aspx
This Patient Access Resource Center’s quarterly benchmarking report is designed specifically for patient access managers and finance professionals. This report is based on the results of a survey in which we asked your peers to provide information about their registration accuracy rates.
We wanted to compare the results from our previous survey on registration accuracy back in May 2007.
Here, the good news is that more of your peers are tracking accuracy rates than they were 19 months ago. About 25% of managers said they did not track accuracy rates in May 2007, but only 3% say they do not track rates today.
We suspect that is a direct effect of the CMS Medicare Recovery Audit Contractors (RAC) program, which began its nationwide rollout. The three-year demonstration project collected more than $900 million in overpayments.
The California Department of Public Health has collected approximately $1.2 million in fines from hospitals for “never events” and other serious mishaps.
“Never events” are 28 occurrences on a list of inexcusable outcomes in healthcare settings compiled by the National Quality Forum. These adverse events are serious, largely preventable, and of concern to healthcare providers and the public for the purpose of accountability.
The latest round of fines included penalties for incidents such as failure to use respiratory equipment correctly and failure to transfuse a patient. One hospital failed to promptly investigate the alleged sexual assault of a patient by a staff member.
The state plans to use the funds collected via fines for safety and error prevention educational programs.
Source: HealthLeaders Media
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