Audits: Know your risks and Get prepared

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1 Objectives Audits: Know your risks and Get prepared 1. Establish familiarity with various audit contractors and identify variances in their audit processes 2. Understand documentation guidelines and requirements for all parties supplier, PT and physician 3. Discover tips/tools that will help you maneuver through an audit February 28, 2015 WAYNE H. VAN HALEM Kelly Grahovac President and The van Halem Group, Kay Koch LLC The van 934 Halem Glenwood Group, Ave LLC SE 934 Glenwood Suite Ave. 200SE Atlanta, GA Suite (404) Atlanta, , GA ext (404) Types of Audits Medicare Recovery Audit Contractor ZPICs SMRC CERT MAC Medicaid Recovery Audit Contractor MICs Office of the Inspector General (OIG) Private Insurance Carriers Recovery Audit Contractors (RACs) Identifying claims that contain overpayments and underpayments Review claims on a post-payment basis Reviews are a direct result of data analysis, not random selection of claims RACs look back 3 years from the date the claim was paid Widespread probes are approved by CMS first and posted to the RAC web-site beforehand Paid a contingency fee for improper payments recovered Recovery Audit Contractors (RACs) Apply same Medicare policies as DME MACs NCDs, LCDs and CMS Manuals Automated Reviews System edits no human involvement Semi-Automated Reviews Review data and potential human review of the clinical records Complex Reviews Human review of the clinical record RACs must employ RNs, therapists, coders, and MD RAC Program Expansion Four A/B RAC Jurisdictions Implementation of a National DMEPOS and Home Health RAC Program DMEPOS and Home Health activities removed from workload of current jurisdictional RACs Goal: To recoup overpayments and pay underpayments RACs encouraged to extrapolate Medicaid RACs encouraged to increase audit activity 1

2 ZPICs/MICs/UPICs ZPICs/MICs/UPICs Integrity contractors function to: Identify potentially fraudulent Medicare providers Refer resulting cases to law enforcement Pursue administrative actions to reduce, deter, and prevent fraud, waste, and abuse in the Medicare and Medicaid programs Encouraged to extrapolate Penalties include revocation of your provider/supplier number, civil monetary penalties, imprisonment Implementation of the UPIC initiative to begin in 2015 Combines the audit and investigation work currently conducted by the ZPICs (and their responsibilities) with the Audit Medicaid Integrity Contractors (Audit MICs) to form the UPIC Contracts with ZPICs/PSCs and MICs will end as the UPIC is implemented in specific geographic regions Implementation of the UPICs will be over a multi-year period in order to allow current contractors to transition out Goal: Streamline audit structure Managed Care/Medicare Advantage/HMO Supplemental Medical Review Contractor Increased pressure on Medicare Advantage/HMO plans to conduct program integrity functions Applying policies consistently as Medicare Increased prepayment review and extrapolated overpayments Must be treated the same as Medicare Strategic Health Solutions performs a large volume of Medicare Part A, Part B, and Durable Medical Equipment reimbursement claims nationally. Strategic will focus on lowering improper payments in Medicare Fee-For-Service programs and increasing efficiencies in medical review functions. Projects include issues identified by the OIG, CERT and CMS internal data analysis Focus on national claims data analysis versus MAC jurisdiction data Supplemental Medical Review Contractor CERT Completed Projects Power Mobility Devices Medicare Part B Outpatient Rehabilitation Therapy Services Comprehensive Error Rate Testing (CERT)calculates the Medicare Fee-for-Service (FFS) improper payment rate Random sample of claims to determine if they were paid properly under Medicare coverage, coding, and billing rules Effects both the provider/supplier community and the MAC that processed the claim Can result in an increased RAC and MAC reviews Important to respond!!! 2

3 MAC MAC Medical Review functions to prevent improper payments Pre-payment review System edits in place to generate Additional Documentation Request (ADR) MR reviews documentation and makes determination prior to claim processing Post-payment review Occurs after the claim has been paid Results in either no change to the initial determination or a revised determination indicating that an overpayment or underpayment has occurred Can be provider specific, service specific Power Mobility Devices Lump-sum purchase versus rental OIG will determine whether potential savings can be achieved by Medicare if certain power mobility devices (PMDs) are rented over a 13-month period rather than acquired through a lump-sum purchase. Power Mobility Devices Supplier compliance with payment requirements OIG will review Medicare Part B payments for suppliers of PMDs to determine whether such payments were in accordance with Medicare requirements. OIG will focus particularly on whether Medicare payments for PMD claims submitted by medical equipment suppliers are medically necessary and whether Medicare payments for PMD claims submitted by medical equipment suppliers are supported in accordance with requirements at 42 CFR Power Mobility Devices Add-on payment for face-to-face examination OIG will review payments for PMDs to determine whether the F2F requirements were met. Medicare requires that the treating physician, when prescribing a PMD, conduct a F2F to determine the medical necessity and write a prescription To receive compensation, the prescribing physician can bill for an E/M service and has the option of billing for an add-on payment for the sole purpose of documenting the need for the PMD. Prior OIG work found that when the prescribing physician did not bill the code for the add-on payment in addition to the evaluation and management (E/M) code, the resulting PMD claim was likely to be unallowable. Physical Therapists High use outpatient physical therapy services OIG will review outpatient physical therapy services provided by independent therapists to determine whether they were in compliance with Medicare reimbursement regulations. Prior OIG work found that claims for therapy services provided by independent physical therapists were not reasonable or were not properly documented or that the therapy services were not medically necessary. OIG will focus is on independent therapists who have a high utilization rate for outpatient physical therapy services Improper use of KX Modifier WHAT DOES THE KX MODIFIER MEAN? 3

