A few months ago I sent a public records request to the Division of Medical Assistance (DMA). I eventually received the information…today.
I wanted to know how many providers had been put on prepayment review. A provider can be placed on prepayment review pursuant to N.C. Gen. Stat. 108C-7. I have blogged about 108C-7 before. It is a Draconian law. See my blog: “You Have Been Placed on Prepayment Review, Now What?”
108C-7 states that a provider cannot appeal being placed on prepayment review. Yet while on prepayment review, the Carolinas Center for Medical Excellence (CCME) determines which claims submitted by you are “clean.” For the period that you are on prepayment review, you will not be paid for claims that are not “clean.” Oh, and CCME can subjectively determine whether you should be paid and you have zero recourse for which to challenge CCME’s subjective determination. See my blog: “NC Medicaid:CCME’s Comedy of Errors of Prepayment Review.”
The only relief for providers in 108C-7 is that “In no instance shall prepayment claims review continue longer than 12 months.”
The law specifically states that you cannot be forced to endure prepayment review for over 12 months.
One of the documents that DMA sent me is a chart with every single provider that had been placed on prepayment review. The chart includes the number of months that the provider was on prepayment review. But, remember, 12 months is the max per law.
See the highlighted numbers? 16. 11. 34. 34. 7. Three of the numbers are above 12….which means, three of the 6 on the first page violate state statute.
How many prepayment reviews were unlawfully conducted? (As in, DMA/CCME kept the provider on prepayment review beyond 12 months)?
75. Seventy-five prepayment reviews violated 108C-7. 75 out of approximately 125. (I started counting each one, but my eyes kept going cross-eyed…Look how small the print is!)
Reagrdless…well over half the prepayment reviews violates 108C-7!!! That same Draconian law that DHHS holds each provider to…DHHS (via CCME) is ignoring the plain language of the statute.
One poor provider was on prepayment review 46 months!!!! Another 45! A bunch of the providers were in the 30s!
Why didn’t these providers protest at being on prepayment review for so long? I have a couple of theories: (1) They are out of business; (2) They had no lawyer and had no idea that there was a 12 month limit.
Well, readers, now you know…There is a 12 month limit to prepayment review!! But DHHS/DMA/CCME is not following it. Seriously!!
During this holiday time of giving and family time, I would like to take a moment to say, “Thank you!” to all you health care providers who accept Medicaid.
Thank you!!
It’s not easy to be a Medicaid provider, especially in our current Medicaid landscape. It’s also not immensely profitable. But, there are still approximately 70,000 of you in NC continue to accept and serve Medicaid recipients despite the rocky terrain. And, I, for one, would like to say, “Thank you!”
More so than private insurances, and, I daresay even more than Medicare, accepting Medicaid patients places a large burden on the Medicaid providers. At least in Medicare, the reimbursement rates are higher. Because the number one complaint I hear from health care providers is the Medicaid reimbursement rates SUCK! And they do!
For example, for CDT code D0120, which is a periodic oral exam, a dentist is reimbursed $25.27. For a physician, an office visit emergency care is reimbursed at $18.20. Home health care medical supplies are also reimbursed at a law rate. For 10 mL of sterile water Medicaid reimburses 41 cents. (I didn’t realize that my computer does not have a symbols for “cents.”) An intermittent urinary catheter; straight tip, with or without coating (Teflon, silicone, silicone elastomer, or hydrophilic, etc.) is reimbursed at $1.59.
My point is that, no matter what type of provider you are, a dentist, a physician, and a home health provider, if you accept Medicaid, you also have overhead costs (rent, electricity, perhaps cable), plus staff costs (salaries, taxes), plus other incidentals (office furniture, decoration, supplies) and you hope to make a profit. Therefore, many health care providers simply do not accept Medicaid because the reimbursement rates are so much higher if they only accept private insurance, or even Medicare.
Not to mention the federal and state regulations that you have to follow if you choose to accept Medicaid….Oh, and, by the way, if you fail to follow any regulation, you may be subject to an audit.
Oh, and, by the way, even if you DO follow all applicable rules and regulations, you are still subject to audits.
Instead of sending a Tentative Notice of Overpayment (TNO), a notice of an upcoming audit, some crappy reimbursements during this holiday season, I would like to send a big “Thank You!” to all the health care providers in NC that accept Medicaid.
