Category Archives: Due process
If you are accused of Medicare fraud, your Medicare reimbursements will be immediately cut off without any due process or ability to defend yourself against the allegations. If you accept Medicare and Medicaid then you are held to strict regulations, some of which are highly, Draconian in nature without much recourse, legally, for providers. Many, many a provider have gone bankrupt and been forced out of business due to “credible allegations of fraud.” You see, legally, “credible allegations of fraud” is a low standard to meet. The definition of “credible” is “an indicia of reliability.” “Indicia” is defined as “signs, indications, circumstances which tend to show or indicate that something is probable. It is used in the form of “indicia of title,” or “indicia of partnership,” particularly when the “signs” are items like letters, certificates, or other things that one would not have unless the facts were as the possessor claimed. It can be a disgruntled worker. I am sure that none of the listeners here today have ever dealt with a disgruntled employee. Yes, that is sarcasm.
42 CFR § 405.372 is the regulation outlining the requirements for suspending Medicare payments. 42 CFR § 455.23 is the regulation mandating suspension of Medicaid payments upon credible allegations of fraud.
Pursuant to Medicare regulations, CMS must suspend Medicare reimbursements to a healthcare provider “in whole or in part” if it has been “determined that a credible allegation of fraud exists against a provider or supplier.” 42 C.F.R. § 405.371(a)(2). A credible allegation of fraud is “an allegation from any source, including … civil fraud claims cases, and law enforcement investigations.” 42 C.F.R. § 405.370(a). The decision to suspend Medicare payment or continue a payment suspension is made at the discretion of CMS – not the MAC. If you receive a letter from a MAC alleging fraud, be sure to check whether the letter states that the decision was made in collaboration with CMS. The MACs do not have the authority.
The suspension, however, is not indefinite, although the length is normally a year, which is financially devastating. The regulations allow CMS to maintain the suspension until a “legal action is terminated by settlement, judgment, or dismissal, or when the case is closed or dropped because of insufficient evidence to support allegations of fraud.” 42 C.F.R. §§ 405.370(a) and .372(d)(3); see also § 405.371(b)(3)(ii) (CMS may extend the suspension of payment if the Department of Justice submits a written request that “suspension of payments be continued based on the ongoing investigation and anticipated filing of criminal or civil action or both or based on a pending criminal or civil action or both.”).
When you receive a fraud accusation of any type – it is imperative to send it to your counsel. If you opt to litigate the suspension by asking the Court to enjoin the suspension, your first legal obstacle will be to argue that you do not have to exhaust your administrative remedies before appearing for the injunction. Cases have been decided both in the favor of providers and their suspensions have been lifted and against the providers. These cases usually win or lose on the argument that the suspension of reimbursements is an ancillary subject from the actual investigation of fraud. It is a jurisdictional argument.
It is my opinion that the federal regulations that allow for suspension of payments upon credible allegations of fraud need to be revised. Any of you with lobbyists, we need to revise the regulations to require due process – notice and an opportunity to be heard – prior to the government suspending Medicare and Medicaid reimbursements based on a spurious accusation from an anonymous source.
Back in 2015, I am sure that you all recall the case in New Mexico where NM accused 15 BH care provider of credible allegations of fraud. The providers constituted 87.5% of the BH in NM. I was one of the attorneys representing the larger BH cos. Prior to my involvement, all 15 providers requested good cause. All were denied. Lawmakers think that the good cause exception written into the regulation is enough defense for providers. But when the good cause is almost always denied, it isn’t much help. Write to your congress people. Amend the regulations to require due process.
Let’s talk targeted probe-and-educate (TPE) audits. See on RACMonitor as well.
TPE audits have turned out to be “wolf audits” in sheep’s clothing. The Centers for Medicare & Medicaid Services (CMS) asserted that the intent of TPE audits is to reduce provider burden and appeals by combining medical review with provider education.
But the “education” portion is getting overlooked. Instead, the Medicare Administrative Contractors (MACs) resort to referring healthcare providers to other agencies or contractors for “other possible action,” including audit by a Recovery Audit Contractor (RAC), which can include extrapolation or referral to the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) for investigation of fraud. A TPE audit involves up to three rounds of review, conducted by a MAC. Once Congress was instructed that RAC audits are not fair, and providers complained that RAC auditors did not help with education, CMS came up with TPE audits – which, supposedly, had more of an educational aspect, and a more fair approach. But in reality, the TPE audits have created an expensive, burdensome, cyclical pattern that, again, can result in RAC audits. The implementation of TPE audits has been just as draconian and subjective as RAC audits. The penalties can be actually worse than those resulting from RAC audits, including termination from the Medicare program. In this article, I want to discuss the appeal process and why it is important to appeal at the first level of audit.
Chapter Three, Section 3.2.5 of the Medicare Program Integrity Manual (MPIM) outlines the requirements for the TPE process, which leaves much of the details within the discretion of the MAC conducting the review. The MACs are afforded too much discretion. Often, they make erroneous decisions, but providers are not pushing back. A recent one-time notification transmittal provides additional instructions to MACs on the TPE process: CMS Transmittal 2239 (Jan. 24, 2019).
Providers are selected for TPE audit based on data analysis, with CMS instructing MACs to target providers with high denial rates or claim activity that the contractor deems unusual, in comparison to peers. These audits are generally performed as a prepayment review of claims for a specific item or service, though relevant CMS instructions also allow for post-payment TPE audits.
A TPE round typically involves a review of a probe sample of between 20 and 40 claims. Providers first receive notice that they have been targeted by their MAC, followed by additional documentation requests (ADRs) for the specific claims included in the audit.
The MACs have sole discretion as to which providers to target, whether claims meet coverage requirements, what error rate is considered compliant, and when a provider should be removed from TPE. Health care providers can be exposed to future audits and penalties based merely on the MAC’s resolve, and before the provider has received due process through their right to challenge claim denials in an independent appeals process. In this way, the MACs’ misinterpretation of the rules and misapplication of coverage requirements can lead to further audits or disciplinary actions, based on an erroneous determination that is later overturned. Similarly, while the educational activities are supposedly meant to assist providers in achieving compliance, in reality, this “education” can force providers to appear to acknowledge error findings with which they may disagree – and which may ultimately be determined to be wrong. Often times, the MACs – for “educational purposes” – require the provider to sign documentation that admits alleged wrongdoing, and the provider signs these documents without legal counsel, and without the understanding that these documents can adversely affect any appeal or future audits.
