Category Archives: Medicaid Appeals
The Chevron Deference Rule: Pay Attention, Health Care Providers! CMS May Lose Control!
It has been nearly 40 years since the Supreme Court indicated in Chevron v. Natural Resources Defense Council that courts should defer to an agency’s reasonable interpretation of an ambiguous statute. Earlier this year, the Supreme Court heard arguments abolishing the Chevron deference rule. It that good or bad? Well, let’s hash it out. Regardless your opinion, the Supreme Court will decide the Chevron deference rule’s legality this summer. And, listening to the oral arguments earlier this year, it seems that a majority of the justices seemed ready to jettison the doctrine or at the very least significantly limit it.
The Chevron deference rule is a critical aspect of administrative law that often remains in the shadows of legal discourse but holds immense implications for the functioning of our government: the Chevron deference rule. This rule, born out of a Supreme Court case in 1984, has been a cornerstone of administrative law, dictating how courts should defer to federal agencies’ interpretations of ambiguous statutes. But as with any legal doctrine, it invites debate, scrutiny, and calls for reform.
In simple terms, the Chevron deference rule mandates that if a statute is ambiguous, courts should defer to the reasonable interpretation of that statute made by the agency tasked with implementing it, unless that interpretation is unreasonable. In essence, it grants federal agencies significant leeway in interpreting laws passed by Congress. This deference has profound effects on the balance of power between the branches of government. For example: CMS is an agency that is allowed deference in its rules that are not laws. See the importance? Without the Chevron deference rule, ALJs would not be bound by CMS’ rules that are not laws. For example, CMS is of the mindsight that extrapolation is legal, allowed, and upheld. The ALJs are bound to agree. No Chevron deference rule? The ALJs can make up their own minds.
The rationale behind Chevron deference is to recognize the expertise of administrative agencies in their respective fields. These agencies possess specialized knowledge and experience that enable them to navigate complex regulatory landscapes. By allowing them deference in interpreting ambiguous statutes, the rule seeks to promote consistency, efficiency, and expertise in policymaking and implementation.
However, as with any legal doctrine, the Chevron deference rule is not without its critics. Some argue that it unduly concentrates power in the hands of unelected bureaucrats, diminishing the role of the judiciary in interpreting the law. Moreover, it raises concerns about accountability and democratic legitimacy, as it can shield agency actions from robust judicial review.
Furthermore, the Chevron deference rule has become a subject of political contention, particularly in recent years. Critics argue that it enables regulatory overreach by agencies, allowing them to enact policies that may exceed the scope of their statutory authority. This concern has led to calls for judicial restraint and a reevaluation of the deference granted to administrative agencies.
So, should the Chevron deference rule stay in place? This question elicits a spectrum of opinions and requires careful consideration. On one hand, the rule promotes efficiency and expertise in governance, recognizing the specialized knowledge of administrative agencies. On the other hand, it raises concerns about accountability, democratic legitimacy, and the balance of power between the branches of government.
In navigating this complex terrain, we must strike a balance that upholds the principles of good governance, accountability, and the rule of law. Perhaps the solution lies not in abolishing the Chevron deference rule altogether but in refining it to address its shortcomings. This could involve clarifying the conditions under which deference is appropriate, ensuring robust judicial oversight, and promoting transparency and accountability in administrative decision-making.
The Chevron deference rule stands as a pivotal element of administrative law, shaping the relationship between the branches of government and influencing the course of public policy. Its effects are profound and far-reaching, touching upon fundamental principles of governance and democracy. As we navigate the complexities of modern governance, let us engage in thoughtful dialogue and debate to ensure that our legal framework reflects the values of accountability, transparency, and the rule of law.
Federal Court Vacates Two, Medicare ALJ Decisions with Extrapolations
Today is April Fool’s Day, but the story I am going to tell you today is no prank. On 03/25/2024, the U.S. District Court of the Southern District of Florida rendered its Decision on MedEnvios Healthcare, Inc. v. Xavier Becerra, in his official capacity as Secretary USDHHS. 2024 WL 1252264. The federal Court vacated two, ALJ Decisions upholding two, separate, extrapolated audits. This example highlights the importance of appealing ALJ Decisions to federal court, which will uphold the law versus CMS Rules.
