RECOVERY AUDIT CONTRACTORS
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1 RECOVERY AUDIT CONTRACTORS RAC SUBSCRIPTION SERVICE What are We Learning? May 24, Aegis Compliance & Ethics Center, LLP 1
2 Faculty Brian Annulis, JD Partner, Meade & Roach, LLP Ryan Meade, JD Partner, Meade & Roach, LLP Aegis Compliance & Ethics Center, LLP 2
3 RAC Subscription Service: Webinar Overview RACs: Being Proactive Second Tuesday of each month Discuss one or two high-risk areas for RAC review Review ideas on how to proactively audit Propose operational safeguards RACs: What are We Learning Fourth Tuesday of each month Keep subscribers up-to-date on RAC developments Discuss RAC updates Analyze publicly available decisions involving RACs Pool questions from subscribers 2011 Aegis Compliance & Ethics Center, LLP 3
4 RAC Subscription Service: Webinar Overview Regularly scheduled Webinars will be supplemented, as necessary, with special emergency sessions Administrative Matters Each session will be minutes in duration, including a question and answer session Each session will begin at 12:00 PM CT If you are unable to participate in the live discussion, each session will be recorded and made available in MP3 format 2011 Aegis Compliance & Ethics Center, LLP 4
5 Goals The goals of the RAC Webinars: Teaching/knowledge transfer Practical points Assist organizations to develop in-house methods of managing Please share your thoughts, suggestions (and criticisms) Our Perspective Defend your claims: Appeals process is critical Manage your compliance risks: Compliance implications to a RAC review must be addressed the RAC process is not just about RAC recovery Be proactive and preemptive 2011 Aegis Compliance & Ethics Center, LLP 5
6 Today s Topics and Agenda Taking a close look at 4 case studies/hypotheticals Framework: Hypothetical facts RAC issue involved Discussion esmd 2011 Aegis Compliance & Ethics Center, LLP 6
7 Case Studies 2011 Aegis Compliance & Ethics Center, LLP 7
8 Case Study 1 The RAC requests 5 inpatient records over a 12 month period involving inpatient stays in which the patient is on a ventilator. All 5 cases used a DRG which requires the patient to have been on a ventilator for at least 96 hours. The 5 patient cases have the following facts: Patient 1: Admitted on March 1 and expired on the morning of March 3. Patient 2: Admitted April 1 and discharged April 5 Patient 3: Arrived in the ED from an auto accident on May 1, admitted as an inpatient later that evening, discharged to home on May 10 Patient 4: Admitted June 2 and discharged June 7 Patient 5: Admitted for a coronary bypass surgery on July 1 and suffers complications from anesthesia, placed on ventilator after surgery until July 3, discharged on July Aegis Compliance & Ethics Center, LLP 8
9 Case Study 1 Example of how RAC has framed issue (Region A): MS-DRG Validation for MS-DRGs with Ventilator Support of 96+ Hours (At this time, Medical Necessity is excluded from review) The descriptions of MS-DRGs 003, 004, 207, 870, 927 and 933 all clearly state with ventilator support of 96+ hours. This requires a minimum hospital stay of 96 hours. Claims with admissions of less than 96+ hours have been identified with these DRGs reported, along with claims with length of stay of 5 days or less. It is unlikely for a patient to be on a ventilator for 96 hours with a 5 day length of stay or less Aegis Compliance & Ethics Center, LLP 9
10 Case Study 1 Analyzing the cases: First steps Shadow audit Dealing with results Defense Facts: Patient 1: Admitted on March 1 and expired on the morning of March 3. Patient 2: Admitted April 1 and discharged April 5 Patient 3: Arrived in the ED from an auto accident on May 1, admitted as an inpatient later that evening, discharged to home on May 10 Patient 4: Admitted June 2 and discharged June 7 Patient 5: Admitted for a coronary bypass surgery on July 1 and suffers complications from anesthesia, placed on ventilator after surgery until July 3, discharged on July Aegis Compliance & Ethics Center, LLP 10
11 Case Study 2 The RAC requests 3 patient cases indicating review is for inappropriate hospital to hospital transfer. The 3 patient cases have the following facts: Patient 1: Admitted on March 1 for pneumonia and discharged to home on March 4. Patient 2: Admitted April 1 and transferred to another hospital on April 2. Patient 3: Admitted May 1 and transferred to another hospital on May 4. The second hospital is in the transferring hospital s system, with common governance Aegis Compliance & Ethics Center, LLP 11