The MACs have the power, based on CMS directive, to revoke billing privileges based on a determination that “the provider or supplier has a pattern or practice of submitting claims that fail to meet Medicare requirements.” 42 C.F.R. § 424.535(a)(8)(ii). This language shows that TPE audit findings can be used as a basis for a finding of abuse of billing privileges, warranting removal from participation in the Medicare program. CMS guidance also gives the MACs authority to refer providers for potential fraud investigation, based on TPE review findings. It is therefore vital that providers submit documentation in a timely fashion and build a clear record to support their claims and compliance with Medicare requirements.
TPE audits promise further education and training for an unsuccessful audit (unsuccessful according to the MAC, which may constitute a flawed opinion), but most of the training is broad in nature and offered remotely – either over the phone, via web conference, or through the mail, with documentation shared on Google Docs. Only on atypical occasions is there an on-site visit.
Why appeal? It’s expensive, tedious, time-consuming, and emotionally draining. Not only that, but many providers are complaining that the MACs inform them that the TPE audit results are not appealable (TPE audits ARE appealable).
TPE reviews and TPE audit overpayment determinations may be appealed through the Medicare appeals process. The first stage of appeal will be to request a redetermination of the overpayment by the MAC. If the redetermination decision is unfavorable, Medicare providers and suppliers may request an independent review by filing a request for reconsideration with the applicable Qualified Independent Contractor (QIC). If the reconsideration decision is unfavorable, Medicare providers and suppliers are granted the opportunity to present their case in a hearing before an administrative law judge (ALJ). While providers or suppliers who disagree with an ALJ decision may appeal to the Medicare Appeals Council and then seek judicial review in federal district court, it is crucial to obtain experienced healthcare counsel to overturn the overpayment determination during the first three levels of review.
Appealing unfavorable TPE audits results sends a message. Right now, the MACs hold the metaphoric conch shell. The Medicare appeals process allows the provider or supplier to overturn the TPE audit overpayment, and reduces the likelihood of future TPE reviews, other Medicare audits, and disciplinary actions such as suspension of Medicare payments, revocation of Medicare billing privileges, or exclusion from the Medicare program. In instances when a TPE audit identifies potential civil or criminal fraud, it is essential that the Medicare provider or supplier engage experienced healthcare counsel to appeal the Medicare overpayment as the first step in defending its billing practices, and thus mitigating the likelihood of fraud allegations (e.g., False Claims Act actions).
CMS and the MACs maintain that TPEs are in the providers’ best interest because education is included. In actuality, TPEs are wolves in sheep’s clothing, masking true repercussions in a cloak of “education.” The Medicare appeal process is a provider’s best weapon.
“Gov. Michelle Lujan Grisham signed into law this week a bill (SB41) that ensures service providers accused of overbilling or defrauding Medicaid can review and respond to allegations of wrongdoing before state action is taken.” – Tripp Jennings, New Mexico In Depth.
For those of you who don’t know, in 2013, the State of New Mexico, suspended the Medicaid reimbursements of 15 behavioral health care providers based on “credible allegations of fraud.” 42 CFR 455.23. The Attorney General eventually determined that no fraud existed as to ANY of the 15 behavioral health care providers. These providers constituted 87.5% of the behavioral health care providers in New Mexico, which is predominantly Medicaid and has the highest suicide rate of any state, if you consider the Native American population.
There was no due process. The providers were informed of the immediate Medicaid suspension in a group meeting without ever being told what exactly the “fraud” was that they allegedly committed. They were informed by, then assistant Attorney General, Larry Hyeck, that fraud existed and because of the ongoing investigation nothing could be divulged to those accused. Supposedly, the evidence for such “fraud” was based on an independent audit performed by Public Consulting Group (PCG). However, according to testimony from an employee of PCG at the administrative hearing of The Counseling Center (one of the 15 accused behavioral health care providers), PCG was not allowed by the Human Services Department of NM (HSD) to complete its audit. According to this employee’s testimony, it is PCG’s common practice to return to the providers which are the subject of the audit a 2nd or even 3rd time to ensure that all the relevant documents were collected and reviewed. Human error and the sheer amount of medical records involved in behavioral health care suggest that a piece of paper or two can be overlooked, especially because this audit occurred in 2013, before most of the providers had adopted electronic medical record systems. Add in the fact that PCG’s scanners were less than stellar and that the former Governor Susan Martinez, Optum’s CEO, and the HSD Secretary -at the time- had already vetted 5 Arizona companies to overtake the 15 NM behavioral health care companies – even prior to PCG’s determination – and the sum equals a pre-determined accusation of fraud. PCG’s initial report stated that no credible allegations of fraud existed. However, PCG was instructed to remove that sentence.
Almost all the providers were forced out of business. The staff were terminated or told to be employed by the new 5 AZ companies. The Medicaid recipients lost their mental health services. One company remained in business because they paid the State for fraud that they never committed. Another company held on by a very thin thread because of its developmental disability services. But the former-CEO became taxed and stepped down and many more left or were let go. The 13 other providers were financially ruined, including the largest behavioral health care provider in NM, which serviced over 700 Medicaid recipients and employed hundreds of clinical staff. It had been servicing NM’s poor and those in need of mental health services for over 30 years. Another company had been in business over 40 years (with the same CEO). The careers and live’s work were crumbled in one day and by one accusation that was eventually proven to be wrong.
No one ever foresaw this amount of abuse of discretion to occur by government agents.
Now, today, in 2019, the new Governor of NM, Gov. Michelle Lujan Grisham, signed a law introduced by Senator Mary Kay Papen, a long proponent and advocate that the 15 behavioral health care providers were unjustly accused and forced out of business, that will protect Medicaid providers in NM from ever being subjected to the unjust and arbitrary suspension of Medicaid funds and unfounded allegations of Medicaid fraud.
Even though 42 C.F.R. 455.23 requires a state to suspend Medicaid funding upon “credible allegations of fraud,” NM has taken the first step toward instituting a safeguard for Medicaid providers. Already too few health care providers accept Medicaid – and who can blame them? The low reimbursement rates are nothing compared to the regulatory scrutiny that they undergo merely for accepting Medicaid.
NM SB41 contradicts the harsh language of 42 CFR 455.23, which mandates that a State “must” suspend payments upon a credible allegation of fraud. NM SB41 provides due process for Medicaid providers accused of fraud. Which begs the question – why hasn’t anyone brought a declaratory action to determine that 42 CFR 455.23 violates due process, which happens to be a constitutional right?
Part of the due process enacted by New Mexico is that a suspension of Medicaid reimbursements should be released upon a post of a surety bond and that the posting of a surety bond shall be deemed good cause to not suspend payments during the investigation. Although the new law also states that the Medicaid reimbursement suspension must be released within 10 days of the posting of the surety bond “in the amount of the suspended payment.” After 4 administrative hearings in New Mexico, I can assure you that the provider and HSD will have two disparate views of the “amount of the suspended payment.” And by disparate, I mean REALLY disparate.
