Connie Leonard, Director of CMS Recovery Audit Operations, recently encouraged providers to contact CMS if they see this kind of denial. She also claims that RACs don’t intentionally deny procedures on the CMS Inpatient-only list. One wonders, though, did anyone really ask that question? And does it really matter, since both RACs and providers involved wind up spending money on chasing “phantom” errors?
Regardless, providers continue to be frustrated with the whole process, especially since CMS never seems to accept any judgments overturning denials as precedent for other cases, which has been painfully evident ever since the Feb. 1, 2010 Medicare Appeals Council decision against CMS, supporting O’Connor Hospital, reversing a denial by one of the Demonstration Project RACs. While that case was a completely different subject, on allowing a provider to bill for “observation and underlying care” when the claim was denied as an inpatient claim, it nevertheless shows the CMS proclivity to consider every such case as an island, untethered to any other cases, regardless of similar or even duplicated circumstances.
Turmoil in the RAC world… and this is new? Not hardly. But recently, many providers have been loudly complaining that RACs are inappropriately issuing medical necessity denials for claims with procedures that exist on the CMS inpatient-only list. Some cases have borne out this assertion by providers. However, there are other cases where the denials are not inappropriate, despite the seeming incongruity of the situation.
How can that be true? Several factors are involved, not the least of which concerns (a) the physician’s documentation to support the procedure in the first place, and (b) the CMS Inpatient-only list itself, for the year in question. There is also an inherent, what shall we call it… lunacy… involved in the whole payment system, which we shall mention last, below.
And, we should mention here, you should try to forget about the idea that RACs are purposely pursuing such denials. This is a nightmare for them, as well. They would just as soon avoid these reviews and denials, because they wind up just costing them money, for which they are not reimbursed by CMS.
Let’s first look at the two factors already mentioned.
The majority of complex denials issued by the RAC to date are for short-stay medical necessity, typically where the care was, in the opinion of the RAC, provided int the wrong setting. Many times, this type of denial can be attributed to a lack of documentation in support of an inpatient admission. While providers have been very successful at appealing these type of denials at the Administrative Law Judge (ALJ) level, the third stage of the appeal process, there are recent reports that this may become increasingly more difficult for providers to win, as ALJs have recently been taking a “more stringent” view of these type of cases. [see Health Business Daily http://aishealth.com/archive/rmc043012-01 story, May 14, 2012].
As we all know, “Not Documented = Not Done” is now and forever shall be the mantra of coders, billers and auditors. If the documentation does not support the codes, then it doesn’t matter whether the code was on the CMS inpatient-only list.
The CMS Inpatient-Only List
For whatever reasons, the list on Inpatient-only Procedures changes, year to year, as per the list makers at CMS. The key point here is that just because a code is on the list one year, does NOT mean it will be on the list THIS year. That is, you have to match the year of the claim with the year of the list. We are aware of cases where the codes involved in a denial were on the list the year before the claim was filed, but were not on the list for the year the claim was filed.
Simple, right? Yes.
CPT + ICD + DRG = Nightmares
This is where we get to the Lunacy part. The CMS Inpatient-only List is a list of procedure codes. Specifically, here is the file title, which appears inside the Excel file, which is available from CMS: Addendum E.-Final HCPCS Codes That Are Paid Only as Inpatient Procedures for CY 2012.
Wait… aren’t we talking about Inpatient billing? Yes, hospitals are billing for Inpatient procedures, which would normally suggest that they would be billing with ICD-9 procedure codes, but NOT HCPCS Codes.
And there’s the rub… The HCPCS Codes do not appear on the inpatient claims. Oops!
Oops is right. Those codes don’t appear on the claim, and there does not appear to be any current way to identify the claim as including a procedure that appears on the CMS Inpatient-only list.
Whence, the problem. And to make matters worse, there are no readily available crosswalks for these HCPCS codes to ICD-9 codes.
Until CMS determines some way to identify such situations on an inpatient claim, there will continue to be confusion, turmoil and consternation. And denials.