Hey, everybody!! Anyone miss me? I feel like I haven’t blogged in forever. And, the thing is, I am so excited about this blog!! I actually found out about the CMS letter last week, but have had zero time to blog (had a very intense, two-day hearing). So I apologize if you have already seen the CMS letter…but, for others, read on…
I have to say…I love it when I am right!
In North Carolina, we set up managed care organizations (MCOs) to manage behavioral health care for Medicaid. For the past year, I have been blogging that the MCOs’ payment arrangement with the Department of Health and Human Services (DHHS) is fishy. These MCOs are pre-paid. Their profit hinges on spending less. In order to spend less, the MCOs deny medically necessary services (usually the most expensive) and terminate quality health care providers’ Medicaid contracts. I mean, come on, why authorize more services and contract with more providers if doing so would directly decrease your profit?
Apparently, I am not the only person concerned with how the MCOs are compensated.
On October 24, 2013, the Centers for Medicare and Medicaid Services (CMS), which is the federal agency charged with overseeing Medicare and Medicaid (as in, if CMS says jump and you accept federal money for Medicaid, you jump) sent correspondence to our Acting Medicaid Director Sandy Terrell. (Remember Carol Steckel abruptly left our Director position, leaving Terrell holding the conch…I bet that conch is getting mighty heavy!).
CMS’ correspondence states that, during its review of NC’s contracts between DHHS and the LME/MCOs, CMS determined an issue. Specifically, CMS determined that the arrangement between DHHS and the MCOs may be classified as “subgrants or intergovernmental agreements that are subject to the cost principles set forth in the Office of Management and Budget (OMB) Circular A-87 (A-87).”
So what? Who cares if the arrangement between the MCOs and DHHS is classified as a subgrant subject to A-87? Blah…blah….blah….right?
Wrong!
If the MCOs are subject to A-87, then the use of Medicaid funds is limitedto “allowable costs.” Why is that important? Allowable costs do NOT include….
If you take away the ability for the MCOs to profit off of our taxpayers’ Medicaid money, then you take away the monetary incentive for the MCOs to deny medically necessary services and to terminate provider contracts.
Know what else you take away? The desire to be an MCO.
So what happens now? Just because CMS wrote a letter to NC saying it does not agree with our payment arrangement with the MCOs, does that mean that we have to immediately stop and desist from paying the MCOs? No.
In fact, CMS also states that it “recognize[s] that changing a long-standing delivery system will take time and potentially state legislation. We know the process begins with a frank discussion of these issues…”
CMS did, however, provide a couple of choices for us (if, in fact, A-87 does apply):
1. Openly procuring behavioral health services and making the counties compete on the same basis as with any other commercial entity; or
2. Comply with A-87 by changing the payment methodology and reimburse only for the cost of services actually rendered plus administration costs.
I am actually doing the Snoopy dance as you read this.
Herein lies the problem…How many times in the last 10 years, has NC changed the mental health care system? How many mess-ups? How many Medicaid recipients have not received medically necessary mental health care service because of NC changing the mental health system over and over?
So what happens now?
On a sidenote, I love North Carolina’s response to CMS. Over a month after receipt of the CMS letter, on November 27, 2013, DHHS finally responds with a short, 2 paragraph letter signed by Sandy Terrell. “As you might expect, North Carolina was surprised to receive the letter outlining [CMS’] concerns regarding the cost principles set forth in the Office of Management and Budget (OMB) Circular A-87…”
NC was surprised???
Not I.
I am reminded of Andrew Lloyd Webber’s “Evita,” when Eva Peron follows her lover to Buenos Aires only to discover he is married with children. She has all her belongings in a suitcase, turns from her ex-lover’s home and sings, “Another Suitcase in Another Hall.”
So what happens now
(Another suitcase in another hall)
So what happens now
(Take your picture off another wall)
Where am I going to
(You’ll get by you always have before)
Where am I going to
Just like Eva Peron, NC had full faith the MCOs, enacted them statewide, and, then, not even a year into the statewide MCO progam…BOOM! The MCOs are married with kids.
So what DOEShappen now?
In the short-term, probably nothing. And, there is a chance that nothing happens in the long-term. In NC’s response, Ms. Terrell wrote that “[w]e believe we have information to share with CMS that should alleviate those concerns…”
Most likely, Ms. Terrell will explain to CMS how the wonderful MCOs are completely objective and how they save NC millions in Medicaid money…We will see whether CMS drinks DHHS’ Kool-Aid…
If, on the other hand, CMS demands change, in the long-term, there will be great change.