4 Improper use of KX Modifier Suppliers/providers must add a KX modifier to the [Procedure Code] only if all of the coverage criteria in the Indications and Limitations of Coverage and or Medical Necessity section of this policy have been met and evidence of such is retained in the supplier s files and available to the DME MAC upon request. Suppliers must add a KX modifier to [Procedure Code] only if all of the criteria in the Indications and Limitations of Coverage and/or Medical Necessity section of this policy have been met. If the requirements for the KX modifier are not met, the KX modifier must not be used. Improper use of KX Modifier In the following policies, the instructions for use of the KX modifier clearly specify that the supplier must have the documentation in their filesbefore they may submit a claim line with the modifier. Manual Wheelchair Bases Power Mobility Devices Wheelchair Options and Accessories Wheelchair Seating Physical Medicine and Rehabilitation Service, Physical Therapy and Occupational Therapy 20 Improper use of KX Modifier Common Documentation Errors Adding the KX modifier without ascertaining that all the requirements specified in the policy have been met could be viewed as filing a false claim and potential abuse of the Medicare Program Suppliers must review the Documentation Requirements section of each LCD to fully understand the criteria that must be met for the proper use of the KX modifier Use the CGS KX Modifier Tool ope12183.html 21 Common Documentation Errors Illegible medical records Get them transcribed Illegible physician signatures Signature attestations Signature logs Stamped signatures Invalid electronic signatures Missing patient identification on multiple pages of medical or supplier records without indication of page numbers Common Documentation Errors Invalid Dispensing Order Invalid Detailed Written Orders Remove all information not required A prescription is not considered as part of the medical record Remove medical necessity information 4

5 Common Documentation Errors Medicare Clinical Documentation OT/PT Eval Insufficient physician documentation Documentation of on-going need Documentation of on-going use Submitting too many medical records Highlighting medical records Altering medical records Documentation makes no reference to equipment Group 2 single and multiple power All Group 3 and all Group 5 Must support medical need and coverage criteria Justify based, and each option and accessory Use objective exams or tests when possible Ordering practitioner must agree and sign eval Non financial attestation Clinical Documentation Medicare Documentation Reviewed Must ID need for the equipment requested Combines diagnosis, function, mobility status, and goals Justification of base requested as well as each option or accessory What else was considered and why a least costly alternative cannot be used. Address existing equipment, if appropriate Why is replacement vs. repairs or modifications needed Focus on Medicare requirements Followed by many state Medicaid programs Insurance and other funders follow Medicare Documentation LCMP Medicare Documentation Own NPI number Medical Exam and Written Order = Same person Progress notes ID mobility difficulty Physical limitation matches features on equipment Why a least costly alternative cannot be considered Consequences if this requested equipment is not provided 5

6 Medicare Documentation - Supplier Other Healthcare Professionals Ultimately responsible for collecting Medical exam (F2F) and written order Progress notes Detailed product description Delivery ticket Home Assessment OT/PT eval when needed ATP eval Rent to purchase documentation Physical Therapists and Physiatrists Ordering Physician writes order for functional assessment PT or MD conducts evaluation Report of evaluation sent to ordering physician Ordering physician reviews and concurs with evaluation Win-Win-Win You get better functional assessment PT or MD gets to bill for functional assessment Ordering MD is off-the-hook. Delivery Ticket Tips Tips Must be kept for 7 years Patient Name Quantity of item delivered Detailed product description of items delivered Brand name Serial number Review audit contractor websites periodically to determine if the equipment you provide is under review RAC: Approved Issues SHS: Current Projects DME MAC Revisit LCDs/NCDs to be sure you understand and are meeting coverage criteria and guidelines Subscribe to your DME MAC s listserv to keep informed of updates and changes Tips Tips Implement processes to get claims paid up front Audit ready files Prior approval process Review frequently audited items to be sure coverage/documentation criteria is met and have someone approve each delivery Try to get as much documentation up front or as quickly after providing the service as possible Educate your physicians on the criteria for coverage Work with Office Managers and explain the need for the documentation to remain compliant Could result in additional scrutiny on the physician practice Use product specific cover letters when requesting DWO and office notes 6

7 Tips Questions??? Track audit issues Track audit and appeal responses Consider use of reopenings Contact legislators and get patients involved The van Halem Group, LLC 934 Glenwood Ave SE, Suite 200 Atlanta, GA (office) (fax) Kelly S. Grahovac, Sr. Consultant Kay Koch, OTR/L ATP Rehab Team Supervisor 7