MedEnvios is a durable medical equipment provider (DME). It was the target of two Medicare audits and both audits were extrapolated. MedEnvios’ argument is two-fold: (1) that its due process rights were violated because HHS failed to comply with the procedures set forth in statute, regulation, and “sub-regulatory guidance” that mandate “certain due process minimum protections be provided to health care suppliers in the statistical sampling and extrapolation process.” (Pl.’s Resp. at 9.) Specifically, MedEnvios objects to the Defendant’s exclusion of claims for which the Department never made a payment to MedEnvios from the sampling frame. Obviously if the zero-claims are not removed the number will be inflated or maybe even surpass what was actually paid to the provider during the specific timeframe. And (2) MedEnvios argues that the Defendant failed to provide sufficient documentation to support overpayments recalculated following partially favorable appellate decisions, allegedly depriving MedEnvios of notice. Following partially favorable decisions on appeal, the relevant contractor must “effectuate” the decision by recalculating the extrapolated overpayment amount to be recouped from the supplier based upon the revised decisions on individual sampled Medicare claims. The contractor then sends the supplier a revised demand letter reflecting the new overpayment amount. Without the underlying documentation showing how the contractor arrived at the new amount, MedEnvios claims that it lacked “the information necessary to mount a meaningful challenge to those recalculations.”
I bet that many readers today have felt the pain of having to defend themselves from an audit and knew the auditor was withholding data or documents, yet felt powerless. This Decision says it is not ok to not give all the information. The Court held that MedEnvios was and is prejudiced by the unavailability of the recalculation worksheets because MedEnvios did not receive three of the four relevant recalculation worksheets within enough time to satisfy its procedural due process rights by recreating the recalculations to verify the revised extrapolated amounts.
The Court held that the prejudice to MedEnvios in having to mount appeals without reviewing the contractors’ effectuation work easily outweighs any administrative difficulty of timely providing the worksheets. Provision of this information should be a negligible burden on the Department and its contractors. The MPIM already instructs that “[d]ocumentation shall be kept in sufficient detail so that the sampling frame can be re-created should the methodology be challenged. The contractor shall keep an electronic copy of the sampling frame.” MPIM § 8.4.4.4.1. Thus, contractors are already required to maintain this information, and the added burden of providing the information on request would be minimal. The Court therefore concludes that the Department has run afoul of MedEnvios’s procedural due process rights by failing to provide the documentation supporting the recalculated overpayment amounts.
So, what is the remedy for the Department’s failure to timely provide documents showing how the revised overpayment demands were calculated?
This Court vacated both ALJ Decisions upholding the two extrapolated amounts. This is a perfect example of why providers MUST appeal ALJ Decisions to federal court. The difference in the law and CMS’ Rules is vast. Not enough providers continue their appeal to federal court because of money. Litigation is expensive. However, in this case, attorneys’ fees were, most likely, much less than what CMS was alleging MedEnvios owed.
Have a great April Fool’s Day. Play a prank on a colleague. At the office, put tape under a coworker’s computer mouse, and watch them try to figure out why it’s not working!
Two Success Stories: (1) Getting a Provider’s Suspension of Medicaid Reimbursements Lifted; and (2) NCSU Wins the ACC!
A quick shout out to NC State University, my undergraduate alma mater, who won the ACC Tournament, beating out #1 ranked UNC!!!
I love legal success stories too. Because when my team wins, health care providers win.
Well, my firm and I had a success that I must share amongst my blog readers. I gave this blog a live read on RACMonitor this morning on Monitor Monday, so if you want to hear me read it, go to wherever you listen to podcasts and search for RACMonitor. I present on RACMonitor every Monday morning and have done so for the last 10 years!
One of my clients, a substance abuse facility, which provides SAIOP and SACOT services to the underserved in Idaho, is under civil and/or criminal investigation. The investigation began over two years ago, which is a material fact in this case. The substance abuse facility was being accused of health care fraud because it gave out gift cards and allegedly billed for services not rendered.
As for billing for services not rendered, we vehemently disagree, and the government has not provided any proof of such for the last 2 years. As for the gift cards, many of you may not know that in March 2022 the Office of Inspector General for the Department of Health and Human Services (OIG) published an Advisory Opinion in support of such activity. The OIG had published similar language in the past as well.
OIG stated that patient incentives (e.g. gift cards or cash equivalents) given as part of patients’ treatment plans are favorable and allowable. Though the OIG reiterated its concern that cash and cash equivalents given to patients can present substantial fraud and abuse risks, the OIG concluded that the arrangement presented a minimal level of risk.
For over two years, this company and its CEO have known that it is under civil and/or criminal investigation. The facility continues to provide medically necessary service throughout the investigation. Then, unexpectedly, on 12/22/2023, right before Christmas, facility receives a notice that the Department of Health Services, Division of Health Benefits has suspended the company’s Medicaid reimbursements. The company relies 100% on Medicaid.