If we go with Door #1…”Openly procuring behavioral health services and making the counties compete on the same basis as with any other commercial entity,” what will that look like?
I believe CMS is envisioning not allowing the MCOs to monopolize their catchment areas.
Here are the MCOs “jurisdictions” today:
And more mergers are currently being contemplated. But, for now, if you live in Mecklenburg county and need behavioral health care services you must go through MeckLINK. Raleigh? Alliance is your MCO. You have no choice of MCOs and must use a provider within the MCO’s catchment area.
The way I understand CMS’ proposal, if you live in Mecklenburg county, you would not have to receive services from or (if you are a provider) have a contract with MeckLINK. You could, but there would other options as well. Door #1 is what I call, “Busting up the Baby Bells!”
What about Door #2? “Comply with A-87 by changing the payment methodology and reimburse only for the cost of services actually rendered plus administration costs.”
For this option, I believe, that the MCOs could remain where they are, but contract to be paid some, sort of, “cost-plus.” No more…if you do not spend it, it is your profit. Theoretically if the money were not spent, it would be returned to DHHS, or, somehow, kept for additional services. Bye, bye, monetary incentive to deny services and terminate providers!
Door #2 is what I call, “Busting up the Ponzi scheme!”
No matter which door NC chooses, it has to be better than our current situation with the MCOs.
Ok, I stopped doing the Snoopy dance.
Because, in reality, there will be change. We do not know what the changes will be. And, dag on it, change is scary, especially we are talking about changes to mental health services for Medicaid recipients.
As Eva Peron says, “Where [are we] going to?”
Then, if you have seen the motion picture “Evita,” Antonio Banderes sings, “Don’t ask anymore…”
Without question, men and women see things differently. We process things differently. Which, of course, is why John Gray, Ph.D’s book “Men Are From Mars, Women Are From Venus” was such a huge success. Men and women are so different that we can see (or read) the same thing and have two completely different ideas about what happened.
An example of the difference in male and female perception is how men and women view their bodies. Men, generally, think of themselves as much better looking than they acually are in reality…
Whereas women, generally, think they are fatter or uglier than they are…
Then here comes DHHS…
Yesterday (Tuesday) at the Joint Legislative Oversight Committee on Health and Human Services meeting, Chief Information Officer Joe Cooper said the state staffers overseeing the NCTracks system should be “congratulated on seeing this project through a successful launch.”
Congratulated??
For seeing NCTracks through a SUCCESSFULlaunch??
Men may be from Mars. Women may be from Venus. But DHHS is from Dune and just as fictional.
“If we do not learn from history, we are doomed to repeat it.” George Santayana.
In William Shakespeare’s “Julius Caesar,” Caesar is warned to “Beware the Ides of March.” See Act 1, Scene 2. The “ides” of March is the fifteenth. Back when Caesar established the Julian calendar, he also instituted the “ides” of a month. Months have different “ides.” The ides of January, for example, is the thirteenth; the ides of March, May, July and October is the fifteenth.
Caesar:
Who is it in the press that calls on me?
I hear a tongue shriller than all the music
Cry “Caesar!” Speak, Caesar is turn’d to hear.
Soothsayer:
Beware the ides of March.
Caesar:
What man is that?
Brutus:
A soothsayer bids you beware the ides of March
Not really sure what the point of the “ides” was, but, regardless, in 44 B.C., March 15th was the “ides” of March.
When Caesar was warned to “Beware the Ides of March,” Caesar would have known that the soothsayer was warning him about March 15th…a date certain.
Similarly, the Department of Health and Human Services (DHHS) was warned that NCTracks was not ready for its July 1, 2013, “go live”date. Who was the soothsayer? The Office of State Auditor…Beth Wood.
In May 2013, prior to NCTracks going live, State Auditor Beth Wood published a Performance Audit that found hundreds of untested issues. The audit warned DHHS that NCTracks was not ready to go live. The May 2013 Performance Audit may as well have said, “DHHS, beware the first of July!”
Late in the day on March 15, 44 B.C., Caesar walked to the Theatre of Pompey, where he would be assassinated by more than 60 conspirators led by Brutus, his close ally…”Et tu, Brutus?” (Meaning…how could you, my closest friend, conspire against me?)
On his way to the theatre, Caesar sees the same soothsayer who had warned him of the ides of March. Caesar joked, “The ides of March have come,” meaning to say that the prophecy had not been fulfilled, to which the seer replied “Aye, Caesar; but not gone.” See Plutarch’s “Parallel Lives.”
