As we approach the holiday season I can tell you that government auditors and those contracted to audit on behalf of our government are going to be in a very giving mood... they will be handing out lots of Post Payment Reviews resulting in Determinations of Overpayments.
Every year around this time I write about the state of our industry and what we have dealt with and what I believe we will be dealing with come the New Year.
I do not have good news here for several reasons. First is that our system remains broken and in grave need of repair. I have written about the problems surrounding Sustainable Growth Rate (SGR) and our current Discount Fee for Service Program known as Really Bad Reimbursement Very Slowly (RBRVS). Providers are working in an environment that is not conducive to success and is unsustainable. This is why Accountable Care Organizations (ACOs) will be so critical. Lots of folks call me every day asking for my take on ACOs and I tell them the same thing every time, "ACOs are nothing more than HMOs in Drag!" However, that is not what this article is about so let's focus on the issue at hand: Audits and the Impact of Medical Necessity.
When it comes to the Recovery Audit Contractors (RACs), they faired pretty well, as well... The Centers for Medicare & Medicaid Services issued its quarterly report for recovery auditor (RAC) activity, and pressure on providers to cough up overpayments is mounting. According to CMS data, RACs recovered $657.2 million in overpayments during the third quarter of fiscal year 2012, up nearly 12 percent from the second quarter of the fiscal year, when $588.4 million was collected, and up more than 60 percent from the first fiscal quarter, when $397.8 million was collected. By contrast, underpayments returned totaled just $44.1 million during the third quarter, down more than 30 percent from the $61.5 million repaid in the prior quarter. However, the data suggests that returned payments are on pace to slightly exceed the $141.9 million returned during 2011.
So what is it that providers can do in an attempt to minimize their risk and potential damages they face from an audit? The first thing is to run a productivity report. Why? Because they do a number of things...
Productivity reports help:
Identify outliers and aberrancies in providers' coding
Identify monies left on the table
Focus attention to areas calling out for attention
Show physicians' vulnerabilities in the practice
Most importantly, they help us find issues before carriers do
Once you have run your reports, use a program such as Frank Cohen's practice analytics, which include Bell Curve and Bench Mark Data to see where the potential vulnerabilities and risks exist for your practice (www.frankcohengroup.com). However, once you have this information, you have to do something with it. Whether you choose to conduct internal or external audits, make sure they are done under the Attorney Client Privilege. Too many times I see practices retain a consultancy to perform audits on behalf of their organization only to put themselves at greater risk because they did not protect the information from discovery. Regardless of how small your practice is, you have to take proper precautions or run the risk of devastating your organization if the information regarding your audit gets into the hands of someone not authorized to disseminate the information. The costs associated with having an attorney of record are minimal and the protections they afford are numerous. Some great firms I work with include: Liles/Parker, DoctorsLegal, Broad and Cassel, and Health Law Partners, and their rates are reasonable for the services they provide.
The audit representation we have been doing the most of in 2013 reveals that more than 85% of the denials related to "Medical Necessity" or lack thereof, are in the majority of cases never well defined by the payors or the agencies tasked with auditing the provider's documentation. I have written more than 1,000 appeal letters in 2013 on behalf of my clients around the country, and as always, I like to share the letters that have had the most success with readers of my column in BC-Advantage.
See Image at the top of this page with link.
As many of you know, there was a major settlement between more than 900,000 physicians and the largest payors in the State of Florida.
In the second district court of appeals, payors were forced to develop a definition for what the term "Medically Necessary" actually meant and here is what they came up with:
"Medically Necessary" or "Medical Necessity" shall mean healthcare services that a Physician, exercising prudent clinical judgment, would provide to a patient for the purpose of evaluating, diagnosing, or treating an illness, injury, disease, or its symptoms, and that are:
A. In accordance with the generally accepted standards of medical practice; B. Clinically appropriate, in terms of type, frequency, extent, site, and duration, and considered effective for the patient's illness, injury, or disease; and C. Not primarily for the convenience of the patient or Physician, or other Physician, and not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient's illness, injury, or disease.
Using what the courts give you is the surefire way to win your arguments because the precedence has been set. When we are talking about "Medical Necessity" as it relates to medical provider documentation during an audit, keep the following in mind: Complications with medical necessity arrive when providers insist that it should be "assumed" that a test "should have been ordered." DO NOT ASSUME OR INTERPRET!!
The provider of the medical care is responsible for connecting the dots. Keep in mind, CMS states the provider should "paint a portrait" which means the components most needed for assessing the appropriate medical necessity and painting an accurate and complete portrait are the History and the Plan of care.
For years I have advocated that levels of service should be driven by the nature of the presenting problem (i.e., Chief Complaint) because this will ensure that a proper history and examination are documented. In the age of electronic medical records, it is very easy to have everything set as a default and then if there are changes to address those. The problem is what if everything in the history and examination are set to a default of yes instead of no; the possibility for over-coding becomes more prevalent, not to mention having the appearance of being cloned.
