Category Archives: Post-Payment Reviews
E/M Codes and When You Should NOT Fire Your Attorney!
Lately, I have been inundated with Medicare and Medicaid health care providers getting audited for E/M codes. I know Dr. Hirsh has spoken often about the perils of e/m codes. The thing about e/m codes is that everyone uses them. Hospitals, family physicians, urgent care centers, specialists, like cardiologists. Obviously, for a specialist, like cardiology, the higher level codes will be more common. A 99214 will be common compared to a generalist like a primary care physician, where a 99213 may be more common.
Here’s a little secret: the difference between a 99214 and 99213 is subjective. It’s so subjective that I have seen auditors who are hired by private companies to audit on behalf of CMS and are financially incentivized to find fault find 100% error rates. Who finds a 100% error rate? Not one claim out of 150 was compliant. Then, I come in and hire the best independent auditors or coders. There are generally two companies that I always use. The independent auditors are so good. Most importantly, they come in and find a much more probable error rate of almost zero.
Hiring an independent, expert coder to ensure that the RAC, MAC, UPIC, or TPE audits accurately is always part of my defense.
Recently, I learned what I should have known a long time ago, but is essential for our listeners to know. If your medical malpractice is with The Doctors Company, for free, you get $25k of – what TDC calls – Medi-Guard or regulatory compliance protection. In other words, you get audited by a UPIC and are informed that you owe an alleged $5 million, extrapolated, of course, you get $25k to pay an attorney for defense. Sadly, $25k will not come close to paying your whole defense, but it’s a start. No one scoffs at “free” money.
When accused of an alleged overpayment, placed on prepayment review, or accused of a credible allegation of fraud, your reimbursements could be in imminent danger of being suspended or recouped. It is imperative for the health care provider to stay apprised of what penalties they are facing. You want to know: “best case scenario and worst case scenario.”
And, providers, be cognizant of the gravity of your situation. Infringement of the false claims act can result in high penalties or jail, depending on the circumstances and the provider’s attorney. I had a client, who is an M.D. psychiatrist. She asked me what is the worst penalty possible. I am blunt and honest, apparently to a fault. I didn’t miss a beat. “Jail,” I said. She was horrified, called her insurance company, and requested a new attorney. TDC refused to fire me, so the doctor said that she will draft the self-disclosure herself. She also said that she submitted the falsified documents to the UPIC, so she was confident that the UPIC would not notice, but see below, time stamps are a bitch.
When I told the doctor that we needed to self-disclose to OIG because she had some Medicare claims, she screamed, “No! No! NO!” It was a video call and my sound wasn’t up loud, and I just watch her on the screen with her face all contorted and her mouth getting really big, then contract, then get really big, then contract, then get really big and then even bigger. The expert certified coder was present for the call, and he called me afterward asking me: “What was that?” And his wife, who overheard, said, “OMG. I would have lashed out.” I kept my cool. Honestly, I just felt bad for her because I can see the writing on the wall.
Obviously, a new attorney is not going to change the outcome. She falsified 17 dates of service because she wanted the service notes to be “perfect.” Well, providers, there is no such thing as perfect and changing diagnoses and CPT codes and adding details to the notes that, supposedly, you remember from a month ago is not ok.
I did feel bad for her for leaving me. I could have gotten her off without any penalties.
You see, English is not her first language. She misinterpreted an email from the UPIC and thought it said that you can fix any errors before submitting the documents. She fabricated 17 claims before I was hired instructed her to stop. I had a solid defense prepared. I was going to hire an independent auditor to audit her 147 claims with the 17 falsified claims. I would have hoped for a low error rate. Then, I would have conducted a self-audit and self-disclosed the fabrications to the UPIC with the explanation that it was a nonintentional harmless error that we are admitting. Self-disclosure can, sometimes, save you from penalties! However, if she doesn’t self-disclose, she will be caught. Unbeknownst to her, on page 6 of the service notes, it is time and date stamped. It revealed on what day she changed the data and what data she changed. Those of you who would also terminate your attorney because you think you can get by with the fraud without anyone noticing, think hard about whether you would like to suffer the worst penalty – jail – or have your attorney be honest and upfront and get you off without penalties by following the rules and self-disclosing any problems uncovered.
I have no idea what will happen to the doctor, but had she stayed with me, she would have escaped without penalty. When not to fire your attorney!
