Auditing and Monitoring in Smallville, U.S.A.
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1 Auditing and Monitoring in Smallville, U.S.A. Able to Leap Short Buildings in a Single Bound... Or Maybe Two! Kirk Ruddell, CHC HCCA Compliance Institute April 23-26, 2006 Las Vegas, Nevada
2 Background Facilities with active compliance programs % % Auditing/Monitoring is one of 7 elements in the OIG Compliance Program Guidance for Hospitals CO s top goal on 2005 survey: Auditing and monitoring
3 Island Hospital Anacortes, WA 44-bed hospital and 2 clinics Home Health agency 100 community providers 475 employees Pediatrics, ophthalmology, optometry, oncology, OB/GYN, cardiology, orthopedics, dermatology, respiratory medicine, psychiatry, urology, IP/OP surgery, sleep medicine, sports medicine
4 Island Hospital (cont.) Level III emergency department Rehab (PT, OT, speech therapy) Birth Center Cancer Care Center Sleep Disorders Center Cardiopulmonary Rehab Diagnostic services X-ray, CT, US, mammo, MRI, arteriography, NM, full-service lab
5 Definitions Auditing After the fact One-time event Often done by objective party Monitoring Contemporaneous Regular and ongoing Performed by operator of system Assessing Determine progress or status Quantitative Often uses checklists
6 Why Do It? Recommended by government as part of the 7 elements of a compliance plan Can t have an effective compliance plan without it OIG Ensure policies/procedures are being followed and are effective Identify areas of greatest risk Catch problems early (and before gov t does!) ID trends or systematic problems Part of investigation Guidance for education and training
7 PLANNING YOUR WORK
8 OIG Work Plan FY 2006 Inpatient-only services in an outpatient setting Outpatient surgeries Unbundling of hospital outpatient services Critical Access Hospitals cost reports Purchasing rebates and cost reports Medicare Part B radiology payments for inpatients Ground ambulance services
9 OIG Compliance Program Guidance for Hospitals Billing for items or services not actually rendered Providing medically unnecessary services Upcoding DRG creep Inpatient-only services in an outpatient setting Duplicate billing False cost report Unbundling Billing for discharge in lieu of transfer
10 OIG Compliance Program Guidance for Hospitals (cont.) Patients freedom of choice Credit balances failure to refund Incentives that violate the anti-kickback statute (AKS) Joint ventures Financial relationships between hospitals and hospital-based physicians Stark EMTALA
11 OIG Compliance Program Guidance for Hospitals (cont.) Annual review of 7 elements Interviews Questionnaires Medical and financial record reviews Review results to CEO and governing body at least annually, specifying corrective action if needed
12 OIG Supplemental Compliance Program Guidance for Hospitals Substandard care and billing HIPAA Billing substantially in excess of usual charges Discounts to uninsured patients Gifts and gratuities to patients Cardiac rehab billing Compensation arrangements with physicians Physician recruitment Outpatient coding Gainsharing arrangements
13 Your Investigations Audit findings may become ongoing monitor Example: Ambulance transportation of nonemergent patients Medical necessity issue Task force mapped process and developed forms (see examples) Took about 2 months Follow-up probe audit
14 Settlement Agreements and CIAs Settlement agreements Journals Magazines E-zines Newsletters This Week in Corporate Compliance (TWCC) Corporate Integrity Agreements (CIAs) notification OIG website
15 Comprehensive Error Rate Testing Program (CERT) Federally mandated program to monitor and improve the accuracy of Medicare payments to providers Documentation requests on randomly selected claims Not really helpful, unless outliers identified Probe notification 40 more claims
16 Hospital Payment Monitoring Progam (HPMP) Generates a report called PEPPER (Program for Evaluating Payment Patterns Electronic Report) Summary statistics of claims with comparison to other hospitals in state Very useful for pinpointing auditing areas Not a report of claims errors May not be universally available as state QIOs not required to release it See PEPPER example
17 How Do I Choose? Risk assessment OIG understands that small hospitals have limited resources Affordable, supportable, relevant Address areas of greatest risk first See Health Care Compliance Professional s Manual, Risk Assessment in Small Hospitals Federal Sentencing Guidelines A&M mandatory Periodic evaluation of effectiveness Ongoing risk assessment See workplan example
18 WORKING YOUR PLAN
19 Who Will Do the Work? You Subject matter experts in your organization Outside expert consultant Suggest limit to C of I situations; or Where statistically accurate sampling is a must and/or payback to Medicare is involved
20 Some Practical Notes and Tips Assess processes as well as audit outcomes Use checklist rather than collect numerical data Test billing/coding staff Mock surveys Interviews and questionnaires Review policies and procedures Audits frequently lead to monitoring... Which may lead to other audits!
21 Sampling Necessary because entire population is too large Risk: Wrong conclusions Common sampling methods Block Haphazard Systematic Attribute Statistical random (e.g. RATSTATS)
22 Sampling (cont.) Sample size Lots of opinions, no consensus Subjective Population variability Expected error rate Acceptable error rate Resources Defensible? Acceptable error rate? < 5% is good rule-of-thumb
23 Sampling (cont.) Statistical random sampling Hire a consultant Enhances accuracy and objectivity Visit the vendors in the exhibit hall
24 More Practical Notes and Tips What if I discover evidence of illegal activity? Shut it down! Contact an attorney Attorney-client and work-product privilege Consult with attorney regarding disclosing to FI or using OIG Disclosure Protocol View A&M as process improvement Continuous feedback loop (see monitoring feedback loop diagram)
25 DOCUMENTATION, REPORTING, AND IMPROVEMENT See A&M report examples The tone at the top Both CPG and FSG stress role of the governing body and senior management Use words like knowledgeable, reasonable oversight, and active involvement Board Reporting Government says annually; I report quarterly See example of Board report
26 QUESTIONS?
27 Contact Information Kirk Ruddell, CHC Compliance Officer Island Hospital th Street Anacortes, WA (
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