I can only imagine the chill that ran down Caesar’s back when the soothsayer warned that the day was not over yet.
Yet, Caesar still walked to the theatre…despite the warning….
Despite the warnings in the May 2013, Performance Audit, DHHS still went live on July 1, 2013.
Since going live, NCTracks has run into a large number of system defects. Providers in NC have been in uproar. From not getting paid, to getting paid the wrong amount, to Medicaid/Medicare crossover issues, to taxonomy issues…the failures and defects of NCTracks have been felt by all Medicaid providers, despite the speciality.
About a month ago, NC General Assembly began demanding answers of DHHS and Computer Sciences Corporation (CSC), the entity that created NCTracks based on a $484 million contract. On October 8, 2013, DHHS and CSC appeared before the Joint Legislative Oversight Committees on Health and Human Services and Information Technology to answer questions about NCTracks issues.
Remember, Sec. Aldona Wos stated, during the committee meeting, that DHHS was not warned by an entity of the risk to go live with NCTracks. To which, Auditor Wood stated, “For the secretary to say there was no independent or anybody else that had given them a look at their risk readiness for going live on July 1 was not a true statement to the committee, and we felt like that the committee needed to know that information.”
State Auditor Wood is the soothsayer. “Beware the first of July!”
Just as the soothsayer did for Caesar, prior to NCTracks going live, Wood warned DHHS that NCTracks was not ready. Just like Caesar, DHHS did not stop NCTracks from going live (he went to the theatre anyway). Just like Caesar’s death, the failure and ineptness of NCTracks was forewarned and could have been prevented. Both DHHS and Caesar ignored the warnings.
So how bad is NCTracks?
According to the December 2013 Performance Audit, “the NCTracks system has encountered more than 3,200 defects.”
Here are the Audit’s findings:
FINDING #1: THE DEPARTMENT HAS AN INADEQUATE FRAMEWORK FOR THE TIMELY RESOLUTION OF NCTRACKS DEFECTS
Since going live, the NCTracks system has encountered more than 3,200 defects. More than 600 defects remain unresolved at the time of the audit.
FINDING #2: THE DEPARTMENT LACKS A COMPREHENSIVE MASTER ACTION PLAN TO ADDRESS NCTRACKS ISSUES
The Department does not have a comprehensive and cohesive master action plan to direct the remediation of technical and operational NCTracks issues.
FINDING #3: NCTRACKS GOVERNANCE CHANGES PRESENT BUDGETARY AND SYSTEM CAPABILITY RISKS TO THE STATE
Since July 1, 2013, there have been major updates to the approach the Department will take to implement required capabilities. These changes present budgetary and system functionality risks to the State.
FINDING #4: STATE GOVERNMENT’S ‘REVOLVING DOOR’ CREATES A PERCEPTION OF BIAS OR CONFLICT OF INTEREST
A former DHHS employee who served for more than four years as the NCTracks Senior Program Manager and Associate Program Director now works for the NCTracks vendor, CSC, as the NCTracks Executive Account Director.
From Finding #4, it appears that CSC, like Brutus, is working hand in hand with DHHS.
If we do not learn from history, we are doomed to repeat it. “Beware the ides of March!”
Today State Auditor Beth Wood published the December 2013 “NCTracks Post-Implementation Performance Audit.” One of the key findings is that, since NCTracks went live, the NCTracks system has encountered more than 3,200 defects.
3200!!!
This is the second audit that Wood has conducted on NCTracks. The first audit was May 22, 2013, and expressly warned the Department of Health and Human Services (DHHS) that NCTracks was not ready to go live.
North Carolina has created the perfect storm when it comes to mentally ill…the perfect scenario for disaster. 10…9….8…..7……6…….5……..4………3………..2…………..
From 2001 to 2012, the total population of North Carolina increased from 8,203,734 people to 9,781,022. Over 1 and a half million more people live here now than twelve years ago. Which is understandable when you think about all the people relocating here.
The number of NC residents in need of mental health services has increased from 517,447 in 2001 to 613,379 in 2012 (not sure how many are on Medicaid). However, since 2001, the number of inpatient psychiatric beds has DECREASED by fifty percent (50%), from approximately 1,750 beds to approximately 850 beds. 850 beds!! Not even enough beds to serve 1/10 of the population in need!!