The State does have the authority to suspend reimbursements. 42 CFR 455.23 states:
“(1) The State Medicaid agency must suspend all Medicaid payments to a provider after the agency determines there is a credible allegation of fraud for which an investigation is pending under the Medicaid program against an individual or entity unless the agency has good cause to not suspend payments or to suspend payment only in part.”
The owner contacted me and explained that the company could not last 1 month without receiving Medicaid reimbursements for services rendered. It was catastrophic. His two facilities constitute over 24% of Idaho’s substance abuse facilities in the State. There would be a serious access to care issue, especially in southern Idaho.
I reviewed the Notice of Suspension, and appeal rights appeared there. I say it like I am astonished because I am astonished.
I have never seen appeal rights be given for “credible allegations fraud” under 42 CFR 455.23.
We appealed.
We won!
I argued threefold: (1) there is no credible allegation of fraud because the allegations that services were billed but not rendered is wrong and presenting gift cards is not illegal when dealing with substance abuse; (2) that nothing has changed since the investigation over two years ago, He has been rendering services during his investigation. Why now arbitrarily invoke a penalty on the facility when the government has been investigating for over two years. Why two years later suspend when seemingly nothing has changed. And (3) that the suspension was a violation of his due process.
Specifically, the court held that the State has had two years to investigate any allegations but for two years no action was taken, and no findings provided. Now, the State has decided to arbitrarily and capriciously suspend Medicaid payments to the provider. The suspension of Medicaid payments should be removed because the suspension is improper for a failure of there being any credible allegation of fraud. Additionally, the provider did not receive adequate notice and a chance for a hearing before the suspension action was taken. The suspension of payment is causing irreparable harm that will lead to the provider having to close their business of providing mental health and substance abuse services.
And just like that the suspension was lifted and the provider remains in business. I call that a win! And congratulations to NCSU Wolfpack! We were seeded #10, but ended up #1 of the ACC. We are seeded #11 in the Southern Division of the NCAA. And, yes, I chose NCSU to win the NCAA in my office pool. Go Pack! Can you pick me out from the below picture from 1994?
Or the one above from 1996?
In Medicare Provider Audits, the Best Defense Is a Good Offense
Today I want to discuss upcoming 2024 audits. It has been almost four years since the world shut down due to COVID. Life has been divided into “before COVID” and “after COVID.” Before COVID, the Centers for Medicare and Medicaid Services (CMS) aggressively pursued audits against durable medical equipment suppliers, home health, hospice, behavioral health, long term care facilities and hospitals. When COVID hit, most audits were paused. But not for long. As you know, CMS resumed its audit activities as early as August 2020. However, in the world of COVID, there were exceptions to every rule, many of which were state specific. Even exceptions had exceptions. It is imperative that you maintain for your type of health care service every policy, exceptions, bulletins, advisory opinions from 2020 through the present. If you have not assigned this task to someone in your facility, do it today.
We have seen an uptick in increased audit activity with pneumonic compression devices (PCDs). PCDs were not listed in the top error rates for the 2021 Improper Payment Report, but in the 2023 report, PCD’s have the second highest error rate behind oral cancer drugs at 78.9%. With an error rate that high, PCD’s will be a focal point of audits. Other items identified in the 2023 improper payment report for having high error rates include urological supplies, parenteral and enteral nutrition, manual wheelchairs, and various orthoses. These items will all see increased audit activity in the upcoming year. Basically, as long as the error rates remain high, audit activity will continue.
Surgical dressings have also been consistently audited. Surgical dressings are relatively a complex product to bill. DME suppliers of surgical dressings and physicians who order surgical dressings are seeing an uptick in denials. The 2021 Medicare fee for service supplemental improper payment report covering claims from July 1st, 2019, through June 30th 2020, listed surgical dressings as having the highest improper payment rate at 69.7%, followed closely by therapeutic shoes with an error rate of 67.9%. Since then, there has not been much improvement. The 2023 Improper Payment Report covering claims submitted between July 1st, 2021, and June 30th, 2022, shows the improper payment rate for surgical dressings is still at 62.1%. Therapeutic shoes did show some improvement with an improper payment rate of 51.4%, but this is still significant. For the 2023 reporting period, insufficient documentation accounted for 82.4% of improper payments for surgical dressings. Other types of errors for surgical dressings were no documentation at 1.9%, medical necessity at 1.7%, incorrect coding at 1.9% and other at 12.2%.
