Author Archive for: Andrea Kraynak, CPC-A
Have you had an experience with Medicaid Integrity Contractors?
July 2nd, 2009 
If you’ve had experience with Medicaid Integrity Contractors (MIC), we want to hear from you!
If you are interested in sharing your experience or story, and possibly participate on a live audio conference on the MICs, please e-mail Andrea Kraynak at akraynak@hcpro.com for more information.
Thank you!
CMS releases 2010 OPPS proposed rule
July 2nd, 2009
Changes for separately payable drugs, physician supervision
Outpatient facilities and pharmacies hoping to see an increase in reimbursement for separately payable drugs in CMS’ 2010 OPPS proposed rule didn’t get their wish, but they did see additional proposed guidance on physician supervision rules.
CMS also proposes to allow hospitals to bill Medicare for pulmonary and intensive cardiac rehabilitation services.
“My sense when I first looked at the proposed rule this year was that it seemed much shorter,” says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC. One reason for that, Shah says, might be because CMS chose not to add any additional composite APCs or additional outpatient quality indicators.
That doesn’t mean CMS is abandoning its commitment to “value-based” purchasing principles, Shah says, but it does seem like CMS is taking some time to assess the impact of its current composite APCs before adding additional ones.
Reimbursement for separately payable drugs Providers and various stakeholders have repeatedly weighed in to CMS over the past four years that charge compression has a huge negative impact on how it computes payment rates for separately payable drugs. CMS acknowledges this as an issue, and in its discussion on how it calculated payment rates for 2010, CMS referred to the pharmacy stakeholders’ proposal.
Although CMS analyzed the pharmacy stakeholders’ proposal, the agency elected not to use that methodology nor did it follow the APC Advisory Panel’s recommendations. Instead, CMS introduced a new calculation method: the result is that CMS’ proposed payment for 2010 for all separately payable drugs of average sales price (ASP) plus 4% came as a total surprise, says Shah.
“The fact that the 2010 proposed payment rates for separately payable drugs remains the same as what we have today, despite the CMS’ new calculation methodology is truly disheartening,” says Shah.
CMS’ new methodology does shift some packaged drug costs to separately payable drugs, but falls quite short of covering what providers would consider their drug acquisition costs and pharmacy overhead/handling costs, says Shah.
Shah cautions that an in-depth reading of the information is required to analyze how CMS arrived at the payment rate.
“To the end user – hospitals paid under OPPS - if the proposed payment rate of ASP plus 4% is made final for 2010, then nothing will look different,” Shah says. She is hopeful that hospitals will weigh in on this and other CMS proposed changes.
“CMS’ proposal is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Some estimates provided to CMS indicate that adequate coverage of drug acquisition costs and pharmacy overhead would result CMS paying closer to ASP plus 13% for separately payable drugs, Shah says. Alternatively, CMS could reimburse hospitals at ASP plus 6% and provide a separate add-on payment for pharmacy handling/overhead costs similar to what the pharmacy stakeholders group proposed and APC Advisory Panel supported.
“Unfortunately, CMS’ proposal for 2010 is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Physician supervision and incident to
CMS proposes to allow physician assistants, nurse practitioners, clinical nurse specialists, certified nurse midwives, and clinical psychologists to provide supervision of hospital outpatient therapeutic services when their license allows them to do so.
“The fact that they are going to be able to do the supervision is a huge benefit to hospitals,” says Kimberly Anderwood Hoy, Esq., CPC, director of Medicare and compliance at HCPro, Inc., in Marblehead, MA. Under last year’s clarification, hospitals were not be able to bill for services supervised by a nurse practitioner unless a physician was present.
“This really expands the number of people who can provide supervision, and that is really important in rural areas,” Hoy says.
However, Hoy cautions that the change, if finalized, would not go into effect until 2010, so hospitals must still follow the current rules for 2009.
“The fact that we see so much discussion in the 2010 OPPS proposed rule on this topic is a testament to providers and other industry organizations for a raising tough questions with CMS on its physician supervision and incident-to language over the past 12-16 months”, says Shah.
CMS added a discussion of its expectation that the supervising physician or nonphysician practitioner to be able step in and assume providing the service. In addition, the supervising practitioner can’t be occupied with any other procedure he or she can’t leave.
“That begs the question about whether the emergency physician is always appropriate to use to provide supervision,” Hoy says.
CMS did clarify its definition of what “in the hospital” means, which will be very helpful, Hoy says. Under the proposed change, “in the hospital” would mean areas in the main building(s) of the hospital that are under the ownership, financial, and administrative control of the hospital; are operated as part of the hospital; and for which the hospital bills the services furnished under the hospital’s CMS Certification Number.
“There are some very provider-friendly things . . . but those don’t go into effect until 2010,” Hoy says.
Hoy also recommended facilities carefully read the physician supervision requirements for cardiac and pulmonary rehabilitation services.
