Articles Posted in Medicare

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Hospital lobbying groups are pushing for Congress to pass the Medicare Audit Improvement Act of 2013, which would put a cap on the amount of document requests that Recovery Audit Contractors (RAC) may demand from providers. Specifically, the bill would limit RAC document requests to 2% of hospital claims and a maximum of 500 additional document requests over 45 days.

The legislation was introduced in the House on March 19, 2013 by Representatives Sam Graves (R-MO) and Adam Schiff (D-CA); and was introduced two months later in the Senate by Senators Roy Blunt (R-MO) and Mark Pryor (D-AK). On March 19, 2013, Graves stated in a press release that “[d]octors and nurses should be focused on caring for patients, not trying to comply with the ever-increasing requests for documents.” Graves also stated that small, rural hospitals will benefit from this new legislation the most, since they are often ill-equipped to handle extensive document requests.

The American Hospital Association (AHA) endorsed both bills, and since the new year, has spent $4.3 million thus far in lobbying efforts. In addition, the Federation of American Hospitals and six state hospital associations also joined the AHA in its lobbying efforts. Despite this significant lobbying, neither bill has gained momentum. The same bill was also introduced last year by Graves, but failed to move out of committee. A spokeswoman for the AHA stated that the House bill was not expected to move soon. As a result, lobbying efforts have been placed on increasing the number of co-sponsors of the bill. Last year, only 26 members of Congress co-sponsored the bill, whereas the current legislation has 70 co-sponsors.

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On May 17, 2013, the Department of Health and Human Services (HHS) released an interim final rule, which lowers payments to providers for services furnished to individuals enrolled in the Pre-Existing Condition Insurance Plan (PCIP). The new rule will require providers to accept Medicare rates for services provided to PCIP participants instead of the commercial rates providers have received since the plan’s inception.

The PCIP was established under the Patient Protection and Affordable Care Act (PPACA) which was enacted in March 2010. The plan was intended to be a temporary bridge to provide health insurance to uninsured individuals with pre-existing conditions until 2014. In 2014, most health insurance providers will be required under PPACA to offer coverage to all individuals, regardless of pre-existing conditions. Initially, HHS predicted that up to 400,000 individuals would enroll in PCIP, and Congress provided $5 billion in funds for the program. In fact, only 135,000 individuals have enrolled in the program, but due to the cost of the claims per enrollee being higher than originally projected, most of the $5 billion provided by Congress has been exhausted.

Several changes have already been instituted since the PCIP’s creation in order to reduce costs, including ceasing referral payments to agents and brokers, changing provider networks, offering only a single plan option, increasing the maximum out-of-pocket limit for in-network services, and an increase in coinsurance once the enrollee’s deductible has been met. Furthermore, the federally administered PCIP suspended its acceptance of new enrollment applications on February 15, 2013 until further notice.

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Hospice providers must always obtain written certification that a patient meets Medicare’s hospice coverage criteria. Written certification of terminal illness needs to be obtained no later than 2 days after hospice care is initiated, and must be on file in the hospice patient’s record prior to the submission of a claim to the Medicare contractor. Certification must be made by the medical director of the hospice and, if applicable, the patient’s attending physician. Payment for hospice care will begin the date certification is obtained.

This initial certification satisfies the hospice certification requirement for the first 90-day period of coverage. Additional periods require recertification, which can be obtained 15 days prior to the next benefit period, but no later than 2 days after that period begins.

Per the Medicare Benefit Policy Manual, the written certification must include:

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As mandated by the American Taxpayer Relief Act of 2012, Medicare Part B outpatient therapy providers now face manual medical review of claims at or above a $3700 statutory cap. Due to some confusion in the provider community, the Centers for Medicare and Medicaid Services (CMS) published a Frequently Asked Questions to clarify the new therapy manual medical review process.

In the FAQ, CMS explains that the manual medical review process is triggered when a beneficiary’s services for that year exceed one of two threshold caps dictated in Section 603 of the Act. The cap for Occupational Therapy (OT) services is $3700 per year, per beneficiary. Separately, the combined cap for Physical Therapy (PT) and Speech Language Pathology (SLP) is $3700 per year, per beneficiary. CMS also points out that although physical therapy and speech language pathology services are combined to trigger the cap, the medical review of those claims will be conducted separately.

The FAQ states that the cap and manual medical review process applies to all Part B Outpatient Therapy settings and providers, including private practices, Part B skilled nursing facilities (SNFs), home health agencies (HHAs), outpatient rehabilitation facilities, rehabilitation agencies and hospital outpatient departments.

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On April 24, 2013, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule that increases CMS’ ability prevent fraudulent Medicare providers from enrolling, or remaining enrolled in the Medicare program. The provisions that CMS proposes to implement include:

  • Allowing CMS to deny the enrollment of any provider, supplier or owner affiliated with an entity that has unpaid Medicare debt in order to prevent entities with such debt to avoid repayment by leaving the Medicare program and re-enrolling as a new business.
  • Denying enrollment or revoking a provider or supplier’s Medicare billing privileges if a managing employee has been convicted of certain felony offenses.
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Intermountain Healthcare, the largest health system in Utah, has agreed to pay $25.5 million to resolve claims that it violated the federal Stark law and False Claims Act by engaging in inappropriate financial relationships with referring physicians.