Targeted Probe and Educate (TPE) were some of the first audits resumed by CMS. Recovery Audit Contractor (RAC) audits are also increasing. I consider RACs to be the bounty-hunters of Medicare and Medicaid. Audits of skilled nursing providers are going to see a hike this year, with a growing number of federal and state recovery audits adding to specialized compliance reviews announced last year. In 2023, regulators instituted audits of facilities using potentially inappropriate diagnosis of schizophrenia as well as a new, 5-claim audit of every US nursing home that was specifically meant to root out improper payments. CMS came under additional pressure this past summer. That’s when the Government Accountability Office said the agency needs to do a better job of recouping overpayments. What do we think CMS will do in light of the GAO instructing the agency to do a better job recouping? The answer is: audit more. But, as they say in football, the defense is a good offense. The same is true in Medicare and Medicaid provider appeals. Be prepared.
Medicare Can Force a Whistleblower to Dismiss When Smoking Gun is Smoke and Mirrors
2024 has already proven to be audit heavy. It seems that the repercussions of COVID are beginning to appear. Actions related to COVID, such as audits of dates of service (“DOS”) during COVID are commonplace now. Whistleblower actions also seem to be on the rise.
We have even seen a few qui tam actions going forward even though the government did not intervene, which is rare, to say the least. In most cases, if the government does not intervene, usually, the whistleblower dismisses the case. The last qui tam action that I was worried was going to forward even though the government refused to intervene was a cardiologist practice. The number one reason that these super educated cardiologists were even on the metaphoric chopping block was because English was not the first language of any doctor employed by the practice. Imagine how smart you have to be to not only become a doctor, but to become a doctor in a country where you do not even speak the native language – to me – this is remarkable. The facility at issue employed 9 remarkable cardiologists, and, no surprise, the practice was the best and most desirable in the area. Plus, the practice was undergoing a possible acquisition by a nearby hospital, which was in the best interest of the doctors. The cardiologists were less than stellar business owners, but excellent doctors.
What happened was one of the senior cardiologists wrote an email that the whistleblower and the government, at first, took as a smoking gun. The doctor disseminated the email to everyone. Including the staff. This is what it said,
“…going forward, bill everything at a 99215; no matter what.”
The Feds believed that they had a smoking gun. Wouldn’t you?
99215 is Procedure Code 99215: Evaluation and Management Description for 40 minutes.
What the good doctor meant was this…COVID is upon us. Remember that? The times were so crazy and hectic in the health care world, which is why I am infuriated that the government is conducting audits of DOS during COVID. Sorry. Can we not give a “GET OUT OF JAIL FREE card” to all those providers who continued services in the midst of COVID?
What the misunderstood cardiologist meant by saying, “bill everything at a 99215 no matter what” was … we are in midst of COVID; this is worldwide pandemic. We are specialists. We are cardiologists. Anytime someone comes to us, it’s at least a 99214. During COVID, OF COURSE EVERY VISIT IS A 99215.
But that’s not what the government read. Which is why defense lawyers exist.
In this instance, I was afraid that the whistleblower would go forward regardless what the government decided. But I was wrong. Apparently, we were so convincing to the government that the government actually demanded the whistleblower to dismiss.
I did not know this until this case, which was only about 7 years ago, that in rare circumstances, the government can force a whistleblower to dismiss even if the whistleblower is gung ho.
In this case, the whistleblower was “gung ho.” But the government was adamant that there was no fraud since the “smoking gun” was, in reality, neither a gun nor was it smoking.
Since January of 2021, CMS and OIG accept anonymous and confidential whistleblower disclosures. Can you imagine your competitor accusing you of fraud in order to get your consumers? It happens. In fact, next blog, I will tell you a story of two specialized dental practices in Minnesota. And how one practice purposefully and nefariously accuses the other of fraud. That accusation resulted in a two-year reimbursement suspension for the accused practice which resulted in the business closing. The accuser facility is thriving and opened up three new offices. Is this really what are fraud laws are intended to do. The laws are being used to put competitors out of business, not finding fraud.
NC Medicaid Providers Lost Their Property Right in the Continued Participation in Medicaid, According to COA
According to the 4th Circuit Court of Appeals, health care providers possess a property right interest in the continued participation in Medicare and Medicaid. Nationally, the Circuits are split. The rule is, at least in the 4th Circuit, that termination for cause of a provider’s Medicaid contract is allowed, if the cause is correct and the provider was afforded due process. On October 5, 2023, the NC Court of Appeals deviated from legal precedent and ruled no property right exists in B&D Integrated Services v. NC DHHS and its agent Alliance. The COA held that Alliance, a managed care organization (“MCO”) could terminate any provider for any cause at any time for any reason. The 4th Circuit and I beg to differ. I read the Decision, and the Petitioner, unfortunately, according to the Decision, failed to argue that it has a property right in continued participation in Medicaid. I have no earthly idea why Petitioner argued what it did, which is that OAH has no jurisdiction over provider appeals and the OAH decision should be vacated. I have no idea why Petitioner thought that was a good argument. I don’t know if arguing the property right argument would have resulted in a victory, but, to me, it is the most compelling argument. Petitioner failed to argue that MCOs are paid by the tax payor; MCOs are not private companies, so MCOs are agents of the State and must follow pertinent regulations. Instead, Petitioner argues that OAH does not have jurisdiction???? Curiouser and curiouser.