Regardless, I view this new law as a giant leap in the direction of the Constitution, which was actually enacted in 1789. So is it apropos that 230 years later NM is forced to enact a law that upholds a legal right that was written and enacted into law 230 years ago?
Thank you, Gov. Michelle Lujan Grisham, Senator Papen, Patsy Romero, and Shawn Mathis for your amazing effort on getting this legislation passed.
And – look forward to my webcast on RACMonitor on Monday, April 8, 2019, detailing how courts across the country are revising their views and granting federal injunctions stopping premature recoupments when a Medicare/caid provider is accused of an overpayment. Due process is on a come-back.
New case law supports due process for Medicare providers. As first seen on RACMonitor.
Due process is one of the cornerstones of our society. Due process is the universal guarantee and found in the Fifth Amendment to the United States Constitution, which provides “No person shall…be deprived of life, liberty, or property, without due process of law,” and is applied to all states by the 14th Amendment. From this basic principle flows many legal decisions determining both procedural and substantive rights.
For Medicare and Medicaid providers, however, due process, in the past, has been nonexistent. Imagine that you are accused of owing $5 million to the government. Perhaps it was a CPT® code error. You disagree. You believe that your documentation was proper and that you filed for reimbursement correctly. You appeal the decision that you owe $5 million. You continue conducting business as normal. Suddenly, you realize the government is recouping the $5 million now. Prior to any hearing before a judge. You haven’t been found guilty. What happened to innocent until proven guilty? What happened to due process?
For Medicare appeals there is a five-step appeal process. The law requires the government not to recoup during the first and second levels of appeal. But the first and second levels are jumping through hoops and are not normally successful. It is at the third level – the appeal to an impartial administrative judge – that the alleged recoupments are overturned.
After the second level, according to the black letter of the law, the government can begin recouping the alleged overpayment.
Sadly, in the past, the courts have held that it is proper for the government to recoup reimbursements after the second level. Even though, no hearing has been held before an impartial judge and you haven’t been found guilty of owing the money.
On Sept. 27, 2018, another U.S. District Court in South Carolina has agreed with courts in Texas by granting a provider’s request for a Temporary Restraining Order (TRO) to prevent the Centers for Medicare and Medicaid Services (CMS) from recouping monies until after Administrative Law Judge (ALJ) hearings have been held (Accident, Injury and Rehabilitation, PC, c/a No. 4:18-cv-02173, September 27, 2018).
A new trend in favor of providers seems to be arising. This is fantastic news for providers across the country!
Accident, Injury & Rehab, PC found that the ALJ stage of the appellate process is the most important for providers, as it provides the first opportunity for plaintiff to cross examine defendant’s witnesses and examine the evidence used to formulate the statistical sample. According to the American Hospital Association (AHA), 66 percent of Recovery Audit Contractor (RAC) denials are reversed by an ALJ (I actually believe the percentage is higher). The court found that plaintiff’s procedural due process rights were violated by premature recoupment. The court granted Accident, Injury & Rehab, PC’s preliminary injunction restraining and enjoining the government from withholding Medicare payments during the appeal process.
When the government starts recouping filing a preliminary injunction has been shown it to be the best course.
In the past, most preliminary injunctions asking the court to order the government to stop recoupments until a hearing was held was dismissed based on jurisdiction. In other words, the courts held that the courts did not have the authority to render an opinion as to recoupments prior to a hearing. Now, however, the trend is turning, and courts are starting to rule in favor of the provider, finding a violation of procedural due process based on a collateral claim exception.
There are four criteria in order to win a preliminary injunction. A party seeking a preliminary injunction must establish all for the following criteria: (1) that the party is likely to succeed on the merits; (2) that the party is likely to suffer irreparable harm in the absence of preliminary injunction; (3) that the balance of the equity tips in the party’s favor; and (4) that injunction is in the public interest.
There is an esoteric legal theory called exhaustion of administrative remedies. So jurisdiction is the question. There are exceptions to the judicial bar. The Supreme Court of United States articulated a collateral claim exception. The Supreme Court permitted a plaintiff to bring a procedural due process claim requesting an evidentiary area hearing before the termination of disability benefits. There are nonwaivable and waivable jurisdictional elements the nonwaivable requirement is that a claim must be presented to the administrative agency. The waivable requirement is that administrative remedies be exhausted.
The Collateral claim exception is when a party brings a claim in federal court when that “constitutional challenge is entirely collateral to its substantive claim of entitlement.”
The new trend in case law is that the courts are finding that the provider’s right to not undergo recoupment during the appeal process is a collateral issue as to the substantive issue of whether the provider owes the money. Therefore, the courts have found jurisdiction as to the collateral issue.
The proverbial ship has sailed. According to courts in Texas and now South Carolina, CMS cannot recoup monies prior to hearings before ALJs. Providers facing large recoupments should file TROs to prevent premature recoupments and to obtain due process.
Since 2012, Medicare has penalized hospitals for having too many patients end up back in their care within a month. Mind you, these re-admissions are not the hospitals’ fault. Many of the re-admissions are uninsured patients and who are without primary care. Without an alternative, they present back at the hospitals within 30 days. This penalty on hospitals is called the Hospital Readmissions Reduction Program (HRRP) and is not without controversy.
For example, if hospitals are not allowed to turn away patients for their lack of ability to pay, then penalizing the hospital for a readmission (who the hospital cannot turn away) seems fundamentally unfair. Imagine someone at the Center for Medicare and Medicaid Services (CMS) yelling at you: “You cannot turn away any patients by law! But if you accept a patient for readmission, then you will be penalized!!” The logic is incongruous. The hospital is found in a Catch-22. Damned if they do; damned if they don’t.
The Emergency Medical and Treatment Labor Act (EMTLA) passed by Congress in 1986 explicitly forbids the denial of care to indigent or uninsured patients based on a lack of ability to pay. It also prohibits “patient dumping” a practice in which a hospital orders unnecessary transfers while care is being administered and prohibits the suspension of care once it is initiated.
Even non-emergent care is generally required, depending on the hospital. Public hospitals may not deny patient care based on ability to pay (or lack thereof). Private hospitals may, in non-emergency situations, deny or discontinue care.
The most recent HRRP report, which concentrated on Connecticut hospitals, which will penalize CT hospitals for too many readmissions starting October 1, 2018, shows: 27 of the 29 hospitals evaluated — or 93% — will be penalized in the 2019 fiscal year (Oct. 1, 2018 – Oct. 1, 2019) that began Oct. 1, according to a Kaiser Health News analysis of CMS data. $566 million in total penalties will be required, depending on the severity of the violations.