In the past, it was understandable to decrease the number of psychiatric beds. NC was doing a fairly decent, not perfect, by any means, but a decent job of providing community-based mental health services to those in need.
Those days of decent care for mentally ill Medicaid recipients are over. Instead, we have the perfect storm for utter disaster.
Enter main ingredient of the perfect storm…the managed care organizations (MCOs). In NC, we moved onlybehavioral health care to the MCOs. Basically, if you are on Medicaid and need any type of health care services, besides behavioral health services, you will never come into contact with an MCO. However, if you suffer from a mental illness, a developmental disability, or a substance abuse problem and rely on Medicaid for insurance, you have encountered the MCOs.
Prior to 2013 (except for the experimental 1st MCO, which was called Piedmont Behavioral Health, but now called Cardinal Innovations), the MCOs did not exist. Literally, the MCOs have gone “live” this year. The MCOs are new to being the gatekeepers of mental health services for Medicaid recipients in NC.
Not only do we have these new, inexperienced companies deciding which Medicaid recipients may receive mental health services, but we, in our great wisdom, gave them the monetary incentive to DENY services to recipients and to DENY providers Medicaid contracts, which is the 2nd ingredient for the perfect storm. Oh yes, we did all that! The MCOs are prepaid. So, in theory, the MCOs are taking the burden of risk (i.e., going over budget) off the State and onto themselves. If the MCOs go over budget, it is on the MCOs to come up with the money. However, in reality, the MCOs, to save on money and increase profit, are denying medically necessary services and terminating (or not enrolling) quality health care providers. See my blog “The NC Medicaid Mental Health 10-Ring Circus: How 10 Mini Jurisdictions Will Be the Downfall of Mental Health.”
Enter the 3rd ingredient to the perfect storm…the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA)’s complete absenceof supervision of the MCOs.
The MCOs have full reign and uninhibited authority to deny mental health care services, to terminate Medicaid provider contracts, or to refuse to contract with Medicaid providers with absolutely ZEROrepercussions (unless you hire an attorney (not necessarily me) and obtain an injunction) from DMA, from the federal government, from anyone. See my blog “The MCOs: Judge, Jury, and Executioner.”
[The equation for the perfect storm = the decreased number of psychiatric beds + increase in population + the increase of mentally ill residents + the MCOs + the monetary incentive for MCOs to deny services and not enroll providers + DMA’s complete lack of supervision]
As I am sure you are aware, a week or so ago, Virginia state Senator Creigh Deeds was stabbed multiple times by his son. Deeds was hospitalized for three days, but his son took his own life after stabbing his father. According to the media, Deeds’ son, Gus Deeds, suffered from severe mental problems and the day prior to the stabbing, an emergency custody order was sought. However, a psychiatric bed, reportedly, could not be found.
Sadly, the tragic story of Gus Deeds is too common. In Modern Healthcare this week, the feature story is called, “No Room for the Mentally Ill.”
The article discusses how the hospitals “are trying to collaborate with other hospitals to place psychiatric patients in open beds, using separate psychiatric EDs, setting up crisis triage centers, and referring patients to residential treatment centers.” See Modern Healthcare, dated November 18, 2013.
The hospitals may be acting in a self-serving manner. Most mentally ill patients, who are admitted to the ERs are not paying clients. The hospitals cannot turn a profit if too many non-paying clients are admitted to the ER. However, whatever the motivation, I say, thank goodness, and God bless the hospitals’ efforts!
Mentally ill, Medicaid recipients may be the demographic with the LEASTvoice of all demographics in existence.
Sadly, few care about poor people, and even fewer care about poor people suffering with MH/DD/SA. (When I say “care,” I mean will devote time, resources, and energy to them. I mean hire lobbyists for them, hire attorneys.)
Here, in NC, we are staring into the face of a perfect storm. If the hospitals can make headway with a bigger voice than those depending on Medicaid with behavioral health issues, God bless the hospitals, whatever the reason for their advocacy.
Because, perhaps, without the hospitals, we could be seeing:
The North Carolina State Medicaid Plan (State Plan) is constantly revised. The result of its constant revisions make for an 1800+ page, jumbled mess of plans, rules, amendments, and effective dates that make the State Plan as much fun to read as reading every volume of the Encyclopedia Britannica in Japanese with the aid of a Japanese translation dictionary.