That was not the right argument to make.
And now, unless the General Assembly changes the law, B&D Integrated Health Services v. NC DHHS and its agent Alliance Health, holds that “Alliance was contractually allowed to terminate the contract, with or without cause or for any reason, upon 30 days’ notice.” Which is precisely what I have argued against for the last 15 years or so. See blog. And blog. And blog.
These MCOs are bequeathed a fire hose of tax dollar money and whatever they don’t spend, they keep for bonuses for the executives. Therefore, it is in the MCOs’ financial best interest to terminate providers, which means all the terminated providers’ consumers are immediately cut-off from their Medicaid services, and the MCO saves money.
The following paragraphs are from a Decision from OAH holding that Medicaid contracts are NOT terminable at will:
“In determining whether a property interest exists a Court must first determine that there is an entitlement to that property. Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532 (1985). Unlike liberty interests, property interests and entitlements are not created by the Constitution. Instead, property interests are created by federal or state law and can arise from statute, administrative regulations, or contract. Bowens v. N.C. Dept. of Human Res., 710 F.2d 1015, 1018 (4th Cir. 1983). Under North Carolina case law, the Fourth Circuit Court of Appeals has determined that North Carolina Medicaid providers have a property interest in continued provider status. Bowens, 710 F.2d 1018. In Bowens, the Fourth Circuit recognized that North Carolina provider appeals process created a due process property interest in a Medicaid provider’s continued provision of services, and could not be terminated “at the will of the state.” The court determined that these safeguards, which included a hearing and standards for review, indicated that the provider’s participation was not “terminable at will.” Id. The court held that these safeguards created an entitlement for the provider, because it limits the grounds for his termination such that the contract was not terminable “at will” but only for cause, and that such cause was reviewable. The Fourth Circuit reached the same result in Ram v. Heckler, 792 F.2d 444 (4th Cir. 1986) two years later. Since the Court’s decision in Bowen, a North Carolina Medicaid provider’s right to continued participation has been strengthened through the passage of Chapter 108C. Chapter 108C expressly creates a right for existing Medicaid providers to challenge a decision to terminate participation in the Medicaid program in the Office of Administrative Hearings. It also makes such reviews subject to the standards of Article 3 of the APA. Therefore, North Carolina law now contains a statutory process that confers an entitlement to Medicaid providers. Chapter 108C sets forth the procedure and substantive standards for which OAH is to operate and gives rise to the property right recognized in Bowens and Ram. Under Chapter 108C, providers have a statutory expectation that a decision to terminate participation will not violate the standards of Article 3 of the APA. The enactment of Chapter 108C gives a providers a right to not be terminated in a manner that (1) violates the law; (2) is in excess of the Department’s authority; (3) is erroneous; (4) is made without using proper procedures; or (5) is arbitrary and capricious. To conclude otherwise would nullify the General Assembly’s will by disregarding the rights conferred on providers by Chapter 108C. This expectation cannot be diminished by a regulation promulgated by the DMA which states that provider’s do not have a right to continued participation in the Medicaid program because under the analysis in Bowen the General Assembly created the property right through statutory enactment.” Carolina Comm. Support Serv, Inc., at 22.
Carolina Comm. Support Serv., Inc. v. Alliance Behavioral Healthcare, 14 DHR 1500, April 2, 2015.
ALJ Decisions determining a property right exists went on to be upheld by the 4th Circuit. However, this new NC COA decision, B&D Integrated Health v. NC DHHS, threatens all providers. The reason that termination at will does not work for Medicare and Medicaid versus a private companies’ right to terminate:
- These are our tax dollars, not private money.
- It allows discrimination.
- It allows subjectivity.
- It allows bias.
- It allows an entity to overnight prevent consumers from receiving medically necessary health care services.
- It allows for an entity to, overnight, cause hundreds of staff members to lose their jobs.
B&D Integrated Health v. NC DHHS is a bad decision for health care providers. The Petitioner lost its case because it made the wrong argument. Its argument that administrative courts have no jurisdiction was a losing argument. Now State and federal contractors have more power to be subjective and discriminatory.
Now we have NC case law in State Court that fails to follow federal case law in the 4th Circuit.
There Is No Law to Be Perfect in Medicare; Just Self-Disclose!