Ding Dong! PHE Is Dead!!!
The federal Public Health Emergency (PHE) for COVID-19, declared under Section 319 of the Public Health Service (PHS) Act, is expiring at the end of the day on May 11, 2023, today! This is huge. There have been thousands of exceptions and waivers due to COVID throughout the last 2 1/2 years. But on the end of the day on May 11, 2023…POOF….
Most exceptions or waivers will immediately cease.
The Department claims it has been working closely with partners—including Governors; state, local, Tribal, and territorial agencies; industry; and advocates—to ensure an orderly transition out of the COVID PHE.
Yesterday, HHS released a Fact Sheet. It is quite extensive, as it should be considering the amount of regulatory compliance changes that will happen overnight!
Since January 2021, COVID deaths have declined by 95% and hospitalizations are down nearly 91%.
There are some flexibilities and actions that will not be affected on May 11.
Access to COVID vaccinations and certain treatments, such as Paxlovid and Lagevrio, will generally not be affected.
At the end of the PHE on May 11, Americans will continue to be able to access COVID vaccines at no cost, just as they have during the COVID PHE. People will also continue to be able to access COVID treatments just as they have during the COVID PHE.
At some point, the federal government will no longer purchase or distribute COVID vaccines and treatments, payment, coverage, and access may change.
On April 18, 2023, HHS announced the “HHS Bridge Access Program for COVID-19 Vaccines and Treatments.” to maintain broad access to vaccines and treatments for uninsured Americans after the transition to the traditional health care market. For those with most types of private insurance, COVID vaccines recommended by the Advisory Committee on Immunization Practices (ACIP) are a preventive health service and will be fully covered without a co-pay when provided by an in-network provider. Currently, COVID vaccinations are covered under Medicare Part B without cost sharing, and this will continue. Medicare Advantage plans must also cover COVID vaccinations in-network without cost sharing, and this will continue. Medicaid will continue to cover COVID vaccinations without a co-pay or cost sharing through September 30, 2024, and will generally cover ACIP-recommended vaccines for most beneficiaries thereafter.
After the transition to the traditional health care market, out-of-pocket expenses for certain treatments, such as Paxlovid and Lagevrio, may change, depending on an individual’s health care coverage, similar to costs that one may experience for other covered drugs. Medicaid programs will continue to cover COVID treatments without cost sharing through September 30, 2024. After that, coverage and cost sharing may vary by state.
Major telehealth flexibilities will not be affected. The vast majority of current Medicare telehealth flexibilities that people with Medicare—particularly those in rural areas and others who struggle to find access to care—have come to rely upon throughout the PHE, will remain in place through December 2024. Plus, States already have significant flexibility with respect to covering and paying for Medicaid services delivered via telehealth. This flexibility was available prior to the COVID PHE and will continue to be available after the COVID PHE ends.
What will be affected by the end of the COVID-19 PHE:
Many COVID PHE flexibilities and policies have already been made permanent or otherwise extended for some time, with others expiring after May 11.
Certain Medicare and Medicaid waivers and broad flexibilities for health care providers are no longer necessary and will end. During the COVID PHE, CMS used a combination of emergency authority waivers, regulations, and sub-regulatory guidance to ensure and expand access to care and to give health care providers the flexibilities needed to help keep people safe. States, hospitals, nursing homes, and others are currently operating under hundreds of these waivers that affect care delivery and payment and that are integrated into patient care and provider systems. Many of these waivers and flexibilities were necessary to expand facility capacity for the health care system and to allow the health care system to weather the heightened strain created by COVID-19; given the current state of COVID-19, this excess capacity is no longer necessary.
For Medicaid, some additional COVID PHE waivers and flexibilities will end on May 11, while others will remain in place for six months following the end of the COVID PHE. But many of the Medicaid waivers and flexibilities, including those that support home and community-based services, are available for states to continue beyond the COVID PHE, if they choose to do so. For example, States have used COVID PHE-related flexibilities to increase the number of individuals served under a waiver, expand provider qualifications, and other flexibilities. Many of these options may be extended beyond the PHE.
Coverage for COVID-19 testing will change.
State Medicaid programs must provide coverage without cost sharing for COVID testing until the last day of the first calendar quarter that begins one year after the last day of the PHE. That means with the PHE ending on May 11, 2023, this mandatory coverage will end on September 30, 2024, after which coverage may vary by state.