First of all, what the heck is the State Plan? Basically, a State Plan is a contract between a state and the Federal Government describing how that state administers its Medicaid program. It “assures” the federal government that we, here in NC, will follow the State Plan because the federal government has “blessed” our State Plan. Whenever we need to change the State Plan, we file an amendment. In circumstances that call for much greater deviation from the State Plan, we can apply for a Waiver…or an exception.
On or about August 15, 2013, the Department of Health and Human Services (DHHS) issued a Public Notice “providing notice of its intent to amend the Medicaid State Plan for the purpose of defining the reimbursement methodology of Personal Care Services as directed by Section 10.9F of Session Law 2013-306 (House Bill 492). “
Personal Care Services (PCS) are Medicaid-covered, in-home services to recipients “who have a medical condition, disability, or cognitive impairment and demonstrates unmet needs for, at a minimum three of the five qualifying activities of daily living (ADLs) with limited hands-on assistance; two ADLs, one of which requires extensive assistance; or two ADLs, one of which requires assistance at the full dependence level. The five qualifying ADLs are eating, dressing, bathing, toileting, and mobility.” See DHHS Website.
In a letter dated September 30, 2013, and signed by Sec. Aldona Wos, DHHS sent what is called a SPA or a State Plan Amendment to the Centers for Medicare and Medicaid Services (CMS), in part, asking to be allowed to change the PCS unit rate from $3.88 to $3.28.
$3.88 to $3.28…
It may not sound like a huge decrease in pay to you, but a 60 cent drop per unit will be extremely harmful to providers who provide PCS services and, ultimately Medicaid recipients because less providers will be willing to serve the population.
One PCS unit is 15 minutes. There are 4 units in an hour. A 60 cent/unit cut to the rate will result in a $2.40 hourly cut.
Providers who employ staff who provide PCS are not paying staff upwards of $20/hour. Oh, no, most PCS providers make, maybe, $7-9.
Think about it…a small business provider of PCS (Let’s call it ABC Provider) employs 5-10 staff to provide PCS to recipients. ABC Provider has to pay its overhead (lease, office supplies, salaries of execs) plus pay the hourly wages of the PCS staff, and, supposedly, still make a profit…otherwise why even work?
For one hour of PCS, prior to a rate reduction, ABC Provider grosses $15.52/hour. Obviously, a portion of the $15.52 must go to overhead. ABC Provider pays her staff $9.00/hour. So ABC Provider nets $6.52/hour to pay for overhead. After 1000 man-hours, maybe ABC Provider can pays its rent and its utility bill. BTW: In order to reach 1000 man hours, it would take a person to work 41.66 days, 24 hours/day. Or it could take 10 staff working 10 hours/day for 2 weeks…just for the provider to make $6520 to pay bills…we aren’t even talking about profit…
After the rate reduction?
$2.40 has to be recouped somehow. Does the provider’s profit margin shrink or does the employee’s hourly rate decrease? Maybe a little of both.
According to the September 30, 2013, Sec. Wos letter, NC DHHS requested a retroactive date for the PCS rate reduction to July 1, 2013, or, in the alternative, October 1, 2013.
What? Retroactive reduced rates? Would DHHS recoup payments already made?
As of the day of this blog, I have not found out whether CMS approved the SPA sent to CMS September 30, 2013. I looked on CMS’ website. So if anyone reading has information as to whether CMS approved, is approving, denied, or is denying the rate reduction, I, as well as other people, would be much obliged for the information.
Extrapolated audits are no fun, unless you work for a recovery audit contractor (RAC). You get a Tentative Notice of Overpayment (TNO) that says the auditor reviewed 100 dates of service (DOS), found an overpayment of $1,000, so you owe $1 million dollars. Oh, and please pay within 30 days or interest will accrue…
North Carolina’s 2nd recovery audit contractor (RAC) is ramping up. HMS had a slower start than Public Consulting Group (PCG); the Division of Medical Assistance originally announced that HMS would be conducting post-payment reviews last October 2012 in its Medicaid Bulletin. NC’s 1st RAC, PCG came charging out the gate. HMS has been a bit slower, but HMS is active now.
HMS is performing post-pay audits on inpatient and outpatient hospital claims, laboratory, specialized outpatient therapy, x-ray and long-term care claims reviews.
According to the December 2013 Medicaid Bulletin, the findings for the first group of automated lab reviews were released in early November 2013. Additional lab reviews are expected to be completed and findings released by late December 2013. The post-payment reviews are targeting excessive drug screening.