Here is the formula used to determine penalties for readmission within 30 days to a hospital:
No hospital that was audited received the maximum penalty of 3%, but 9 CT hospitals will have their Medicare reimbursements reduced by 1% or more. They are: Waterbury Hospital at 2.19%, Bridgeport Hospital at 2.01%, Bristol Hospital at 1.91%, Manchester Memorial Hospital at 1.74%, Johnson Memorial Hospital in Stafford Springs at 1.71%, Midstate Medical Center in Meriden at 1.37%, St. Vincent’s Medical Center in Bridgeport at 1.21%, Griffin Hospital in Derby at 1.17%, and Yale New Haven Hospital at 1.03%.
There is controversy over the HRRP.
Observation status does not count.
Interestingly, what is not evaluated in the Hospital Readmission Reduction Program may be just as important, or more so, than what it is evaluated. -And what is not evaluated in the HRRP has morphed our health care system into a plethora of observation only admissions.
Patients who are admitted under observation status are excluded from the readmission measure. What, pray tell, do you think the result has been because of the observation status being excluded??
- More in-patient admissions?
- More observation status admissions?
- No change?
If you guessed more observation status admissions, then you would be correct.
Most hospitals have developed clinical decision units, which are typically short-stay observation areas designed to care for patients in less than 24-hours. The difference between inpatient and observation status is important because Medicare pays different rates according to each status. Patients admitted under observation status are considered outpatients, even though they may stay in the hospital for several days and receive treatment in a hospital bed. Medicare requires a three-day hospital inpatient stay minimum before it will cover the cost of rehabilitative care in a skilled nursing care center. However, observation stays, regardless of length, do not count toward Medicare’s requirement.
30-Day readmission period is arbitrary.
Why 30-days? If a patient is readmitted on the 30th day, the hospital is penalized. But if the patient is readmitted on Day 31, the hospital is not penalized. There just isn’t a lucid, common sense reason except that 30 is a nice, round number.
The HRRP disproportionately discriminates against hospitals that have high volume of uninsured.
HRRP does not adjust for socioeconomic status. This means that the HRRP may be penalizing hospitals, such as safety-net hospitals, that care for disadvantaged populations.
When other laws, unintentionally or intentionally, discriminate between socioeconomic status, often an association or group brings a class action lawsuit in federal court asking the judge to declare the law unconstitutional due to discrimination. Discrimination can be proven in court by how the law of supply or how the law is written.
Here, the 27 hospitals, which will be receiving penalties for fiscal year 2019, serve a high population of low income patients. The result of which hospitals are getting penalized is an indication of a discriminatory practice, even if it is unintentional.
The Upshot from Knicole:
These hospitals should challenge the HRRP legally. Reimbursements for services render constitute a property right. Usurping this property right without due process may be a violation of our Constitution. For $566 million…there should be a fair fight.
When action happens in the Medicare/caid world, it happens quickly. Sometimes you do not receive adequate notice to coordinate continuity of care for your consumers or patients. For example, on August 3, 2018, the Center for Medicare and Medicaid Services announced that at midnight on August 18, 2018, it would be terminating the contract between CMS and ESEC, LLC, an Oklahoma-based surgery center.
CMS provided ESEC 15 days notice of complete termination of Medicare and Medicaid reimbursements. Now I do not know the details of ESEC’s financial reliance on Medicare or Medicaid, but, these days, few providers are solely third-party pay or cash-only. I can only assume that ESEC is scrambling to initiate a lawsuit to remain afloat and open for business. Or ESEC is praying for a “rescind” by correcting whatever issues it purportedly had. Personally, I would not count on a possible rescind. I would be proactively seeking legal intervention.
Here are some examples of recent terminations and the notice received by the providers:
- Baylor St. Luke’s Medical Center’s heart transplant program lost federal funding August 17, 2018. The hospital will no longer be able to bill Medicare and Medicaid for heart transplants.
- Effective August 9, 2018, Brookwood Baptist Medical Center’s Medicare contract was terminated. The notice was published July 25, 2018.
- As of August 12, 2018, The Grandview Nursing & Rehabilitation Facility’s Medicare contract was terminated. Notice of the termination was published August 1, 2018.
- As of September 1, 2018, Compassus-Kansas City, a hospice company, will lose its Medicare contract. Notice was provided August 17, 2018.
- On August 3, 2018, CMS announced that it was terminating Deligent Health Services Inc.’s Medicare and Medicaid contact, effective December 5, 2017. (That is quite a retroactive timeframe).
Can Careless Judy put a healthcare provider out of business?
This happens all the time. Sure, ESEC probably had knowledge that CMS was investigating it. However, CMS has the authority to issue these public notices of termination without holding a hearing to determine whether CMS’ actions are accurate. What if Careless Judy in Program Integrity made a human error and ESEC actually does meet the standards of care. But you see, Careless Judy accidentally used the minimum standards of care from 2008 instead of 2018. It’s an honest mistake. She had no malice against ESEC. But, my point is – where is the mechanism that prevents a surgical ambulatory center from going out of business – just because Careless Judy made a mistake?
To look into whether any legal mechanism exists to prevent Careless Judy from putting the ambulatory center out of business, I turn to the legal rules.
42 CFR 488.456 governs terminations of provider agreements. Subsection (a) state that termination “ends – (1) Payment to the facility; and (2) Any alternative remedy.”
Subsection (b) states that CMS or the State may terminate the contract with the provider if the provider “Is not in substantial compliance with the requirements of participation, regardless whether immediate jeopardy is present.” On the bright side, if no immediate jeopardy exists then CMS or the State must give 15 days notice. If there is found to be immediate jeopardy, the provider get 2 days. But who determines what is “substantial compliance?” Careless Judy?
42 CFR 489.53 lists the reasons on which CMS may rely to terminate a provider. Although, please note, that the regulations use the word “may” and not “must.” So we have some additional guidance as to when a provider’s contract may be terminated, but it still seems subjective. Here are the reasons:
- The provider is not complying with the provisions of title XVIII and the applicable regulations of this chapter or with the provisions of the agreement.
- The provider or supplier places restrictions on the persons it will accept for treatment and it fails either to exempt Medicare beneficiaries from those restrictions or to apply them to Medicare beneficiaries the same as to all other persons seeking care.
- It no longer meets the appropriate conditions of participation or requirements (for SNFs and NFs) set forth elsewhere in this chapter. In the case of an RNHCI no longer meets the conditions for coverage, conditions of participation and requirements set forth elsewhere in this chapter.
- It fails to furnish information that CMS finds necessary for a determination as to whether payments are or were due under Medicare and the amounts due.
- It refuses to permit examination of its fiscal or other records by, or on behalf of CMS, as necessary for verification of information furnished as a basis for payment under Medicare.
- It failed to furnish information on business transactions as required in § 420.205 of this chapter.