The requirement for private insurance companies to cover COVID tests without cost sharing, both for OTC and laboratory tests, will end at the expiration of the PHE.
Certain COVID data reporting and surveillance will change. CDC COVID data surveillance has been a cornerstone of our response, and during the PHE, HHS had the authority to require lab test reporting for COVID. At the end of the COVID-19 PHE, HHS will no longer have this express authority to require this data from labs, which will affect the reporting of negative test results and impact the ability to calculate percent positivity for COVID tests in some jurisdictions. Hospital data reporting will continue as required by the CMS conditions of participation through April 30, 2024, but reporting will be reduced from the current daily reporting to weekly.
FDA’s ability to detect shortages of critical devices related to COVID-19 will be more limited. While FDA will still maintain its authority to detect and address other potential medical product shortages, it is seeking congressional authorization to extend the requirement for device manufacturers to notify FDA of interruptions and discontinuances of critical devices outside of a PHE which will strengthen the ability of FDA to help prevent or mitigate device shortages.
Public Readiness and Emergency Preparedness (PREP) Act liability protections will be amended. On April 14, 2023, HHS Secretary Becerra mailed all the governors announcing his intention to amend the PREP Act declaration to extend certain important protections that will continue to facilitate access to convenient and timely COVID vaccines, treatments, and tests for individuals.
More changes are occurring than what I can write in one, little blogpost. Know that auditors will be knocking on your doors, asking for dates of service during the PHE. Be sure to research the policies and exceptions that were pertinent during those DOS. This is imperative for defending yourself against auditors knocking on your doors.
And, as always, lawyer-up fast!
And just like the Wicked With of the West, DING DONG! The PHE is dead.
Medicare Extrapolation Under 50% Error Rate? No Extrapolation ALLOWED!
Earlier this year, I reported on the new extrapolation rules for all audits, including RAC, UPIC, TPE, CERT, etc. You know, that alphabet soup. The biggest change was that no extrapolation may be run if the error rate is under 50%. This was an exciting and unexpected new protection for health care providers. Now I have seen it in action and want to tell you about it.
A client of mine, an internal medicine facility in Alabama, received a notice of overpayment for over $3 million. This is the first case in which I saw the 50% error rate rule in action. Normally, I always tell clients that the first two levels of appeals are rubber-stamps. In other words, don’t expect to win. The QIC and the entity that conducted the audit saying you owe money are not going to overturn themselves. However, in this case, we were “partially favorable” at the QIC level. “Partially favorable” normally means mostly unfavorable. However, the partially favorable decision took the error rate from over 50% to under 50%. We re-grouped. Obviously, we were going to appeal because the new extrapolation was still over $1 million. However, before our ALJ hearing, we received correspondence from Palmetto that said our overpayment was $0. Confused, we wrote to the ALJ pointing out that Palmetto said our balance was zero. The Judge wrote back saying that, certainly, the money has already been recouped and the practice would get a refund if he reversed the denials.” “Ok,” we said and attended a telephonic hearing. We were unsuccessful at the hearing, and the ALJ upheld an alleged overpayment of over $1 million. We argued that the extrapolation should be thrown out due to the error rate being under 50%. The Judge still ruled against us, saying that CMS has the right to extrapolate, and the courts have upheld CMS’ ability to extrapolate. Ok, but what about the NEW RULE?
Later, we contacted Palmetto to confirm what the zero-balance meant. The letter read as if we did not owe anything, yet we had an ALJ decision mandating us to pay over a $1million. There was serious juxtaposition. After many hours of chasing answers on hold with multiple telephone answerers of Palmetto, we learned that, apparently, because the error rate dropped below 50% after the QIC level, Palmetto “wrote off” the nominal balance. Since an extrapolation was no longer allowed, the miniscule amount that Palmetto thought we owed wasn’t enough to pursue. However, the letter sent to us from Palmetto did not explain, “hey, we are writing off your overpayment because the error rate fell below 50%.” No, it was vague. We didn’t even know if it were true.
It took us reaching out to Palmetto and getting an email confirmation that Palmetto had written off the alleged overpayment due to the error rate dropping. Even the ALJ misinterpreted the letter, which tells me that Palmetto should revise its notices of write offs.