Medical Decision Making, whether it is for New or Established patients, providers seem to always short themselves in this area and coders try to give more credit than what a provider would be entitled to.
Medical Decision Making is calculated on three levels
(I) the number of diagnosis and/or management options
(II) the amount and complexity of data to review
(III) the overall risk. For years those who consider themselves educators (including me) in the world of E/M code selection try to teach providers to use short cuts when it comes to MDM that might not necessarily and ultimately create potential compliance risks.
Physicians treating patients with very serious illnesses oftentimes believe that they can select the highest level of service in any category based on the high acuity of the patient. The rationale has always been along the lines of something to the effect, "My patient has cancer, so they are really sick!" Based on this thought process, patients are always charged out at the highest levels.
Medical complexity alone is not a "trump card" when selecting an Evaluation and Management service. If the medical decision making is high, according to the Guidelines, the physician must still document the history and exam (for 3 of 3 New Patients or Consultation codes or Admissions) or the history or exam (for 2 of 3 Established Patient and Subsequent Hospital codes) in order to bill a high level visit.
What becomes a major source of frustration for physicians when dealing with "sick" patients is the fact that the 95 and 97 guidelines are written in such a way that often very sick patients do not meet the criteria to select a high level E/M visit. Keep in mind that Medical Decision Making is based on meeting the requirements in two out of three components: The number of diagnoses and management options, the amount and complexity of data to be reviewed, and the overall risk of morbidity and/or mortality.
As an auditor, I am often faced with the following: the patient has one Chronic Stable or one problem that is worsening; there may be two or three data pieces that apply and then high complexity from the table of risk. Unfortunately, when you plug these numbers in to calculate the overall MDM, it does not support the selection of the highest level of E/M service.
The other area where coders and/or providers make a critical mistake is trying to use the shortcut of "Prescription Drug Management." Many times when the auditors who work for me are performing audits of provider documentation, they find the provider selecting a level IV E/M based on Rx. Prescription drug management is not simply reviewing the patient's meds and making the statement in their medical record, "Continue Meds as Planned." Prescription drug management indicates there is active management of the Rx the patient is currently on such as increasing/decreasing the dosage as appropriate, discontinuing a Rx, adding a drug to work in conjunction to another med, or changing from one med to another to try and achieve a more optimal outcome.
The last item I will leave you with is something I talk about in all the lectures I give throughout the course of a year and that is: How to Cover Your Assets!
The way to avoid, mitigate, and/or manage the risk of enforcement action is to implement and maintain an effective compliance program that includes the following:
Appointing a corporate compliance officer a compliance committee;
Developing and communicating a code of conduct;
Implementing written policies and procedures allowing for compliance with federal healthcare requirements;
Providing compliance program training that covers policies and procedures pertaining to anti-kickback laws and legal sanctions under the anti-kickback statute;
Bringing contractual arrangements in compliance with the anti-kickback statute;
Auditing of business relationships and contractual arrangements;
Establishing a confidential disclosure program that develops a mechanism (e.g., toll free hotline) to allow individuals to report or disclose issues, potential offenses, and questions, as well as institute a policy of non-retaliation;
Enforcing standards through disciplinary guidelines for employees of all levels as well as responding to detected offenses and developing corrective actions;
Reviewing the effectiveness and budget for compliance plans; and,
Reporting compliance activities directly to the governing board and top management.
Sean M. Weiss, CPMA, CPC-P, CPC, CCP-P, ACS-EM, is Vice President and Chief Compliance Officer for DoctorsManagement, LLC, a full-scale medical consultancy. Sean has a significant background and heavy concentration in audit and appeal representation for large and small healthcare practices that have been targeted by federal (Medicare), state (Medicaid), and commercial insurance payors. Sean delivers measurable financial results for healthcare facilities and helps physicians deliver quality care without sacrificing government compliance. As a practice management consultant, Sean specializes in the formation of medical practices, merger and acquisitions, divestitures, exit strategy planning, strategic planning (S.W.O.T.), and workflow analysis. Sean is used by clients across the country as a turn-around expert based on his proven track record of success in the industry during the past 18 years. You can contact Sean at firstname.lastname@example.org or 800-635-4040.
Take a look at what the government was able to accomplish in 2012 and you will quickly realize that it doesn't matter what your specialty is or what part of the country you are in.
- 4,100,000,000 = total number of dollars recovered from healthcare fraud. - 2,400,000,000 = number of healthcare dollars recovered under the False Claims Act, including whistleblower actions. - 6,600,000,000 = number of dollars collected under False Claims Act for healthcare fraud since 2009. - 1,430 = number of new indictments for healthcare crimes in 2012. - 743 = number of defendants convicted of healthcare crimes in 2012. - 21 = number of criminal convictions involving the pharmaceutical industry. - 1,300,000,000 = number of dollars recovered for pharmaceutical fraud. - 47 = average number of months in prison for healthcare fraud convicts in 2012. - 350,000,000 = the number of additional dollars allocated to Healthcare Fraud prevention in 2012. - 9 = number of cities with Medicare Fraud Strike Force Teams