12 Case Study 2 Example of how RAC has framed issue (Region B): Hospital to Hospital Transfer Identified MS-DRG inpatient claims improperly reported as a discharge to home rather than as a transfer to another hospital resulting in an overpayment to the transferring hospital. When a transferring inpatient prospective payment system (IPPS) hospital indicates to Medicare that the patient is being discharged to home, the transferring hospital receives a full MS-DRG payment. In these cases, the transferring hospital should have received a per diem payment rate when transferring a patient to another acute-care facility. An overpayment exists when both hospitals (the transferring hospital and the final discharging hospital) receive full MS-DRG payments Aegis Compliance & Ethics Center, LLP 12
13 Case Study 2 Analyzing the cases: First steps Shadow audit Dealing with results Defense Facts: Patient 1: Admitted on March 1 for pneumonia and discharged to home on March 4. Patient 2: Admitted April 1 and transferred to another hospital on April 2. Patient 3: Admitted May 1 and transferred to another hospital on May 4. The second hospital is in the transferring hospital s system, with common governance Aegis Compliance & Ethics Center, LLP 13
14 Case Study 3 The RAC requests 2 patient cases indicating review is for payment to an ambulatory surgery center which should have been bundled into a skilled nursing facility. The 2 patient cases have the following facts: Patient 1: Is an inpatient at a SNF and receives a blood patch at the ASC and is returned to the SNF Patient 2: Is an inpatient at a SNF and receives cataract surgery at the ASC and is returned to the SNF 2011 Aegis Compliance & Ethics Center, LLP 14
15 Case Study 3 Example of how RAC has framed issue (Region C): Payments for Ambulatory Surgical Center Services Provided to Beneficiaries in Skilled Nursing Facility Stays Covered Under Medicare Part A Payment for the majority of Skilled Nursing Facility (SNF) services provided to beneficiaries in a Medicare covered Part A SNF stay are included in a bundled prospective payment made through the fiscal intermediary (FI)/A/B Medicare Administrative Contractor (MAC) to the SNF. These bundled services are to be billed by the SNF to the FI/A/B MAC in a consolidated bill Aegis Compliance & Ethics Center, LLP 15
16 Case Study 3 Analyzing the cases: First steps Shadow audit Dealing with results Defense Facts: Patient 1: Is an inpatient at a SNF and receives a blood patch at the ASC and is returned to the SNF Patient 2: Is an inpatient at a SNF and receives cataract surgery at the ASC and is returned to the SNF 2011 Aegis Compliance & Ethics Center, LLP 16
17 Case Study 4 The RAC requests 2 patient cases indicating review is for short stay for uncomplicated cases. The 3 patient cases have the following facts: Patient 1: Admitted as an inpatient on March 1 for a urinary tract infection and discharged on March 2. Patient 2: Admitted as an inpatient on April 1 to manage asthma symptoms and discharged April Aegis Compliance & Ethics Center, LLP 17
18 Case Study 4 Example of how RAC has framed issue (Region C): Medical Necessity: Kidney & Urinary Tract Procedures DRG 694 RACs will review documentation to validate the medical necessity of short stay, uncomplicated admissions. Medicare only pays for inpatient hospital services that are medically necessary for the setting billed and that are coded correctly. Medical documentation will be reviewed to determine that the services were medically necessary and were billed correctly for MS-DRG Aegis Compliance & Ethics Center, LLP 18
19 Case Study 4 Analyzing the cases: First steps Shadow audit Dealing with results Defense Facts: Patient 1: Admitted as an inpatient on March 1 for a urinary tract infection and discharged on March 2. Patient 2: Admitted as an inpatient on April 1 to manage asthma symptoms and discharged April Aegis Compliance & Ethics Center, LLP 19
20 Electronic Submission of Medical Documentation (esmd) From the CMS website ( opofpage) Currently, Review Contractors request medical documentation by sending a paper letter to the provider. These providers usually have only 2 options for submitting the requested records: 1. mail paper or 2. send a fax 2011 Aegis Compliance & Ethics Center, LLP 20