We all know that there is no law, regulation or statute that medical records supporting payment by Medicare or Medicaid must be perfect. There is no mandatory 100% compliant standard. Because humans err. In light of the ongoing financial strain brought about by the pandemic and the constraints imposed by Congress on Medicaid coverage disenrollments, State Medicaid agencies are poised to explore additional audits to manage increasing Medicaid expenditures. Recent developments, such as additional flexibilities granted by CMS, suggest a shifting landscape in how States respond to these challenges.
Anticipating a more assertive approach by States in dealing with service providers, potential measures could include rate cuts and enhanced scrutiny through service audits. This prompts a crucial examination of States’ and providers’ rights under federal Medicaid law to audit service provisions and recover overpayments, a legally intricate and noteworthy domain.
Medicaid RAC Audits are governed by 42 CFR 455 Subpart F—Medicaid Recovery Audit Contractors Program. Other Medicaid alleged overpayments are dictated by 42 CFR Chapter 433.
To establish a foundational understanding, it’s essential to consider the mandate imposed by Congress in section 1902(a)(30)(A) of the Social Security Act. States are required to incorporate provisions in their Medicaid plans to “safeguard against unnecessary utilization of … care and services.” This underscores the federal interest in ensuring responsible use of matching funds, given the federal government’s financial contribution to the program.
A landmark case illustrating the complexities of this mandate is the 1999 decision by the Supreme Judicial Court of Massachusetts in Massachusetts Eye and Ear Infirmary v. Commissioner of Medical Assistance. The court evaluated Massachusetts Medicaid’s retrospective utilization review policy, emphasizing the need for meaningful definitions of terms like “inpatient” and “outpatient” to avoid arbitrary penalties on providers.
Moving to the realm of overpayments, CMS regulations, specifically at 42 C.F.R. § 433.316, provide guidance on how States should proceed when identifying overpayments. The regulations recommend written notification to providers, with states having the discretion to choose whether to notify in cases of suspected fraud. Furthermore, States are required to take “reasonable actions” based on state collections law to recoup overpayments, with a one-year timeframe to return the federal share of identified overpayments to CMS.
Determining when a State “discovers” an overpayment is a critical aspect outlined in the regulations. The discovery is pegged to specific events, such as the state contacting the provider, the provider notifying the state, formal initiation of recoupment, or a federal official identifying the overpayment. Significantly, the regulations focus more on CMS’s relationship with the state than on the state’s relationship with providers.
Recent legal precedents, such as the Wisconsin Supreme Court’s decision in Professional Home Care Providers v. Wisconsin Department of Health Services, underscore the need for states to operate within the bounds of their granted authority. In this case, the court rejected a Medicaid agency’s “perfection” policy, emphasizing that state law must align with CMS regulations in overseeing overpayment recovery.
As States grapple with revenue shortfalls exacerbated by the pandemic, the potential for increased efforts to recoup overpayments from providers looms large. Legal challenges, exemplified by recent decisions in Massachusetts and Wisconsin, underscore the delicate balance States must strike in these endeavors, emphasizing the limits within which they must operate as they navigate the complex terrain of Medicaid law and financial constraints.
Expect audits. Be ready to defend yourself. Self audits are so important. If you self audit and find a problem and self-disclose, you will not receive penalties. Self-disclosures are key. When I told a group of law students this key information, one asked, has you told a client to self-disclose and they refused? To which I said yes. One time. A female doctor informed me that she falsified 7 medical records, I said that she should disclose. She screamed at me in her language, fired me, and hired a new attorney and withheld the information about falsifying records.
She is jail currently.
RAC Audits Are BOO-Very Scary, and, Sometimes, Are DEAD wrong!
For Monitor Monday, today, October 30, 2023, I dressed up as a RAC auditor. BOO!!! I get a spooky 13.5% commission for overzealous auditing tactics. RAC auditors come in every shape and size, color or gender.
In my experience, RACs are garishly incorrect in their assessments. I will reveal three, real life examples where these audit contractors accused healthcare providers of owing money but were found to be dead wrong:
Example 1 – Medical Necessity quibbles:
In a haunting case involving a hospital, the RAC alleged that certain cardiac procedures were billed inappropriately, citing concerns about the medical necessity of these services. They claimed the hospital should refund a repugnant amount for these procedures. However, upon closer examination and an appeal process, it was revealed that the services were indeed medically necessary and aligned with the standard protocols. The ghastly RAC’s accusation was disproven, and the hospital was not required to return any funds. Spine-tingling!