If Palmetto unilaterally dismisses or writes off any balance that is allegedly owed, the letter should explicitly explain this. Because providers and attorneys are not accustomed to receiving correspondence from a MAC, CMS, Palmetto, or any other auditing entity with GOOD NEWS. If we get GOOD NEWS from an auditing entity, that correspondence should be explicit.
Regardless, this was a huge win for me and my client, who was positively ecstatic with the outcome. Tune in next week, during which I will tell a story of how we battled successfully a qui tam action against a facility of 9 specialists due to a disgruntled employee who tried to blow the whistle on my specialists and their facility…falsely!
Preparing for Post-PHE Medicare and Medicaid Audits
Hello and happy RACMonitor Monday! As the nation forges ahead in the wake of the COVID-19 pandemic, the audits continue after that brief hiatus in March 2020. Recovery Audit Contractors (RACs), UPICs, and other auditors are dutifully reviewing claims on a post-payment basis. However, since COVID, there is a staffing shortage, which have many provider facilities scrambling on a normal basis. Throw in an audit of 150 claims and you’ve got serious souff-laying.
Yes, audit preparation has changed since COVID. Now you have more to do to prepare. Audits create more work when you have less staff. Well, suck it up sippy-cup because post-PHE audits are here.
The most important pre-audit preparation is knowing the COVID exceptions germane to your health care services. During PHE over the last two years, there has been a firehose of regulatory exceptions. You need to use these exceptions to your advantage because, let’s face it, the exceptions made regulatory compliance easier. For the period of time during which the exceptions applied, you didn’t have to get some signatures, meet face-to-face, have supervision, or what not. The dates during which these exceptions apply is also pertinent. I suggest creating a folder for all the COVID exceptions that apply to your facility. While I would like to assume that whatever lawyer that you hire, because, yes, you need to hire a lawyer, would know all the COVID exceptions – or, at least, know to research them, you never know. It only benefits you to be prepared.
Any medical provider that submits claims to a government program may be subject to a Medicare or Medicaid audit. Just because you have been audited in the past, doesn’t change the fact that you may be audited again in the future. RAC audits are not one-time or intermittent reviews and can be triggered by anything from an innocent documentation error to outright fraud. I get that questions a lot: This is my 3rd audit. At what point is this harassment. I’ve never researched the answer to that question, but I would venture that auditors get tons of latitude. So, don’t be that provider that is low-hanging fruit and simply pays post-payment reviews.
While reduced staff, high patient loads or other challenges may be bogging down your team, it’s important to remember that timeliness is crucial for CMS audit responses.
Locating the corresponding medical records and information can be a hassle at the best of times, but there are a few key things your organization can do to better prepare for a RAC Audit:
According to CMS, if selected for review, providers should discuss with their contractor any COVID-19-related hardships they are experiencing that could affect audit response timeliness. CMS notes that all reviews will be conducted in accordance with statutory and regulatory provisions, as well as related billing and coding requirements. Waivers and flexibilities will also be applied if they were in place on the dates of service for any claims potentially selected for review.
Ensure that the auditor has the appropriate contact information for requesting audit-related documentation. With so many changes to hospitals teams, it’s important to make sure that auditors’ requests for medical records are actually making it to the correct person or team in a timely manner.
Provide your internal audit review teams with proper access to data and other software tools like those used to ensure timely electronic audit responses. With a mix of teams working from home and in the office, it’s a good idea to make sure that teams handling Additional Documentation Requests (ADRs) and audit responses have the necessary access to the data they will need to respond to requests.
Review and document any changes to your audit review team processes.
Meet with your teams to ensure they fully understand the processes and are poised to respond within the required timeframes.
Successfully completing these audits in a timely manner is made much easier when the above processes and steps are in place.
PRF Audits: If You Did Not Report or Use Properly, You May Have a Recoupment!
Hello, my blog readers. Over the last two weeks, I have joined Nelson Mullins in the Raleigh office, attended Nelson Mullins’ healthcare retreat in Charlotte, and attended the Long Term and Post-Acute Care Law and Compliance conference in New Orleans, LA. It has been quite a whirlwind! I also appeared on RACMonitor, as I do every Monitor Monday.
Joining Nelson Mullins has been fantastic. There is a deep bench of health care attorneys, so now I am able to offer my clients all legal services they may need.
Today I am writing about provider relief funds (“PRF”) audits because, folks, PRF audits are HERE. If providers failed to report their PRF or used the funds for non-allowable items having nothing to do with COVID, HHS and OIG may recoup the funds.