- It failed at the time the agreement was entered into or renewed to disclose information on convicted individuals as required in § 420.204 of this chapter.
- It failed to furnish ownership information as required in § 420.206 of this chapter.
- It failed to comply with civil rights requirements set forth in 45 CFR parts 80, 84, and 90.
- In the case of a hospital or a critical access hospital as defined in section 1861(mm)(1) of the Act that has reason to believe it may have received an individual transferred by another hospital in violation of § 489.24(d), the hospital failed to report the incident to CMS or the State survey agency.
- In the case of a hospital requested to furnish inpatient services to CHAMPUS or CHAMPVA beneficiaries or to veterans, it failed to comply with § 489.25 or § 489.26, respectively.
- It failed to furnish the notice of discharge rights as required by § 489.27.
- The provider or supplier refuses to permit copying of any records or other information by, or on behalf of, CMS, as necessary to determine or verify compliance with participation requirements.
- The hospital knowingly and willfully fails to accept, on a repeated basis, an amount that approximates the Medicare rate established under the inpatient hospital prospective payment system, minus any enrollee deductibles or copayments, as payment in full from a fee-for-service FEHB plan for inpatient hospital services provided to a retired Federal enrollee of a fee-for-service FEHB plan, age 65 or older, who does not have Medicare Part A benefits.
- It had its enrollment in the Medicare program revoked in accordance to § 424.535 of this chapter.
- It has failed to pay a revisit user fee when and if assessed.
- In the case of an HHA, it failed to correct any deficiencies within the required time frame.
- The provider or supplier fails to grant immediate access upon a reasonable request to a state survey agency or other authorized entity for the purpose of determining, in accordance with § 488.3, whether the provider or supplier meets the applicable requirements, conditions of participation, conditions for coverage, or conditions for certification.
As you can see from the above list of possible termination reasons, many of which are subjective, it could be easy for Careless Judy to terminate a Medicare contract erroneously, based on inaccurate facts, or without proper investigation.
The same is true for Medicaid; your contract can be terminated on the federal or state level. The difference is that at the state level, Careless Judy is a state employee, not a federal.
42 CFR 498.5 governs appeal rights for providers contract terminations. Subsection (b) states that “Any provider dissatisfied with an initial determination to terminate its provider agreement is entitled to a hearing before an ALJ.”
42 CFR 498.20 states that an initial determination by CMS (like a contract termination) is binding unless it is reconsidered per 42 CFR 498.24.
A Stay of the termination should suspend the termination until the provider can obtain a hearing by an impartial tribunal until the appeal has been completed. The appeal process and supposed automatic Stay of the termination is the only protection for the provider from Careless Judy. Or filing an expensive injunction.
There is a federal regulation that is putting health care providers out of business. It is my legal opinion that the regulation violates the U.S. Constitution. Yet, the regulation still exists and continues to put health care providers out of business.
Because so far, no one has litigated the validity of the regulation, and I believe it could be legally wiped from existence with the right legal arguments.
How is this important?
Currently, the state and federal government are legally authorized to immediately suspend your Medicare or Medicaid reimbursements upon a credible allegation of fraud. This immense authority has put many a provider out of business. Could you survive without any Medicare or Medicaid reimbursements?
The federal regulation to which I allude is 42 CFR 455.23. It is a federal regulation, and it applies to every single health care provider, despite the service type allowed by Medicare or Medicaid. Home care agencies are just as susceptible to an accusation of health care fraud as a hospital. Durable medical equipment agencies are as susceptible as dentists. Yet the standard for a “credible allegation of fraud” is low. The standard for which the government can implement an immediate withhold of Medicaid/care reimbursements is lower than for an accused murderer to be arrested. At least when you are accused of murder, you have the right to an attorney. When you are accused to health care fraud on the civil level, you do not receive the right to an attorney. You must pay 100% out of pocket, unless your insurance happens to cover the expense for attorneys. But, even if your insurance does cover legal fees, you can believe that you will be appointed a general litigator with little to no knowledge of Medicare or Medicaid regulatory compliance litigation.
42 USC 455.23 states that:
“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.
(2) The State Medicaid agency may suspend payments without first notifying the provider of its intention to suspend such payments.
(3) A provider may request, and must be granted, administrative review where State law so requires.”
In the very first sentence, which I highlighted in red, is the word “must.” Prior to the Affordable Care Act, this text read “may.” From my years of experience, every single state in America has used this revision from “may” to “must” for governmental advantage over providers. When asked for good cause, the state and or federal government protest that they have no authority to make a decision that good cause exists to suspend any reimbursement freeze during an investigation. But this protest is a pile of hooey.
In reality, if anyone could afford to litigate the constitutionality of the regulation, I believe that the regulation would be stricken an unconstitutional.
Here is one reason why: Due Process
The Fifth and Fourteenth Amendments to the Bill of Rights provide us our due process rights. Here is the 5th Amendment:
“No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
There have been a long and rich history of interpretation of the due process clause. The Supreme Court has interpreted the due process clauses to provide four protections: (1) procedural due process (in civil and criminal proceedings), (2) substantive due process, (3) a prohibition against vague laws, and (4) as the vehicle for the incorporation of the Bill of Rights.
42 CFR 455.23 violates procedural due process.
Procedural due process requires that a person be allowed notice and an opportunity to be heard before a government official takes a person’s life, liberty, or property.
Yet, 42 CFR 455.23 allows the government to immediately withhold reimbursements for services rendered based on an allegation without due process and taking a provider’s property; i.e., money owed for services rendered. Isn’t this exactly what procedural due process was created to prevent???? Where is the fundamental fairness?
42 CFR 455.23 violates substantive due process.
The Court usually looks first to see if there is a fundamental right, by examining if the right can be found deeply rooted in American history and traditions.
Fundamental rights include the right to vote, right for protection from pirates on the high seas (seriously – you have that right), and the right to constitutional remedies. Courts have held that our right to property is a fundamental right, but to my knowledge, not in the context of Medicare/caid reimbursements owed; however, I see a strong argument.
If the court establishes that the right being violated is a fundamental right, it applies strict scrutiny. This test inquires into whether there is a compelling state interest being furthered by the violation of the right, and whether the law in question is narrowly tailored to address the state interest.
Where the right is not a fundamental right, the court applies a rational basis test: if the violation of the right can be rationally related to a legitimate government purpose, then the law is held valid.
Taking away property of a Medicare/caid provider without due process violates substantive due process. The great thing about writing your own blog is that no one can argue with you. Playing Devil’s advocate, I would anticipate that the government would argue that a suspension or withhold of reimbursements is not a “taking” because the withhold or suspension is temporary and the government has a compelling reason to deter health care fraud. To which, I would say, yes, catching health care fraud is important – I am in no way advocating for fraud. But important also is the right to be innocent until proven guilty, and in civil cases, our deeply-rooted belief in the presumption of innocence is upheld by the action at issue not taking place until a hearing is held.