Example 2 – Improper Coding of Diagnosis:
A healthcare provider, particularly a large physician group, was accused by the RAC of using suspicious, improper diagnostic codes, leading to overbilling for certain services provided to Medicare and Medicaid beneficiaries. After a thorough internal audit, it was determined that the codes used were accurate and supported by the patient’s medical records. The RAC’s allegations were unfounded, and no repayment was required. Suspicious. A haunting reminder to spook audits.
Example 3 – Alleged Duplicate Billing:
In a murderous case involving a nursing facility, the RAC identified what they believed were instances of duplicate billing for certain procedures and services. Upon further review, it was revealed that the billing discrepancies were due to the RAC’s misunderstanding of the facility’s billing processes. Mysterious. The facility provided evidence showcasing that the billed services were distinct and not duplicates. Consequently, the RAC’s claim was refuted, and no repayment was deemed necessary. Suspicious.
These examples underscore the critical need for providers to have robust internal compliance measures in place. While RACs serve a vital purpose in identifying billing errors, they are not infallible. Providers need to be equipped to challenge these audit findings, ensuring they are based on accurate and comprehensive information.
It’s crucial for healthcare providers to engage in a proactive approach by conducting their internal audits, maintaining accurate documentation, and being prepared to challenge RAC determinations when necessary. These efforts not only protect providers from unwarranted financial obligations but also ensure that Medicare and Medicaid funds are appropriately allocated.
In conclusion, the relationship between RACs, healthcare providers, and government healthcare programs is complex. The examples provided demonstrate that while RACs play a critical role in safeguarding the integrity of Medicare and Medicaid, their findings are not always accurate. Providers must be diligent in ensuring their billing practices align with regulations and be prepared to contest any erroneous audit findings to maintain fiscal stability and fair reimbursement for services rendered.
Happy Halloween!!!!
The No Surprises Act and How It Can Benefit You, Personally! YOU WANT TO READ THIS BLOG!
Surprisingly, I am talking about the No Surprises Act today. Last year, I had an unwelcome surprise. I was thrown from my horse on February 20, 2022. I’ve been thrown from many horses, and usually, I land on my boots or, at worst, my behind. However, last year, I awoke in the ICU after being thrown from a horse. Surprise! Spoiler alert, I ended up ok, according to most. However, I was helicoptered from the extremely rural area to the closest hospital. And you are probably thinking that I was blessed that someone could contact and obtain a helicopter so quickly for me…it probably saved my life. And you may be right. But there are two things about me that you probably don’t know: 1) my best friend in life is an ER Trauma nurse with over 20 years’ experience; and (2) I don’t like to spend $49,753.00 for a helicopter ride that I don’t even remember.
Let me explain. As I said earlier, I was unconscious when someone contacted a helicopter. Let me tell you who I was with. Let me set the stage, so to speak. I was with my husband Scott, my bff Tracey – the ER trauma nurse, and her husband Josh. I never asked them, because, quite frankly, I didn’t think to ask who called the helicopter until now. Regardless, I was helicoptered, and received a bill a month or so later for almost $50k. And I freaked.
I am without a doubt even more sympathetic to my provider-clients who get notices of owing tens of thousands or millions of dollars. That $50k stopped my heart for a second. Then, I thought, Dr. Ronald Hirsh and others have spoken about the NSA multiple times on Monitor Monday. Maybe I should re-listen to a couple, really good, detailed podcast episode. I did so.
Last year, in my unconscious-state, I would have entrusted my life with Tracey to drive me about 30 minutes to a hospital because:
- She is an ER Trauma nurse.
- She is good at her job. She was handed a decapitated arm once. I am sure I would have had nightmares, not she.
- She works at the nearest hospital and it was only 30 minutes away. She is/was friends with the ER surgeons. So, yes, had you asked me whether I wanted a $50k helicopter ride or a 30-minute ride with an experienced ER Trauma nurse – I would have chosen the free one. that, from some of her stories, I think may be more experienced than the MDs she performs under.
However, after I presented this story on RACMonitor, Dr. Hirsch, along with several listeners, one of whom is an emergency physician, told me that they would NEVER recommend a private transfer to the hospital, even if Dr. Hirsch were driving, especially for an unconscious, head injury victim. I was told that the helicopter was the way to go in my case, but that I should not be liable for it. I agree, hence the NSA. However, in the same vein, providers need to be paid. Remember, this paragraph was written after RACMonitor and after I was told the helicopter was the way to go.