What Providers Should Do
We would recommend that these claims be flagged by providers somehow, before the denials occur. The RACs have already shown that they are quite happy to rescind denials for claims where the procedure was appropriately billed. But you need to make sure you have your ducks in a row… for now, you will have to manually check the Inpatient-only Lists for whatever year is in question, AND you have to make sure the documentation is supporting and appropriately descriptive and specific. If you have that, you will get it overturned, or rescinded or you can win on appeal.
Unfortunately, that’s likely the best you can do, for now.
Four Years of Inpatient-Only Lists
By the way, we thought people might want these, so here they are for download…
We’ve teamed up to bring you an even better experience at…
The idea is simple…
Because you are an attendee for the RAC Summit material, we’re giving you a free download of our updated RAC Approved Issues Database, updated to June 1, 2012.
If you get someone else to attend now, register and pay as of today, then you get at least 2 more great prizes!
1. You get $200 refunded to your Registration — whatever card you used to pay for your attendance.
2. You get a free annual membership to Appeal Academy, which includes access to high-end, advanced courses on compliance, coding, billing, RACs and other topics, including at least 18 CEUs. (That membership is sold elsewhere for $250/year, and you can transfer this membership to someone else, if need be…)
3. If you happen to be an onsite attendee, you ALSO get a 2nd “game card” which will give you a 2nd chance to win the iPad2 being given away at the end of the conference.
Sound good? And all you have to do is register here to be entered!
So what are you waiting for? Get to it!
Currently, the RAC Shadow Approved Issues Lists are down, as a result of changes made by the RACs to their websites. We are about to post new lists, however, as our scraper tools are now working. Be watching for NEW emails coming out in the next week with new links and offers of new tools, to give you even more ability to search and research RAC Audit issues.
If you register for the site or our newsletters, you will be automatically informed by email as soon as the lists and tools become available.
Greetings, Agents! This is the site of the New and Improved RAC Shadow Agency…
We have made every attempt to simply the organization and navigation of the site, to make it easy to find the most used tools and information that we have seen used by Agents on the original RAC Shadow site. Please give us your feedback, as we have many changes still in mind, and will endeavor to meet your expectations and suggestions.
Our RAC Sniper Tools (now v4.0) are now able to collect information from the RAC sites as well as other sites, such as the CMS, CERT and PEPPER sites. Watch for news alerts coming to you soon about those tools and information.
At the moment, you can view the data for both the RAW scrapes from the RAC Sites, and for a limited time, you can preview our version of the RAC New Issues Database for free.
The RAW data is found under the Tools->Free Search Tool menu item. Our version of that data, which is analyzed and then edited to be more useful to providers, can be seen under the Tools->All Issues By Region menu item. This version of the data will be freely accessible here through June 1, 2012. After that date, the data will be available by subscription, and will also be available for download, for an additional charge.
Finally, we want to let you know that the RAC Sniper Tools themselves (the software bots that scrape the RAC sites) will be available for direct license, later this summer. That is, you can get the same tools that we use, and install them on your own workstation, and create your own database. Stay tuned!
Due to the growing popularity of The RAC Shadow and recent changes to the RAC public websites, The RAC Shadow Agency has had to make some significant changes in both our tools and our Agent Access Portal (this site).
All registrations are currently held for manual activation — once a registration is submitted, we will activate it usually within a few hours or within 24 hours. This is necessary because of the growing number of false email addresses submitted by spammers and other sundry ne’er-do-wells who seem to have targeted our site, as of late.
If you register and do not see your account activated within 24 hours, please contact us at firstname.lastname@example.org and we will respond quickly.
Meanwhile, watch your emails and this page for updates on the new tools and changes to be released on Tuesday, February 14, 2012 — our Valentine’s Day gift to all our Shadow Agents!
The RAC Shadow Agency
CMS Special Open Door Forum: Medicare Fee-For-Service Recovery Auditor Prepayment Review Demonstration
We recorded the second CMS Special Open Door Forum for the Recovery Audit Prepayment Review Demonstration, conducted by CMS on December 21, 2011. The project will allow Medicare Recovery Auditors (RACs) to review claims before they are paid to ensure that the provider complied with all Medicare payment rules. The RACs will conduct prepayment reviews on certain types of claims that historically result in high rates of improper payments. These reviews will focus on seven states with high populations of fraud- and error-prone providers (FL, CA, MI, TX, NY, LA, IL) and four states with high claims volumes of short inpatient hospital stays (PA, OH, NC, MO) for a total of 11 states. This demonstration will also help lower the error rate by preventing improper payments rather than the traditional “pay and chase” methods of looking for improper payments after they occur. Contact: RAC@cms.hhs.gov
Register or Login for access to the recording. A transcript will only be available on request, for a small charge.