For example, if I sue my neighbor and declare that he is encroaching on my property, the property line is not moved until a decision is in my favor.
Another example, if I sue my business partner for breach of contract because she embezzled $1 million from me, I do not get the $1 million from her until it is decided that she actually took $1 million from me.
So to should be – if a provider is accused of fraud, property legally owned by said provider cannot just be taken away. That is a violation of substantive due process.
42 CFR 455.23 violates the prohibition against vague laws
A law is void for vagueness if an average citizen cannot understand it. The vagueness doctrine is my favorite. According to census data, there are 209.3 million people in the US who are over 24-years. Of those over 24-years-old, 66.9 million have a college degree. 68% do not.
Although here is a quick anecdote: Not so sure that a college degree is indicative of intelligence. A recent poll of law students at Columbia University showed that over 60% of the students, who were polled, could not name what rights are protected by the 1st Amendment. Once they responded “speech,” many forgot the others. In case you need a refresher for the off-chance that you are asked this question in an impromptu interview, see here.
My point is – who is to determine what the average person may or may not understand?
Back to why 42 CFR 455.23 violates the vagueness doctrine…
Remember the language of the regulations: “The State Medicaid agency must suspend all Medicaid payments to a provider after the agency determines there is a credible allegation of fraud…”
“Credible allegation of fraud” is defined as an allegation, which has been verified by the State, from any source, including but not limited to the following:
- Fraud hotline complaints.
- Claims data mining.
- Patterns identified through provider audits, civil false claims cases, and law enforcement investigations. Allegations are considered to be credible when they have indicia of reliability and the State Medicaid agency has reviewed all allegations, facts, and evidence carefully and acts judiciously on a case-by-case basis.”
With a bit of research, I was able to find a written podcast published by CMS. It appears to be a Q and A between two workers at CMS discussing whether they should suspend a home health care agency’s reimbursements, similar to a playbook. I assume that it was an internal workshop to educate the CMS employees considering that the beginning of the screenplay begins with a “canned narrator” saying “This is a Medicaid program integrity podcast.”
The weird thing is that when you pull up the website – here – you get a glimpse of the podcast, but, at least on my computer, the image disappears in seconds and does not allow you to read it. I encourage you to determine whether this happens you as well.
While the podcast shimmered for a few seconds, I hit print and was able to read the disappearing podcast. As you can see, it is a staged conversation between “Patrick” and “Jim” regarding suspicion of a home health agency falsifying certificates of medical necessity.
On page 3, “Jim” says, “Remember the provider has the right to know why we are taking such serious action.”
But if your Medicare/caid reimbursements were suddenly suspended and you were told the suspension was based upon “credible allegations of fraud,” wouldn’t you find that reasoning vague?
42 CFR 455.23 violates the right to apply the Bill of Rights to me, as a citizen
This esoteric doctrine only means that the Bill of Rights apply to State governments. [Why do lawyers make everything so hard to understand?]
5th Circuit Finds Subject Matter Jurisdiction For Medicare and Medicaid Providers – Why Collards Matter
“I’d like some spaghetti, please, and a side of meatballs.” – This sentence is illogical because meatballs are integral to spaghetti and meatballs. If you order spaghetti – and -meatballs, you are ordering “spaghetti and meatballs.” Meatballs on the side is not a thing.
Juxtapose, a healthcare provider defending itself from an alleged overpayment, But during the appeal process undergoes a different penalty – the state or federal government begins to recoup future funds prior to a decision that the alleged recoupment is authorized, legal, or warranted. When a completely new issue unrelated to the allegation of overpayment inserts itself into the mix, then you have spaghetti and meatballs with a side of collard greens. Collard greens need to be appealed in a completely different manner than spaghetti and meatballs, especially when the collard greens could put the company out of business because of the premature and unwarranted recoupments without due process.
I have been arguing this for years based off of, not only, a 1976 Supreme Court case, but multiple state case law, as well as, success I have had in the federal and administrative courts, and BTW – logic.
On March 27, 2018, I was confirmed again. The Fifth Circuit Court of Appeals decided a landmark case for Medicare and Medicaid providers across the country. The case, Family Rehab., Inc. v Azar, 2018 U.S. App. LEXIS 7668, involved a Medicare home health service provider, which was assessed for approximately $7.8 million in Medicare overpayments. Family Rehab, the plaintiff in the case, relied on 88% to 94% of its revenue from Medicare. The company had timely appealed the alleged overpayment, and it was at the third level of the Medicare five step process for appeals. See blog. But there is a 3 – 5 year backlog on the third level, and the government began to recoup the $7.8 million despite the ongoing appeal. If no action were taken, the company would be out of business well-before any ALJ could rule on the merits of the case, i.e. whether the recoupment was warranted. How is that fair? The provider may not owe $7.8 million, but before an objective tribunal decides what is actually owed, if anything, we are going to go ahead and take the money and reap the benefit of any interest accrued during the time it takes the provider to get a hearing.
The backlog for Medicare appeals at the ALJ level is unacceptably long. See blog and blog. However, the federal regulations only prevent recoupment during the appeal process during the first and second levels. This is absolutely asinine and should be changed considering we do have a clause in the Constitution called “due process.” Purported criminals receive due process, but healthcare providers who accept Medicare or Medicaid, at times, do not.
At the third level of appeal, Family Rehab underwent recoupments, even though it was still appealing the decision, which immediately stifled Family Rehab’s income. Family Rehab, because of the premature recoupments, was at risk of losing everything, going bankrupt, firing its staff, and no longer providing medically necessary home health services for the elderly. This situation mimics a situation in which I represented a client in northern Indiana who was losing its Medicaid contract. I also successfully obtained a preliminary injunction preventing the provider from losing its Medicaid contract. See blog.
It is important to note that in this case the ZPIC had audited only 43 claims. Then it used a statistical method to extrapolate the alleged over-billings and concluded that the alleged overpayment was $7,885,803.23. I cannot tell you how many times I have disputed an extrapolation and won. See blog.
42 USC 1395(f)(f)(d)(1)(A) states that the ALJ shall conduct and conclude the hearing and render a decision no later than 90 days after a timely request. Yet the Fifth Circuit Court of Appeals found that an ALJ hearing would not be forthcoming not within 90 days or even 900 days. The judge noted in his decision that the Medicare appeal backlog for an ALJ hearing was 3 – 5 years. The District Court held that it lacked subject matter jurisdiction because Family Rehab had not exhausted its administrative remedies. Family Rehab appealed.