And specialized therapy service providers, you are next on the list!
How will the providers know the results of an HMS post-payment review? Same way as with PCG. You will receive a Tentative Notice of Overpayment (TNO) in the mail with some crazy, huge extrapolated amount that you supposedly owe back to the state.
Remember, most of the post-payment reviews that I have seen have numerous auditing mistakes on the part of the auditor, such as the auditor applying the more recent clinical coverage policies rather than the clinical coverage policy that was applicable to dates of services audited.
DMA Clinical Policy 1S-4 “Cytogenetic Studies“, for example, was recently revised February 1, 2013. Obviously, an auditor should not apply the February 1, 2013, policy to a service provided in 2012…but you would not believe how often that happens!
So what can you do to be prepared? Well, realistically, you cannot be prepared for audit ineptness.
But you can be proactive. Contact your insurance policy to determine whether your liability insurance covers attorneys’ fees for regulatory audits. It is important to be proactive and determine whether your insurance company will cover attorneys’ fees prior to undergoing an audit. Because if you find out that your liability insurance does not cover attorneys’ fees, then you can upgrade your insurance to cover attorneys’ fees. I promise, it is way better to pay additional premiums than get hit with $25,000+ bill of attorneys’ fees. Plus, if you wait until you are audited to determine whether your liability insurance covers attorneys’ fees and you realize it does not, then the insurance company may not allow you to upgrade your insurance. The audit may be considered a pre-existing condition.
So…proactiveness is imperative. But you can always move to West Virginia…
In a survey of 18 states conducted by the National Conference of State Legislatures (NCSL) and published August 29, 2013, NCSL determined that 10 states use extrapolations with the RAC audits, 7 do not and 1 intends to use extrapolations in the future. (No idea why NCSL did not survey all 50 states).
Delaware, Maryland, New Hampshire, Pennsylvania, Vermont, West Virginia, and Wisconsin do not use extrapolations in Medicaid RAC audits.
FOR IMMEDIATE RELEASE
Monday, December 2, 2013 Contact: news@dhhs.nc.gov
919-855-4840
Raleigh, N.C. – The public is invited to the Medicaid Reform Advisory Group’s first meeting Dec. 5, 2013. The advisory group will collaborate with the Department of Health and Human Services in its development of a detailed plan to reform North Carolina’s Medicaid system. The public is encouraged to attend the meeting and become involved in improving health care in North Carolina while controlling escalating Medicaid costs.
The meeting will be held from 10 a.m. to 1 p.m., Dec. 5, 2013, at:
The Grill on the Hill
DHHS/Dorothea Dix Campus, behind the McBryde Building
The Medicaid Reform Advisory Group, as instructed by the General Assembly, will obtain broad stakeholder input in a public forum and ensure transparency in the proposal development process. The advisory group will work with DHHS as it explores all options to come up with the best plan for North Carolina, and has three citizens appointed by Governor McCrory, a state representative and senator:
Dennis Barry (Guilford County), advisory group chair – Barry is CEO emeritus of Cone Health, a multihospital system serving the Piedmont region of North Carolina.
Peggy Terhune (Randolph County) – Terhune is the executive director/CEO of Monarch since 1995. She has worked with people with disabilities for more than 35 years.
Richard Gilbert, M.D., M.B.A. (Mecklenburg County) – Dr. Gilbert has served as the chief of staff for Carolinas Medical Center and was the chief of the Department of Anesthesiology for Carolina’s Medical Center for 20 years.
Representative Nelson Dollar (Wake) – Appointed by House of Representatives Speaker Thom Tillis.
Senator Louis Pate (Lenoir, Pitt, Wayne) – Appointed by Senate President Pro-Tempore Phil Berger.
Since its inception in 1970, the N.C. Medicaid program has evolved into an essential component of the state’s health care system. It currently serves approximately 1.7 million low-income parents, children, seniors and people with disabilities.
The Medicaid Reform Advisory Group will hold additional meetings during which stakeholders will have the opportunity to publicly comment on the reform process. Public notices will be issued with the dates, times and locations.
DHHS will present a reform proposal to the General Assembly no later than March 17, 2014.
Knicole C. Emanuel is a Partner at Nelson Mullins, LLP in Raleigh, NC where she concentrates on Medicare and Medicaid regulatory compliance litigation. See legal disclaimer @ "About Knicole."
Follow her on Twitter at @medicaidlawnc.