CMS Open Door Forum #2: Part A to Part B Rebilling Demonstration – Recordings & Transcripts Available Here
We recorded the second CMS Special Open Door Forum for the Part A to Part B Rebilling Demonstration, conducted by CMS on December 8, 2011. The project will allow hospitals to rebill for 90 percent of the Part B payment when a Medicare contractor denies a Part A inpatient short stay claim as not reasonable and necessary due to the hospital billing for the wrong setting. Contact: ABRebillingDemo@cms.hhs.gov
Register or Login for access to the recording. A transcript will also be available, late on Friday, December 9. (We’re geeks. Maybe CMS should use us for this stuff?)
Find the recording and transcript for the first Open Door Forum by CMS on this subject, HERE.
On November 30, 2011, the United States Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that eligible providers that satisfy the Medicare and Medicaid EHR Incentives Program Stage 1 Meaningful Use criteria in 2011 may wait until 2014 to comply with CMS‘s Stage 2 criteria.
We recorded the CMS Special Open Door Forum for the Part A to Part B Rebilling Demonstration. The project will allow hospitals to rebill for 90 percent of the Part B payment when a Medicare contractor denies a Part A inpatient short stay claim as not reasonable and necessary due to the hospital billing for the wrong setting. Contact: ABRebillingDemo@cms.hhs.gov
Register or Login for access to the recording. A transcript will also be available, within 24 hours. (Natch. We’re geeks.)
RAC Shadow Agency has serious concerns and questions about the new CMS AB Rebill Demonstration Project. We wanted to get some thoughts and questions out BEFORE the call…
The audio MP3 File here is a recording of a couple of calls we made with Day Egusquiza of AR Systems, Sharon Easterling of Carolinas Healthcare Organization, and includes some thoughts from Paula Digby of eduTrax.
Rebill Project Audio – Click or Copy the link below into a new browser window for playback…
Please LISTEN TO THE FILE — it’s about 18 min long, download it, send it to whomever you like, you have our permission to distribute/use as you wish.
Here is an abbreviated version of questions that we have put together.
Please ASK THESE QUESTIONS OR SOMETHING LIKE THEM on the calls, if you get the chance, or by sending them into CMS.
Below is a short list. You should listen to the MP3 File to better understand some of them and why we are asking.
Why does CMS not consider the O’Connor decision a precedent for these type of cases?
If there is no appeal process for the claims denied under this program, is there any Discussion or Rebuttal Period?
Who decides what is a “medically unnecessary” and is there any chance to discuss it or submit additional documentation or simply point out documentation that could affect such a decision?
What Bill type is a provider supposed to use?
Will the “code” mentioned in the presentation suffice to “convert” the claim?
What about documentation that was only “good enough” for inpatient, such as drug administration? How can that be handled?
Will these claims denied under this program also allow reach-thru? That is, what happens to downstream or physician claims associated with the denied inpatient claim? Do they also get an ability to rebill, or what happens?
How does the timely filing limit affect these claims? What will the timely filing limit be for these “rebills?”
Does the timely filing “clock” restart when the denial is made? That is, if the date on the original claim puts us “outside” the timely filing limits?
Is the provider allowed to apply a copayment balance owed to a beneficiary against another encounter’s copayment balance due?
Can a provider decide to opt out of the program once they volunteer? If so, what is the process or restrictions?
Will you provide some kind of forum to ask and answer questions BEFORE the program begins?
What is the criteria that CMS will use to decide to remove a provider from the program, as described in the presentation, where fraud/abuse is suspected?
After the call, we will be posting a recording of the call by Friday, December 2. We might make a transcript available for a small fee.
Watch for the postings.