However, had you asked me then, I would have chosen the free ride to the hospital. Post haste!!! Instead of getting my consent to pay $50k for a helicopter ride or a free ride with an ER Trauma nurse, I was “forced” to the helicopter. And here is where the NSA gets confusing. It was effective January 2022. The political issue arose a stark “T” or perpendicular “behind a rock and a hard place.” A month or so after my accident, I got the bill for almost $50k. Like I said, my heart palpitated. Just like the doctors, hospitals, DME providers, dentists, LTCF, HH, BHP, and anyone who accepts Medicare or Medicaid hearts’ would palpitate when they receive a bill for tens of millions of dollars that they may or may not truly owe.
The DOS happened to be one month after the NSA went into effect. No one wanted to pay for this ride. My health insurance went to bat for me; or, really, for them. My health insurance also didn’t want to pay for my $50k helicopter ride. The letter from my insurance company to the helicopter company said: “Upon review of your request, we have confirmed the claim was processed according to the terms of the No Surprises Act (NSA). Accordingly, your request does not qualify as an appeal under the terms of the member benefit plan.”
While I agree that I should not have been liable for a $50k helicopter ride, I do have empathy for the helicopter company and its nurses. It expended money on my behalf. And I am appreciative. I feel like there should be a less Draconian law than the NSA. Because of my being unconscious during my helicopter admission and my lack of ability to consent, shouldn’t mean the providers shouldn’t be paid for services rendered.
But maybe the letter, which ostensibly shuts down any appeal to additional funds by the provider, means that the provider was paid an amount, maybe a reduced amount, but an amount nonetheless. If anyone knows whether surprised patients’ medical bills get paid at a reduced rate, let me know! Thanks!
NC Medicaid Expansion: More Consumers, Not More Providers!
Republican-run Congress passed Medicaid expansion today, March 23, 2023.
Today North Carolina took a commendable step forward in healthcare by expanding Medicaid to cover more low-income individuals. Now there are 10 States that have not expanded Medicaid. This decision will provide much-needed healthcare coverage to over 600,000 people in the state who previously did not have access to affordable healthcare. North Carolina has 2.9 million enrollees in traditional Medicaid coverage. Advocates have estimated that expansion could help 600,000 adults. In theory. On paper.
As a legal professional, I commend the North Carolina lawmakers for making this decision. The expansion of Medicaid will go a long way in improving the health and wellbeing of North Carolinians. It is well known that access to quality healthcare is critical for people to lead healthy and productive lives. By expanding Medicaid, the state is taking a proactive step towards ensuring that its citizens have access to the healthcare they need.
However, it is important to note that despite this expansion, many healthcare providers still do not accept Medicaid due to low reimbursement rates and regulatory burdens. This is a major issue that must be addressed if the benefits of the expansion are to be fully realized.
According to a report by the Kaiser Family Foundation, Medicaid patients often face significant challenges in accessing healthcare services due to a shortage of healthcare providers who accept Medicaid. In North Carolina, as of 2021, only 52% of primary care physicians accept Medicaid patients, while only 45% of specialists accept Medicaid patients. 600,000 North Carolinians will get a Medicaid card. A card does not guarantee health care services. See blog.
One area that has been severely impacted by the shortage of Medicaid providers is dental care. According to the American Dental Association, only 38% of dentists in the United States accept Medicaid patients. This has led to many low-income individuals going without essential dental care, which can lead to more serious health issues down the line. Remember, Deamante Driver? See blog.
Another area that has been impacted by the shortage of Medicaid providers is nursing homes. In many cases, nursing homes that accept Medicaid patients struggle to find healthcare providers willing to provide care to their residents. This can lead to residents going without essential medical care, which can have severe consequences.
Specialists are another area where the shortage of Medicaid providers is particularly acute. According to the Kaiser Family Foundation, only 45% of specialists accept Medicaid patients. This can be especially challenging for patients with complex medical needs, who often require specialized care.
The shortage of Medicaid providers is a complex issue that requires a multifaceted solution. One approach is to increase reimbursement rates for healthcare providers who accept Medicaid patients. This would incentivize more healthcare providers to accept Medicaid patients, thereby increasing access to healthcare services for low-income individuals.
Another approach is to reduce regulatory burdens for healthcare providers. This would make it easier for healthcare providers to participate in Medicaid, thereby increasing access to healthcare services for low-income individuals.
These statistics highlight the urgent need to address the issue of low reimbursement rates and regulatory burdens faced by healthcare providers. If more providers are incentivized to accept Medicaid patients, more people will have access to the care they need, and the benefits of the expansion will be fully realized.
In conclusion, North Carolina’s decision to expand Medicaid is a significant step forward in healthcare, and it should be applauded. However, it is crucial that policy change to incentivize providers to accept Medicaid. From dental care to nursing homes and specialists, low-income individuals who rely on Medicaid face significant challenges in accessing essential healthcare services.