“There’s a nice opportunity for hospitals to expand those programs because it’s going to be a little easier to operate,” Hoy says.
Additional proposed changes
CMS proposes to evaluate surgically implantable biologicals that are not receiving pass-through payment before January 1, 2010, for pass-through status using the device category pass-through process. CMS has also proposed to increase the separately payable drug packaging threshold to $65 (it is currently $60) and to package 5HT3 antiemetics.
CMS is also considering paying rural providers for kidney disease education services furnished on or after January 1, 2010, to Medicare beneficiaries diagnosed with Stage IV chronic kidney disease.
CMS will accept comments on the proposed rule until August 31, and will respond to comments in a final rule to be issued by November 1.
CMS releases RAC audit phase-in strategy: Complex reviews to arrive as soon as August
June 26th, 2009
CMS released further information June 24 on its RAC Web site letting healthcare providers know when they can expect RACs to begin auditing. The new “CMS RAC Review Phase-in Strategy,” details different types of reviews and dates CMS anticipates the reviews will begin in various areas of the country.
The new information is consistent with CMS’ previous indications that some providers may begin to undergo automated review this month.
According to the CMS, the earliest possible dates for RAC reviews in yellow and green states are:
- June 2009-Automated reviews of black and white issues
- August or September 2009-Complex reviews for DRG validation
- August or September 2009-Complex review for coding errors
- Fiscal year 2010, which begins October 1, 2009-Complex reviews for durable medical equipment (DME) medical necessity
- Calendar year 2010-Complex reviews for medical necessity
The earliest possible dates for reviews in blue states generally fall a bit later:
- August 2009-Automated reviews of black and white issues
- October or November 2009-Complex reviews for DRG validation
- October or November 2009-Complex review for coding errors
- Fiscal year 2010-Complex reviews for DME medical necessity
- Calendar year 2010-Complex reviews for medical necessity
CMS also reaffirmed that before RACs actively begin auditing in a particular state, outreach educational sessions must occur in that area.
Although the schedule calls for automated reviews as early as this month, any issue a RAC reviews must be vetted through the CMS’ “Issue Review Board.” In addition, RACs must post the approved issues to their Web sites before the reviews can begin.
“Providers should check their RAC’s Web site often for any newly approved issues for review to anticipate their vulnerability to reviews and take backs,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
Even though CMS has delayed the rollout of certain types of complex reviews, providers shouldn’t ease off on their RAC preparation activities.
“Use the time wisely to continue performing your own internal vulnerability audits and ensure that all of your policies and procedures are up-to-date. Consider this a little extra time to get your facility ready for those appeals,” says Tanja Twist, MBA/HCM, director of patient financial services at Methodist Hospital of Southern California.
Editor’s note: Twist and Hoy will be speaking at the upcoming conference, “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status and the Role of Physician Advisors,” which will be held in Atlanta this October. Twist will also be featured in the July 21 HCPro audio conference, “Medicare Appeals: Practical and Compliant Procedures for Overturning Denials.”
MedicareFind. The Search is Over.
June 10th, 2009
The Search is Over.
HCPro, Inc. has announced the launch of MedicareFind (www.medicarefind.com), a new Web-based regulatory database that allows healthcare managers to quickly locate, access, and keep up with Medicare reimbursement rules and regulations.
MedicareFind expands HCPro’s products and services that assist healthcare providers with monitoring and responding to the changing regulatory environment in which they work. The Web site features a uniquely robust, flexible, and easy-to-use search engine combined with a vast and constantly updated database of documents. Users will find the specific regulatory source authority document they need quickly instead of scrolling through pages of search results.
MedicareFind first debuted in April at The Health Care Compliance Association’s annual Compliance Institute in Las Vegas. Institute attendees stepped up to take a side-by-side challenge which pitted MedicareFind against the CMS Web site.
“MedicareFind found the right documents faster than a CMS search every time,” said Lauren McLeod, HCPro Group Publisher. “People found it easy to use and liked the filters that allowed them to narrow their search by agency, document type, and date. They told us it was easier to quickly determine whether the document met their needs because they saw all the pertinent details about the document in the search results.”
HCPro regulatory experts and developers worked with 50 development partners — professionals from healthcare organizations across the nation — throughout the development of MedicareFind. McLeod said the partners have been an integral part of the development process, from determining which rules and regulations to include in the database to testing the site design and the search features.
With shrinking workforces and limited budgets, MedicareFind was developed in response to the need for a solution that offers increased productivity and time saved searching for the regulatory compliance guidance.
MedicareFind is available to single users or as a multi-user or site license, and HCPro will offer free trials at the database Web site (www.medicarefind.com) For more information about MedicareFind, visit www.medicarefind.com.
Revenue Cycle Institute posts free ABN Audit Preparation tool
June 1st, 2009
Help ensure your facility properly obtains ABNs from patients for Medicare noncovered services with this auditing checklist.