21 Electronic Submission of Medical Documentation (esmd) CMS intends to give providers a new mechanism for submitting medical documentation. CMS calls this new mechanism the Electronic Submission of Medical Documentation (esmd) pilot. During Phase 1 of esmd, Review Contractors will continue to send medical documentation requests via paper mail and providers will have the option to electronically send medical documentation to the Review Contractor that requested it. CMS plans to go live with esmd Phase 1 in July Aegis Compliance & Ethics Center, LLP 21
22 Electronic Submission of Medical Documentation (esmd) During Phase 2 of esmd, Review Contractors will electronically send documentation requests to providers when their claims are selected for review. CMS plans to go live with esmd Phase 2 in Aegis Compliance & Ethics Center, LLP 22
23 Electronic Submission of Medical Documentation (esmd) The following Review Contractors are planning to participate in the esmd pilot beginning in July 2011: Recovery Audit Contractor (RAC) A RAC B RAC D Medicare Administrative Contractor (MAC) J1 MAC J3 MAC J4 MAC J5 MAC J9 MAC J12 MAC J13 MAC J14 Comprehensive Error Rate Testing (CERT) Contractor Program Error Rate Measurement (PERM) Contractor 2011 Aegis Compliance & Ethics Center, LLP 23
24 Electronic Submission of Medical Documentation (esmd) CMS anticipates that the following Review Contractors may be participating in the esmd pilot beginning on or before December 2011: RACC MAC J1 MAC J2 MAC J6 MAC J7 MAC J8 MAC J11 MAC J7 DME MAC A DME MAC B DME MAC C DME MAC D 2011 Aegis Compliance & Ethics Center, LLP 24
25 Electronic Submission of Medical Documentation (esmd) How Can a Provider Begin Submitting documentation via esmd? In order to send medical documentation electronically to Medicare Review Contractors, providers (physicians, hospitals, etc.) must obtain access to a CONNECT-compatible gateway. Although some large providers, such as hospital chains, may choose to build their own gateway, CMS anticipates that many providers will choose to obtain gateway services by entering into contract or other arrangement with a Health Information Handler (HIH) that offers esmd gateway services Aegis Compliance & Ethics Center, LLP 25
26 Electronic Submission of Medical Documentation (esmd) Are providers required to electronically submit medical documentation? Providers should keep in mind that esmd is completely voluntary. Providers who are content with faxing or mailing documentation to their Medicare Review Contractor may continue to do so. However, providers who believe it would be more efficient to respond to documentation requests electronically are encouraged to contact one or more of the HIHs to determine if esmd services are available to the provider for a reasonable price Aegis Compliance & Ethics Center, LLP 26
27 Electronic Submission of Medical Documentation (esmd) Which Health Information Handlers (HIHs) Currently Offer esmd gateway services? The following HIHs have begun to build esmd gateways, expect to test them with CMS in the Spring of 2011 and go live in July 2011: RISARC IVANS MRO HealthPort Health IT Plus EHRDOCTORS NaviNet In addition to contacting the HIHs that have already built an esmd gateway, providers are encouraged to contact HIHs with whom they already have relationships (e.g., claim clearinghouses, release of information vendor, Health Information Exchange) to identify HIHs who are planning to build an esmd gateway in the near future Aegis Compliance & Ethics Center, LLP 27
28 Electronic Submission of Medical Documentation (esmd) Which brand of Electronic Health Record must I have to use esmd? The esmd allows for the submission of PDF or TIFF files. Therefore, any Electronic Health Record system that is capable of exporting health information as a PDF or TIFF file can be submitted via an esmd gateway. Are providers still using paper records excluded from using esmd? Providers who have paper records may utilize esmd services so long as they have a mechanism to scan the paper records into PDF or TIFF files. Some esmd HIHs specialize in this kind of service. Will providers who use esmd be more likely to get selected for review? No. CMS prohibits review contractors from selecting providers based on their esmd status Aegis Compliance & Ethics Center, LLP 28
29 Follow-Up Questions? Next Lecture: Tuesday, June 14, pm CT/1pm ET 2011 Aegis Compliance & Ethics Center, LLP 29
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