An allowable expense under the PRF must be used to prevent, prepare for, and respond to coronavirus. PRF recipients must follow their basis of accounting (e.g., cash, accrual, or modified accrual) to determine expenses. The cited expenses, as well as losses, must not have been reimbursed from other sources and other sources must not be obligated to reimburse them.
Many providers were recipients of provider relief funds or PRF during the COVID pandemic. If providers received these funds there were reporting requirements and use requirements. Now audits are being conducted to ensure the funds’ proper use and reporting. Audits are being rolled out on two different fronts: (1) HHS; and (2) HRSA – or Health Resources Services Administration.
On Feb. 25, 2022, the American Institute of Certified Public Accountants’ (AICPA) Government Audit Quality Center (GAQC) provided long-awaited guidance to for-profit healthcare organizations that are subject to the Provider Relief Fund (PRF) audit requirements. The guidance came in the form of a practice aid entitled HHS Audit Requirements for For-Profit Entities with Awards from the Provider Relief Fund Program and Other HHS Programs. Its goal is to provide clarity to for-profit healthcare entities that expend $750,000 or more in federal awards in a given reporting period, which includes the PRF and other federal awards included in the Assistance Listing but excludes Paycheck Protection Program funds. Based on the practice aid, here is a summary of audit options available to for-profit entities to meet the audit compliance requirements of the U.S. DHHS.
- Uniform Guidance Audits
- Single Audit – A single audit requires an audit of both the financial statements under Generally Accepted Government Auditing Standards (GAGAS) and a compliance audit under Uniform Guidance. The compliance audit requires testing compliance with any major program(s) as defined by Uniform Guidance as well as obtaining an understanding of internal control over compliance and testing the internal control over compliance for each major program identified. The results are two auditor’s reports: one on the financial statements and one on compliance and internal controls over compliance. This option is necessary if federal regulations require a financial statement audit. This option is available to entities with funding from multiple programs from any federal agency.
- Program-Specific Audit – The program-specific audit is similar to the single audit except that it removes the financial statement audit requirement. Therefore, tests of compliance, an understanding of internal control over compliance, and testing internal control over compliance are required for this engagement. A schedule of a specific element of a financial statement would be prepared. The results are two auditor’s reports: one on the schedule of a specific element of a financial statement (the PRF funding) and one on compliance and internal controls over compliance. This option is only available if the entity has funding under one HHS program, such as the PRF.
- Financial-Related Audit Under GAGAS – A financial-related audit under GAGAS requires an audit to be conducted on only one schedule of a specific element of the financial statements. This option is only available if all federal funds expended during the period were from HHS programs. The schedule (the HHS Schedule) would include all federal awards from HHS, including the PRF. It does not require an audit of the financial statements or any testing of internal controls over compliance. It does require compliance testing, but no opinion on compliance is issued. The result is an auditor’s report only on the HHS Schedule.
There are 4 reporting periods per year that will be audited. Reporting for the 2023 4th period is going on now. Providers who received a PRF (General or Targeted) exceeding $10,000 in the aggregate, from July 1, 2021, to December 31, 2021, are required to report on their use of funds during RP4. The deadline to submit a report is March 31, 2023.
There is an appeal process if you receive a Final Repayment Notice. Once you receive a Final Repayment Notice, you have 60 days to either pay or appeal.
- Providers who do not take one of these actions within 60 days of HRSA’s Final Repayment Notice may be referred by HRSA to the HHS Program Support Center (PSC) for the initiation of debt collection activities.
- PSC, in coordination with the U.S. Department of Treasury, will issue formal debt collection letters to all providers that HRSA refers for debt collection. At this point, PSC and Treasury will take over all debt collection communications with referred providers. Debt collection activities may include accrual of interest, penalties, and recovery of funds by offsetting other Federal payments allocated to the entity.
HRSA cannot establish payment plans for outstanding debts. Once the repayment amount has been referred to PSC and becomes official debt, providers can apply for repayment plans directly with PSC.
Family Practice Doctors: Is It CPT 1995 or 1997 Guidance?
Right now, CMS allows physicians to pick to follow the 1995 or 1997 guidelines for determining whether an evaluation and management (“e/m”) visit qualifies for a 99214 versus a 99213. The biggest difference between the two policies is that the 1995 guideline allows you to check by systems, rather than individual organs. Starting January 1, 2023, there are a lot of revisions, including a 2021 guidance that will be used. But, for dates of service before 2021, physicians can pick between 1995 and 1997 guidance.