Click here to download the sample ABN Audit Preparation tool.
Editor’s note: This sample tool is excerpted from the Medical Necessity Training Toolkit, published by HCPro, Inc.
CMS updates RAC audit timeline: Complex reviews still months away
May 29th, 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.
Top 10 lessons learned from the RAC demonstration program
May 14th, 2009
The RAC demonstration project has come and gone, but many providers learned valuable lessons during the process. Consider the following advice from providers and other experts who have experienced RACs first-hand, and lived to tell about it.
- One of the most important lessons Tanja Twist, MBA/HCM, director of patient financial services for Methodist Hospital in Arcadia, CA, learned from the demonstration project was the need to diligently track and monitor all correspondence to and from the RAC. “This goes beyond tracking the date you send or receive the actual documents (e.g., determination letters, medical record requests and appeals) or send the medical records, but should include tracking the receipt of the documents by the RAC to ensure you are responding timely.” Send everything via certified mail with a return receipt, she suggests. And make sure you are educating your entire facility-not just the mailroom-on what the RAC documents will look like so that correspondence will get to the right person or department. “Don’t assume that because you are able to identify a recipient for correspondence that the RAC will get it right every time,” she says.
- Tracking appeals was the single most important way to survive a RAC audit because it allows you to prioritize your appeals, says Stacey Levitt, RN, MSN, CPC, director of patient care management at Lenox Hill Hospital in New York City. “This way you can spend your available time where you get the biggest bang for your appeal effort.”
- Having a strong physician advisor program-not just having the concept on paper, but an available and active physician participant reviewing and interceding when appropriate-is critical for surviving RACs, according to Yvonne Focke, RN, BSN, MBA, revenue cycle director at St. Elizabeth and St. Luke Hospitals in Covington, KY. “Having such an advisor strengthens your compliance program which is more defensible when appealing cases, especially once they reach the Administrative Law Judge,” she says.
- It’s important for hospitals to regularly assess the effectiveness of their concurrent Medicare admission review processes, according to Joe Zebrowitz, MD, executive vice president for Executive Health Resources. Hospitals have to get the Medicare patient’s status correct every time. Establish a strong utilization review plan that follows Medicare’s Conditions of Participation. But a good plan does not solely ensure good results. You must make sure that the plan is being followed every day and that your case managers are using criteria to review all Medicare admissions and that every case that does not meet the criteria is undergoing a second-level review by a physician advisor, according to Zebrowitz. This physician advisor must be well versed in medical necessity regulatory guidance and use evidence-based medicine and risk stratification protocols to establish correct patient status. Your organization should also conduct retrospective audits on an ongoing basis to identify incorrect certifications from the past and self-disclose these errors, he says.
- Remember that RAC contractors are authorized to refer cases for investigation to the OIG when fraud or abuse is suspected, says Nancy Beckley, MS, MBA, CHC, of Bloomingdale Consulting Group, Inc.
- Take advantage of the 15-day rebuttal period prior to the actual appeals process, says Focke. “Even if only 10% of our cases were spared from this process, it was worth pursuing,” she says.
- Fran LaPrad, RHIT, CPHQ, director of health information at AdCare Hospital in Worcester, MA, had difficulty communicating with her RAC during the demo. LaPrad hopes communication will improve during the permanent program but suggests you should follow up voice mail messages with official letters if you don’t receive a phone call back within the allotted time.
- Zebrowitz also calls out the importance of physician education and collaboration. Many physicians working in hospitals do not have a firm understanding of the regulatory guidance on inpatient versus observation status certification and, more importantly, the ramifications of getting the status wrong, he says. It is your hospital’s responsibility to educate your physicians on the importance of documenting all of their concerns and findings in order to demonstrate medical necessity for all inpatient admissions. You also need to encourage strong collaboration between treating physicians, case management and physician advisors as they work to correctly certify each Medicare admission, ensuring that your hospital will be in compliance with the law and reimbursed appropriately, says Zebrowitz.
- The care management department at is becoming more and more important as the RAC program moves forward, says Focke. “Historically, care management departments have had a difficult time in justifying their existence because they were seen as a cost center that did not generate revenues,” she says. “But the value of having a compliant program has escalated with the advent of RACs and other regulatory agencies.”
- If you have the capability, scan all documentation to and from your RAC (including your medical records), says Twist. As you move through the appeals process, you will find that having the documents stored electronically will ease the process, she says.
Revenue Cycle Institute posts free Chargemaster tool
May 1st, 2009
Each month the Revenue Cycle Institute posts a free tool we hope you will find useful. This month, our sample tool is a Chargemaster Review List.
There are myriad ways to review a hospital’s chargemaster or the chargemasters for a system of hospitals. Download our free sample list to help guide you in your approach to a chargemaster review.
Click here to view this and other free tools available.