In 2009, Intermountain disclosed to federal officials that the system may have illegally paid bonuses to 37 doctors based on their patient referrals. If true, Intermountain would have been in violation of the Stark law. In addition, Intermountain disclosed that it compensated more than 170 doctors in the absence of written agreements, including via rentals of office space in several cities without written lease agreements. In total 209 physicians were involved in the violations, which spanned over a 10 year period.

Intermountain discovered the violations through its regular review process, and reported them to the government in 2009. Intermountain cites the complexities of the Stark law’s regulations as one cause of its noncompliance. According to Intermountain’s Chief Medical Officer Dr. Wallace, Intermountain should have more closely monitored the situation and although Intermountain’s management realized that penalties could be significant, they chose to self-disclose the issues.

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On April 2, 2013, the Centers for Medicare & Medicaid Services (CMS) held an Open Door Forum to discuss CMS’s Administrator’s Ruling (CMS-1455-R) and Proposed Rule (CMS-1455-P) that provide for significant changes to Medicare’s Part B payment policy when a Part A hospital inpatient claim is denied as not medically necessary because the care was not provided in the appropriate setting.

During this Forum, CMS Representatives advised that hospitals do not have to wait until CMS’s Change Request 8185 implementation date of July 1, 2013 to rebill Part B for Part A inpatient claims denied as not reasonable and necessary pursuant to the interim ruling. CMS Representatives stated that additional instructions for rebilling Part B claims will be released shortly and should be similar to those found in the now defunct Part A to Part B Rebilling Demonstration Program. CMS representatives also confirmed that the interim ruling does not apply to Medicare Advantage.

For those unable to attend the Open Door Forum, a recording of the Forum is available by phone beginning at 5:00 pm on April 2, 2013. To access the recording, dial 1-855-859-2056 and reference conference ID: 78861443. The recording expires after two business days. If you have questions regarding these recent developments or questions about the Medicare appeals process, please contact an experienced health care attorney at Wachler & Associates at 248-544-0888.

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On Tuesday, April 2, 2013 (2:00-3:00 pm EST), the Centers for Medicare & Medicaid Services (CMS) will be holding an Open Door Forum for stakeholders in the healthcare community to call in and discuss the recent changes to the Medicare Part B payment policy in light of recently issued CMS Ruling. The CMS Ruling allows for hospitals to submit a Part B claim when a Part A inpatient claim is denied as not reasonable and necessary.

Tuesday’s Open Door Forum will be conference call only. To participate by phone, dial 1-800-837-1935 and reference conference ID: 78861443. Persons participating by phone do not need to RSVP. TTY Communications Relay Services are available for the Hearing Impaired. For TTY services dial 7-1-1 or 1-800-855-2880. A Relay Communications Assistant will help. Encore is an audio recording of this call that can be accessed by dialing 1-855-859-2056 and entering the Conference ID beginning 2 hours after the call has ended. The recording expires after 2 business days. The number for Encore is 1-855-859-2056; Conference ID: 78861443.

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On March 22, 2013, the Centers for Medicare and Medicaid Services (CMS) released Change Request 8185 to implement CMS Ruling (CMS-1455-R) and provide Medicare contractors with additional guidance for accepting claims rebilled from Part A to Part B. The CMS Ruling, which was released on March 13, 2013, permits hospital providers to rebill under Part B for Part A inpatient claims denied as not reasonable and necessary.

The Change Request reiterates the numerous revisions to the Part B payment policy when a Part A claim is denied as not reasonable and necessary. While the CMS Ruling remains in effect, the Change Requests instructs hospitals to submit Part B inpatient claims with the condition code “W2.” By attaching the “W2” condition code, the hospital is acknowledging that the Part B claim is a duplicate of the Part A claim that was previously denied, no payment shall be made for items or services included on the Part A claim, and the beneficiary will be refunded for any amounts collected from the beneficiary with respect to the Part A claim. Furthermore, by including the “W2” condition code, the hospital attests that no appeals are pending with respect to the previously submitted Part A claim and that any previous appeal of the Part A claim has become final, binding or dismissed, and no further appeal will be filed on the Part A claim. Any Part B inpatient claim submitted under the CMS Ruling that does not include condition code “W2” will be rejected by the contractor. The effective date of the Change Request mirrors that of the CMS Ruling, which took immediate effect on March 13, 2013. However, the implementation date of the Change request is July 1, 2013. Despite the delayed implementation date of the Change Request, hospitals may submit their Part B claims prior to the implementation date, according to CMS.

Wachler & Associates will continue to monitor the developments of CMS’s revised policy on Part B billing following the denial of a Part A inpatient hospital claim. If you have any questions regarding these developments or questions regarding the Medicare appeals process, please contact an experienced health care attorney at Wachler & Associates at 248-544-0888.

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The Office of Medicare Hearings and Appeals (OMHA) has released its instructions and recommended request form for withdrawing a Part A appeal pursuant to the Center for Medicare & Medicaid Services (CMS) Ruling 1455-R. On March 13, 2013, CMS issued Ruling 1455-R, which allows hospitals to bill for certain services under Part B when a Part A inpatient claim was denied as not reasonable and necessary. The Ruling remains in effect until the proposed rule becomes finalized. Under the Ruling, a hospital must withdraw its Part A appeal in order to submit claims for Part B reimbursement.

Wachler & Associates will continue to monitor the developments of CMS’s revised policy on Part B billing following the denial of a Part A inpatient hospital claim. If you have any questions regarding these developments or questions regarding the RAC appeals process, please contact an experienced health care attorney at Wachler & Associates at 248-544-0888.

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