Why is this an issue?
If you are a family practitioner and get audited by Medicare, Medicaid, or private pay, you better be sure that your auditor audits with the right policy.
According to CPT, 99214 is indicated for an “office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a detailed history, a detailed examination and medical decision making of moderate complexity.”
Think 99214 in any of the following situations:
- If the patient has a new complaint with a potential for significant morbidity if untreated or misdiagnosed,
- If the patient has three or more old problems,
- If the patient has a new problem that requires a prescription,
- If the patient has three stable problems that require medication refills, or one stable problem and one inadequately controlled problem that requires medication refills or adjustments.
The above is simplified and shorthand, so read the 1995 and 1997 guidance carefully.
An insurance company audited a client of mine and clearly used the 1997 guidance. On the audit report, the 1997 guidance was checked as being used. In fact, according to the audit report, the auditors used BOTH the 1997 and 1995 guidance, which, logically, would make a harder, more stringent standard for a 99214 than using one policy.
Now the insurance company claims my client owes money. However, if the insurance company merely applied the 1995 guidance only, then, we believe, that he wouldn’t owe a dime. Now he has to hire me, defend himself to the insurance company, and possibly litigate if the insurance company stands its ground.
Sadly, the above story is not an anomaly. I see auditors misapply policies by using the wrong years all the time, almost daily. Always appeal. Never roll over.
Sometimes it is a smart decision to hire an independent expert to verify that the physician is right, and the auditors are wrong. If the audit is extrapolated, then it is wise to hire an expert statistician. See blog. And blog. The extrapolation rules were recently revised…well, in the last two or three years, so be sure you know the rules, as well. See blog.
Medicare Auditors Fail to Follow the Jimmo Settlement
Auditors are not lawyers. Some auditors do not even possess the clinical background of the services they are auditing. In this blog, I am concentrating on the lack of legal licenses. Because the standards to which auditors need to hold providers to are not only found in the Medicare Provider Manuals, regulations, NCDs and LCDs. Oh, no… To add even more spice to the spice cabinet, common law court cases also create and amend Medicare and Medicaid policies.
For example, the Jimmo v. Selebius settlement agreement dictates the standards for skilled nursing and skilled therapy in skilled nursing facilities, home health, and outpatient therapy settings and importantly holds that coverage does not turn on the presence or absence of a beneficiary’s potential for improvement.
The Jimmo settlement dictates that:
“Specifically, in accordance with the settlement agreement, the manual revisions clarify that coverage of skilled nursing and skilled therapy services in the skilled nursing facility (SNF), home health (HH), and outpatient therapy (OPT) settings “…does not turn on the presence or absence of a beneficiary’s potential for improvement, but rather on the beneficiary’s need for skilled care.” Skilled care may be necessary to improve a patient’s current condition, to maintain the patient’s current condition, or to prevent or slow further deterioration of the patient’s condition.”
This Jimmo standard – not requiring a potential for improvement – is essential for diseases that are lifelong and debilitating, like Multiple Sclerosis (“MS”). For beneficiaries suffering from MS, skilled therapy is essential to prevent regression.
I have reviewed numerous audits by UPICs, in particular, which have failed to follow the Jimmo settlement standard and denied 100% of my provider-client’s claims. 100%. All for failure to demonstrate potential for improvement for MS patients. It’s ludicrous until you stop and remember that auditors are not lawyers. This Jimmo standard is found in a settlement agreement from January 2013. While we will win on appeal, it costs providers money valuable money when auditors apply the wrong standards.
The amounts in controversy are generally high due to extrapolations, which is when the UPIC samples a low number of claims, determines an error rate and extrapolates that error rate across the universe. When the error rate is falsely 100%, the extrapolation tends to be high.
