When the Government Tries to Change the Rules
The biggest issue we are finding with many of these audits performed retroactively is they are applying guidelines that were not in affect at the time the services were rendered. For practices that are not aware of when and how to use Local Coverage Determinations (LCDs), this leads to significant losses. Most practices that receive a letter from a ZPIC realize the purpose of a ZPIC is to seek out Fraud, Waste, and Abuse, and then make demands for refunds that are overwhelming. Lots of practices simply make the refunds or establish off-sets, which should be the last thing you do.
In a recent case, I came across this very situation whereby the MAC and ZPIC audited a specific type service for "Medical Necessity"; however, they were using an LCD for dates of service prior to the implementation of the policy and as a result determined a 100% error rate that led to a demand for refund of more than $1.9 million from the client. In addition, because of the findings by the ZPIC, more than $1.2 million was withheld from payment to the practice. This is devastating, not only from a repayment standpoint, but from a lack of revenue coming through the door. The sad reality of this situation is that the practice had to shut their doors, and they are still responsible for repayment and are out the monies for services they rendered their patients.
DoctorsManagement was brought into the fold to perform clinical documentation review specifically focusing on the findings of services not being "Medical Necessity" and to validate the extrapolation deployed by the MAC. While we had a very strong case to get the extrapolation thrown out via Frank Cohen's work on Post Audit Extrapolation, we had an equally strong case based on the pure negligence of the ZPIC and MAC to adhere to their own guidelines. Through my long-standing relationship with Robert Liles (Liles/Parker based in Washington, D.C.), I was able to track down specific information to ensure our position was substantiated, thus ensuring our client's ultimate success in not having to repay the demand and affording them now the ability to demand payment from the carrier.
The following are specific guidelines related to LCDs that can be used in defending your practice when the government fails to follow their own rules:
13.7.3 - LCDs That Do Not Require a Comment and Notice Period (Rev. 71, 04-09-04)
• Revised LCD that Liberalizes an Existing LCD - For example, a revised LCD expands the list of covered indications/diagnoses. The revision effective date may be retroactive.
• Revised LCD that Makes a Non-Substantive Correction - For example, typographical or grammatical errors that do not substantially change the LCD. The revision effective date may be retroactive.
• Revised LCD that makes a Clarification - For example, adding information that clarifies the LCD but does not restrict the LCD. The revision effective date may be retroactive.
• Revised LCD that Makes a Non-discretionary Coverage/Payment/Coding Updates - Contractors shall update LCDs to reflect changes in NCDs, coverage provisions in interpretive manuals, payment systems, HCPCS, ICD -9, or other standard coding systems within the timeframes listed in §13.4C. The revision effective date may be retroactive depending on the effective date of the NCD, etc.
• Revised LCD to Make Discretionary Coding Updates That Do Not Restrict – adding revisions that explain a coding issue as long as the revision does not restrict the LCD. The revision effective date may be retroactive.
13.7.4 - LCD Comment and Notice Process (Rev. 71, 04-09-04)
When a new or revised LCD requires comment and notice (See §13.7.2), contractors shall provide a minimum comment period of 45 calendar days on the draft LCD. After the contractor considers all comments and revises the LCD as needed, the contractor shall provide a minimum notice period of 45 calendar days on the final LCD.
Contractors shall solicit comments from the medical community. Carriers solicit comments from the Carrier Advisory Committee (CAC.) DMERCs solicit comments through the DMERC Advisory Process (DAP.) Contractors respond to comments either individually or via a comment/response document (see §22.214.171.124). Where appropriate, the contractor shall incorporate the comments into the final LCD. Contractors notify providers of the LCD effective date. New LCDs may not be implemented retroactively.
Sean M. Weiss, CMCO, CPMA, CPC, CPC-P, CCP-P, ACS-EM is a Partner and Vice President of Compliance with DoctorsManagement, LLC, a full service medical management consultancy and regulatory compliance firm based in Knoxville, TN. Sean has more than 20 years of working on regulatory compliance and health law related issues ensuring proper support and representation for clients across the country. For more information or to get help with your audit and compliance issues, contact Sean at firstname.lastname@example.org or 800.635.4040.