On appeal, Family Rehab argued the same arguments that I have made in the past: (1) its procedural due process and ultra vires claims are collateral to the agency’s appellate process; and (2) going through the appellate process would mean no review at all because the provider would be out of business by the time it would be heard by an ALJ.
What does collateral mean? Collard greens are collateral. When you think collateral; think collards. Collard greens do not normally come with spaghetti and meatballs. A collateral issue is an issue that is entirely collateral to a substantive agency decision and would not be decided through the administrative appeal process. In other words, even if Family Rehab were to only pursue the $7.8 million overpayment issue through the administrative process, the issue of having money recouped and the damage to the company that the recoupment was causing would never be heard by the ALJ because those “collateral” issues are outside the ALJ’s purview. The premature recoupment issue could not be remedied by an ALJ. The Fifth Circuit Court of Appeals agreed.
The collateral argument also applies to terminations of Medicare and Medicaid contracts without due process. In an analogous case (Affiliated Professional), the provider argued that the termination of its Medicare contract without due process violated its right to due process and the Equal Protection Clause and was successful.
The upshot is obvious, if the Court must examine the merits of the underlying dispute, delve into the statute and regulations, or make independent judgments as to plaintiff’s eligibility under a statute, the claim is not collateral.
The importance of this case is that it verifies my contention that if a provider is undergoing a recoupment or termination without due process, there is relief for that provider – an injunction stopping the premature recoupments or termination until due process has been completed.
Letter to HHS: RAC Audits “Have Absolutely No Direct Impact on the Medicare Providers” – And I Spotted Elvis!
“Recovery audits have absolutely no direct impact on the Medicare providers working hard to deliver much needed healthcare services to beneficiaries.“
And Elvis Presley is still alive! Oh, and did you know that Bill Clinton never had an affair on Hillary? (since when has her name become one word, like Prince or Beyonce?)
This sentence was written in a March 6, 2018, correspondence from The Council for Medicare Integrity to HHS Secretary Alex Azar.
“Recovery auditing has never been an impediment to the delivery of healthcare services nor is it an intrusion in the physician-patient relationship.” – Kristin Walter of The Council for Medicare Integrity. BTW, Ms. Walter, health care has a space between the two syllables.
The purpose of this letter that was sent from the The Council for Medicare Integrity to Secretary Azar was to request an increase of prepayment reviews for Medicare providers. For those of you so blessed to not know what a prepayment review, prepayment review is a review of your Medicare (or Caid) claims prior to being paid. It sounds reasonable on paper, but, in real life, prepayment review is a Draconian, unjust, and preposterous tool aimed at putting healthcare providers out of business, or if not aimed, is the unknown or accidental outcome of such a review. If placed on prepayment review, your Medicare or Medicaid reimbursements are 100% cut off. Gone. Like the girl in that movie with Ben Affleck, Gone Girl Gone, and, like the girl, not really gone because it’s alive – you provided services and are owed that money – but it’s in hiding and may ruin your life. See blog.
Even if I were wrong, which I am not, the mere process in the order of events of prepayment review is illogical. In the interest of time, I will cut-and-paste a section from a prior blog that I wrote about prepayment review:
In real-life, prepayment review:
- The auditors may use incorrect, inapplicable, subjective, and arbitrary standards.
I had a case in which the auditors were denying 100% ACTT services, which are 24-hour mental health services for those 10% of people who suffer from extreme mental illness. The reason that the auditor was denying 100% of the claims was because “lower level services were not tried and ruled out.” In this instance, we have a behavioral health care provider employing staff to render ACTT services (expensive), actually rendering the ACTT services (expensive), and getting paid zero…zilch…nada…for a reason that is not required! There is no requirement that a person receiving ACTT services try a lower level of service first. If the person qualifies for ACTT, the person should receive ACTT services. Because of this auditor’s misunderstanding of ACTT, this provider was almost put out of business.
Another example: A provider of home health was placed on prepayment review. Again, 90 – 100% of the claims were denied. In home health, program eligibility is determined by an independent assessment conducted by the Division of Medical Assistance (DMA) via Liberty, which creates an individualized plan of care. The provider submitted claims for Patient Sally, who, according to her plan, needs help dressing. The service notes demonstrated that the in-home aide helped Sally dress with a shirt and pants. But the auditor denies every claim the provider bills for Sally (which is 7 days a week) because, according to the service note, the in-home aide failed to check the box to show she/he helped put on Sally’s shoes. The auditor fails to understand that Sally is a double amputee – she has no feet.
Quis custodiet ipsos custodes – Who watches the watchmen???
- The administrative burden placed on providers undergoing prepayment review is staggering.
In many cases, a provider on prepayment review is forced to hire contract workers just to keep up with the number of document requests coming from the entity that is conducting the prepayment review. After initial document requests, there are supplemental document requests. Then every claim that is denied needs to be re-submitted or appealed. The amount of paperwork involved in prepayment review would cause an environmentalist to scream and crumple into the fetal position like “The Crying Game.”
- The accuracy ratings are inaccurate.
Because of the mistakes the auditors make in erroneously denying claims, the purported “accuracy ratings” are inaccurate. My daughter received an 86 on a test. Given that she is a straight ‘A’ student, this was odd. I asked her what she got wrong, and she had no idea. I told her to ask her teacher the next day why she received an 86. Oops. Her teacher had accidentally given my daughter an 86; the 86 was the grade of another child in the class with the same first name. In prepayment review, the accuracy ratings are the only method to be removed from prepayment, so the accuracy of the accuracy ratings is important. One mistaken, erroneously denied claim damages the ratings, and we’ve already discussed that mistakes/errors occur. You think, if a mistake is found, call up the auditing entity…talk it out. See below.
- The communication between provider and auditor do not exist.
Years ago my mom and I went to visit relatives in Switzerland. (Not dissimilar to National Lampoon’s European Vacation). They spoke German; we did not. We communicated with pictures and hand gestures. To this day, I have no idea their names. This is the relationship between the provider and the auditor.
Assuming that the provider reaches a live person on the telephone:
“Can you please explain to me why claims 1-100 failed?”
“Don’t you know the service definitions and the policies? That is your responsibility.”
“Yes, but I believe that we follow the policies. We don’t understand why these claims are denied. That’s what I’m asking.”
“Read the policy.”
- The financial burden on the provider is devastating.
If a provider’s reimbursements are 80 – 100% reliant on Medicaid/care and those funds are frozen, the provider cannot meet payroll. Yet the provider is expected to continue to render services. A few years ago, I requested from NC DMA a list of providers on prepayment review and the details surrounding them. I was shocked at the number of providers that were placed on prepayment review and within a couple months ceased submitting claims. In reality, what happened was that those providers were forced to close their doors. They couldn’t financially support their company without getting paid.