While an expectation of improvement could be a reasonable criterion to consider when evaluating, for example, a claim in which the goal of treatment is restoring a prior capability, Medicare policy has long recognized that there may also be specific instances where no improvement is expected but skilled care is, nevertheless, required in order to prevent or slow deterioration and maintain a beneficiary at the maximum practicable level of function. For example, in the regulations at 42 CFR 409.32(c), the level of care criteria for SNF coverage specify that the “. . . restoration potential of a patient is not the deciding factor in determining whether skilled services are needed. Even if full recovery or medical improvement is not possible, a patient may need skilled services to prevent further deterioration or preserve current capabilities.” The auditors should understand this and be trained on the proper standards. The Medicare statute and regulations have never supported the imposition of an “Improvement Standard” rule-of-thumb in determining whether skilled care is required to prevent or slow deterioration in a patient’s condition.
When you are audited by an auditor whether it be a RAC, MAC or UPIC, make sure the auditors are applying the correct standards. Remember, the auditors aren’t attorneys or doctors.
Celebrating Christmas With an Audit, I mean, a Root Canal
Merry Christmas and Happy Hanukkah! I wanted to thank all my readers for TEN YEARS of this blog! Can you believe it has been 10 years? I started this blog in 2012, and the year is about to turn to 2023!! I going into my 11th year of blogging about Medicare and Medicaid regulatory compliance litigation. Whew! I tell you what: being a full-time attorney, a part-time blogger, mom, and wife is tiring! Try it. You’ll see. Try it for 10 years!
I am so proud to have created a career out of defending health care providers across the country, from HI to AL to NY to FL and everywhere in between.
My birthday is January 7th, right after Christmas and New Year’s Day. I am one year closer to getting Medicare (I cannot wait), but since I rely on private pay health insurance, I am giving myself a special Christmas present to end the year and “wind-down” the health spending plan. I will be undergoing a root canal tomorrow, the 21st of December.
Root canals are not fun. In fact, they remind me of undergoing a Medicare and/or Medicaid audit. No one wants them done, but you got to do it.
I suggest conducting self audits regularly, especially now with the Public Health Emergency (PHE) ending at some point.
Self Audits
The first step for a medical practice or organization is to select the timeframe that will be reviewed during the audit. The timeframe should be large enough to produce meaningful results. For example, in its OIG Data Brief, the OIG looked at a year’s worth of data, from March 1, 2020, through February 28, 2021. There are some key dates and regulations that practices or organizations need to consider when selecting the timeframe. These include:
- January 31, 2020: HHS announced the COVID-19 PHE, which was determined to have existed since January 27, 2020.
- March 27, 2020: The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law.
- March 31, 2020: CMS’ “Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency” became effective.
So many changes to Medicare and Medicaid rules and regulations were implemented during COVID. Some changes will continue after PHE ends and some will not.
Now more so than ever, putting your own facility through a thorough self-audit is imperative. You need to understand the policy changes pertinent to your health care service type and dates the changes occurred and when applicable. Before the “REAL” auditors come knocking on your facility’s door, prepare yourself. Consider hiring an attorney or medical compliance expert to conduct the self audit.
The next step in performing a self-audit is for the practice or organization to select a category of service to review. If the practice or organization provides multiple types of services, the focus should be on one category, such as office visits, for review. When reviewing office visit services, the Current Procedural Terminology (CPT) codes applicable to telehealth visits include, but are not limited to, Office or Other Outpatient Services (99201-99205 [new patient] and 99211-99215 [established patient]) and Non-Face-to-Face Telephone Services (99441-99443 [practitioners who may report E/M services] and 98966-98968 [practitioners who cannot bill independently]). Practitioners who cannot bill independently are qualified non-physician health care professionals, such as social workers, clinical psychologists, and certain therapists. Please note, CPT code 99201 was deleted effective January 1, 2021.
Looking forward to 2023 after my root canal…Cheers!
CMS: Broaden the Definition of “Medically Necessary” Germane to Dental Services!
Dental services do not, historically, “gel-well” with Medicare and Medicaid. In fact, most dentists do not accept Medicare and Medicaid, and, quite frankly, I do not blame them. Accepting Medicare and/or Medicaid comes with accepting the fact that your dental practice can – and will – be audited by CMS or your State government at-will, at any time, for any reason. Your dental practice can be raided at any time by any federal agency, including the FBI, DOJ, OIG, alleging civil and criminal violations when you, as a dentist, had no clue that your medical records could be used against you, if not up to snuff…according to the governmental auditor. Perhaps more dentists would accept Medicare and/or Medicaid patients if the definition of “medically necessary” is broadened. More incentive to accept government programs is always good.
Dental benefits are covered by Medicare only in limited circumstances, and many people on Medicare do not have any dental coverage at all unless they pay for a Medicare Advantage (“MA”) plan. However, Medicare and Medicaid could cover more dental services if Congress or CMS broadens the definition of “medical necessity.” But, even with MA, the scope of dental benefits, when covered, varies widely and is often quite limited, which can result in high out-of-pocket costs among those with expensive dental needs.
Medicare and/or Medicaid will determine whether a dental service is essential – or “medically necessary” – for a beneficiary’s exasperating, primary medical condition. Congress has fallen short on expanding the legal definition of “medical necessary” regarding dental services for Medicare and Medicaid recipients.
In a June 29, 2022, letter to CMS Administrator Chiquita Brooks-LaSure, more than 100 members of the U.S. House of Representatives pled with CMS to expand its definition of “medically necessary” dental care. Lawmakers highlighted the serious issues stemming from the lack of access to affordable dental care. I do not know if you recall, but, in 2013-ish, I blogged about a young, African American boy, named Deamonte, who died in the emergency room from an abscessed tooth that ruptured, when that abscessed tooth could have been remedied by a dentist for a few hundred dollars. See blog.
Nearly half of Medicare beneficiaries (47%), or 24 million people, do not have dental coverage, as of 2019.
Almost half of all Medicare beneficiaries did not have a dental visit within the past year (47%), with higher rates among those who are Black (68%) or Hispanic (61%), have low incomes (73%), or who are in fair or poor health (63%), as of 2018.
In 2021, 94% of Medicare Advantage enrollees in individual plans (plans open for general enrollment), or 16.6 million enrollees, are in a plan that offers access to some dental coverage.
To those dentists or dental surgeons who do accept Medicare and/or Medicaid – THANK YOU!
Medicare and/or Medicaid audits for dental services, while not fun to deal with, are easily defensible…most of the time. A few years ago Medicaid sought to recoup money from dentists who provided services to women believed to be pregnant when the pregnancy was over. See blog. I thought it was absolutely ridiculous that your dentist has the burden to ensure a woman is or is not pregnant. I feel as though many dentists could be slapped by asking. Plus, the services were rendered, so a dentist should not have to pay to provide services.
District Court Upholds ALJ’s Decision that Extrapolation Was Conducted in Error
Today, I am going to write about a hospital in Tennessee that underwent an audit, and the MAC determined that the hospital owed over $5 million. The hospital challenged both the OIG contractor’s sampling methodology and its determinations on specific claims by requesting a hearing before an ALJ. The District Court decision was published in September 2022. The reason that I want to make you aware of this case, is because there have been numerous Medicare provider appeals unsuccessfully challenging the extrapolation, and the ALJs upholding the extrapolations. In this case, the ALJ found the extrapolation in error, the Council reversed the ALJ on its own motion, and the district court reaffirmed the ALJ, saying the extrapolation was faulty. Whenever good case law is published, we want to analyze the Court’s reasoning so we, as attorneys, can replicate the winning arguments.
One of the main reasons that the district court agreed that the extrapolation was faulty was because no testimony supporting the OIG contractor’s extrapolation process or the implementation of its statistical sampling methodology were submitted to that hearing on June 11, 2020, and the contractor did not appear. It’s the mundane scene with an ALJ level appeal and the auditor failing to appear to prove the audit’s veracity. See blog.
In addition to finding that additional claims satisfied Medicare coverage & payment requirements, the ALJ also found that OIG’s statistical extrapolation process did not comply with § 1893 of the Social Security Act, nor with the MPIM’s guidance on statistical extrapolation.
The ALJ held that HHS policy requires that the OIG’s audit must be able to be recreated and that as the audit’s sampling frame utilized data from outside of the audit, the audit could not be recreated.
The Council subsequently reviewed the ALJ’s decision on its own motion and reversed that decision in part, finding that the ALJ’s determination that the sampling process was invalid was an error of law. The Council then concluded that the OIG contractor’s statistical extrapolation met all applicable Medicare legal and regulatory requirements.
The hospital appealed to the federal district court. The district court’s review consists of determining whether, in light of the record as a whole, the Secretary’s determination is supported by “substantial evidence.”
According to the Court, the hospital amply demonstrated that the Council did not have the authority to overturn the decision of the ALJ on own-motion review. Accordingly, the hospital’s Motion for Summary Judgement was GRANTED and the extrapolation was thrown out.