Back to the current blog
So to have The Council for Medicare Integrity declare that prepayment review has absolutely no impact on Medicare providers is ludicrous.
Now, I will admit that the RAC (and other acronyms) prepayment and post payment review programs have successfully recovered millions of dollars of alleged overpayments. But these processes must be done right, legally. You can’t just shove an overzealous, for-profit, audit company out the door like an overweight kid in a candy store. Legal due process and legal limitations must be required – and followed.
Ms. Walter does present some interesting, yet factually questionable, statistics:
- “Over the past 5 years alone, Medicare has lost more than $200 billion taxpayer dollars to very preventable billing errors made by providers.”
Not quite sure how this was calculated. A team of compliance auditors would have had to review hundreds of thousands of medical records to determine this amount. Is she referring to money that has been recovered and the appeal process afforded to the providers has been exhausted? Or is this number how much money is being alleged has been overpaid? How exactly were these supposed billing errors “very preventable?” What does that mean? She is either saying that the health care providers could have prevented the ostensible overbillings – or – she is saying that RAC auditors could have prevented these purported overbillings by increased prepayment review. Either way … I don’t get it. It reminds me of Demi Moore in A Few Good Men, “I object.” Judge states, “Overruled.” Demi Moore pleads, “I strenuously object.” Judge states, “Still overruled.” “Very preventable billing errors,” said Ms. Walters. “Still overruled.”
- “Currently, only 0.5 percent of Medicare claims are reviewed, on a post-payment basis, for billing accuracy and adherence to program billing rules. This leaves 99.5 percent of claims immune from any checks and balances that would ensure Medicare payments are correct.”
Again, I am curious as to the mathematic calculation used. Is she including the audits performed, not only by RACs, but audits by ZPICs, CERTS, MACs, including Palmetto, Noridian and CGS, federal and state Program Integrities, State contractors, MFCUs, MICs, MCOs, PERMs, PCG, and HHS? Because I can definitely see that we need more players.
- “The contrast between Medicare review practices and private payers is startling. Despite the dire need to safeguard Medicare dollars, CMS currently allows Recovery Audit Contractors (RACs) to review fewer than 30 Medicare claim types (down from 800 claim types initially) and has scaled back to allow a review of a mere 0.5 percent of Medicare provider claims after they have been paid. Considered a basic cost of doing business, the same providers billing Medicare comply, without issue, with the more extensive claim review requirements of private health insurance companies. With Medicare however, provider groups have lobbied aggressively to keep their overpayments, putting intense pressure on CMS to block Medicare billing oversight.”
Did I wake up in the Twilight Zone? Zombies? Let’s compare Medicare/caid to private health care companies.
First, let’s talk Benjamins (or pennies in Medicare/caid). A study was conducted to compare Texas Medicare/caid reimbursement rates to private pay. Since everything is bigger in Texas, including the reimbursement rates for Medicare/caid, I figured this study is demonstrative for the country (obviously each state’s statistics would vary).
According to a 2016 study by the National Comparisons of Commercial and Medicare Fee-For-Service Payments to Hospitals:
- 96%. In 2012, average payments for commercial inpatient hospital stays were higher than Medicare fee-for-service payments for 96% of the diagnosis related groups (DRGs) analyzed.
- 14%. Between 2008 and 2012, the commercial-to-Medicare payment difference had an average increase of 14%.
- 86%. Longer hospital stays do not appear to be a factor for higher average commercial payments. During this period, 86 percent of the DRGs analyzed had commercial-to-Medicare average length-of-stay of ratios less than one.
The “basic cost of doing business” for Medicare/caid patients is not getting appropriate reimbursement rates.
The law states that the reimbursements rates should allow quality of care. Section 30(A) of the Medicare Act requires that each State “provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan (including but not limited to utilization review plans as provided for in section 1396b(i)(4) of this title) as may be necessary to safeguard against unnecessary utilization of such care and services and to assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area.” (emphasis added).
Second, billing under Medicare/caid is much more complex than billing third-party payors, which are not required to follow the over-regulated, esoteric, administrative, spaghetti sauce that mandates providers who accept Medicare and/or Medicaid (a whole bunch of independent vegetables pureed into a sauce in which the vegetables are indiscernible from the other). The regulatory burden required of providing Medicare and/or Medicaid services does not compare to the administrative and regulatory burden associated with private pay, regardless of Ms. Walter’s uncited and unreferenced claims that “the more extensive claim review requirements [are with the] private health insurance companies.” We’re talking kumquats to rack of lamb (are kumquats cheap)?
Third, let’s discuss this comment: “provider groups have lobbied aggressively.” RAC auditors, and all the other alphabet soup, are paid A LOT. Government bureaucracy often does not require the same “bid process” that a private company would need to pass. Some government contracts are awarded on a no-bid process (not ok), which does not create the best “bang for your buck for the taxpayers.”
I could go on…but, I believe that you get the point. My readers are no dummies!
I disagree with the correspondence, dated March 6, 2018, from The Council for Medicare Integrity to HHS Secretary Alex Azar is correct. However, my question is who will push back against The Council for Medicare Integrity? All those health care provider associations that “have lobbied aggressively to keep their overpayments, putting intense pressure on CMS to block Medicare billing oversight.”?
At the end of the day (literally), I questioned the motive of The Council for Medicare Integrity. Whenever you question a person’s motive, follow the money. So, I googled “who funds The Council for Medicare Integrity? Unsurprisingly, it was difficult to locate. According to The Council for Medicare Integrity’s website it provides transparency with the following FAQ:
Again, do you see why I am questioning the source of income?
According to The Council for Medicare Integrity, “The Council for Medicare Integrity is a 501(c)(6) non-profit organization. The Council’s mission is to educate policymakers and other stakeholders regarding the importance of healthcare integrity programs that help Medicare identify and correct improper payments.
As a 501(c)(6) organization, the Council files IRS Form 990s annually with the IRS as required by law. Copies of these filings and exemption application materials can be obtained by mailing your request to the Secretary at: Council for Medicare Integrity, Attention: Secretary, 9275 W. Russell Road, Suite 100, Las Vegas, Nevada 89148. In your request, please provide your name, address, contact telephone number and a list of documents requested. Hard copies are subject to a fee of $1.00 for the first page and $.20 per each subsequent page, plus postage, and must be made by check or money order, payable to the Council for Medicare Integrity. Copies will be provided within 30 days from receipt of payment. These documents are also available for public inspection without charge at the Council’s principal office during regular business hours. Please schedule an appointment by contacting the Secretary at the address above.
This website serves as an aggregator of all the verifiable key facts and data pertaining to this important healthcare issue, as well as a resource center to support the provider community in their efforts to comply with Medicare policy.”
I still question the funding (and the bias)…Maybe funded by the RACs??