Category Archives: Public Health Emergency
2020 was an odd year for recovery audit contractor (“RAC”) and Medicare Administrative Contractors (“MAC”) audits. Well, it was an odd year for everyone. After trying five virtual trials, each one with up to 23 witnesses, it seems that, slowly but surely, we are getting back to normalcy. A tell-tale sign of fresh normalcy is an in-person defense of health care regulatory audits. I am defending a RAC audit of pediatric facility in Georgia in a couple weeks and the clerk of court said – “The hearing is in person.” Well, that’s new. Even when we specifically requested a virtual trial, we were denied with the explanation that GA is open now. The virtual trials are cheaper and more convenient; clients don’t have to pay for hotels and airlines.
In-person hearings are back – at least in most states. We have similar players and new restrictions.
On March 16, 2021, CMS announced that it will temporarily restrict audits to March 1, 2020, and before. Medicare audits are not yet dipping its metaphoric toes into the shark infested waters of auditing claims with dates of service (“DOS”) March 1 – today. This leaves a year and half time period untouched. Once the temporary hold is lifted, audits of 2020 DOS will be abound. March 26, 2021, CMS awarded Performant Recovery, Inc., the incumbent, the new RAC Region 1 contract.
RAC’s review claims on a post-payment and/or pre-payment basis. (FYI – You would rather a post payment review rather than a pre – I promise).
The RACs were created to detect fraud, waste, and abuse (“FWA”) by reviewing medical records. Any health care provider – not matter how big or small – are subject to audits at the whim of the government. CMS, RACs, MCOs, MACs, TPEs, UPICs, and every other auditing company can implement actions that will prevent future improper payments, as well. As we all know, RACs are paid on a contingency basis. Approximately, 13%. When the RACs were first created, the RACs were compensated based on accusations of overpayments, not the amounts that were truly owed after an independent tribunal. As any human could surmise, the contingency payment creates an overzealousness that can only be demonstrated by my favorite case in my 21 years – in New Mexico against Public Consulting Group (“PCG”). A behavioral health care (“BH”) provider was accused of over $12 million overpayment. After we presented before the administrative law judge (“ALJ”) in NM Administrative Court, the ALJ determined that we owed $896.35. The 99.23% reduction was because of the following:
- Faulty Extrapolation: NM HSD’s contractor PCG reviewed approximately 150 claims out of 15,000 claims between 2009 and 2013. Once the error rate was defined as high as 92%, the base error equaled $9,812.08; however the extrapolated amount equaled over $12 million. Our expert statistician rebutted the error rate being so high. Once the extrapolation is thrown out, we are now dealing with much more reasonable amounts – only $9k
- Attack the Clinical Denials: The underlying, alleged overpayment of $9,812.08 was based on 150 claims. We walked through the 150 claims that PCG claimed were denials and proved PCG wrong. Examples of their errors include denials based on lack of staff credentialing, when in reality, the auditor could not read the signature. Other denials were erroneously denied based the application of the wrong policy year.
The upshot is that we convinced the judge that PCG was wrong in almost every denial PCG made. In the end, the Judge found we owed $896.35, not $12 million. Little bit of a difference! We appealed.
Even though the public health emergency (“PHE”) for the COVID pandemic is scheduled to expire July 24, 2020, all evidence indicates that the PHE will be renewed. I cannot imagine a scenario in which the PHE is not extended, especially with the sudden uptick of COVID.
Center for Medicare and Medicaid Services (CMS) has given guidance that the voluminous number of exceptions that CMS has granted during this period of the PHE may be extended to Dec. 1, 2020. However, there is no indication of the RAC, and MAC audits being suspended until December 2020. In fact, we expect the audits to begin again any day. There will be confusion when audits resume and COVID exceptions are revoked on a rolling basis.
Remember the emergency-room physician whom I spoke about on the June 29 on Monitor Mondays? The physician whose Medicare enrollment was revoked due to a computer error or an error on the part of CMS. What normally would have been an easy fix, because of COVID, became more difficult. Because of COVID, he was unable to work for three months. He is back up and running now. The point is that COVID really messed up so many aspects of our lives.
The extension of PHE, technically, has no bearing on RAC and MAC audits coming back. Word on the street is that RAC and MAC audits are returning August 2020.
This month, July 2020, CMS released, “Coronavirus Disease 2019 (COVID-19) Provider Burden Relief Frequently Asked Questions (FAQs).” (herein afterward referred as “CMS July 2020 FAQs”).
The question was posed to CMS: “Is CMS suspending most Medicare-Fee-for-Service (FFS) medical review during the PHE for the COVID-19 pandemic? The answer is, according to CMS, “As states reopen, and given the importance of medical review activities to CMS’ program integrity efforts, CMS expects to discontinue exercising enforcement discretion beginning on Aug. 3, 2020, regardless of the status of the public health emergency. 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 in place at the time of the dates of service of any claims potentially selected for review will also be applied.” See CMS July 2020 FAQs.
Monday, July 13, 2020, we began our fourth “COVID-virtual trial.” The Judges with whom I have had interaction have taken a hard stance to not “force” someone to appear in person. It appears, at least to me, that virtual trials are the wave of the future. This is the guidance that conveys to me that RAC and MAC audits will begin again in August. Virtual audits may even be the best thing that ever happened to RAC and MAC audits. Maybe now the auditors will actually read the documents that the provider gives them.
Another specific issue addressed in the CMS’ July 2020 FAQs is that given the nature of the pandemic and the inability to collect signatures during this time, CMS will not be enforcing the signature requirement. Typically, Part B drugs and certain Durable Medical Equipment (DME) covered by Medicare require proof of delivery and/or a beneficiary’s signature. Suppliers should document in the medical record the appropriate date of delivery and that a signature was not able to be obtained because of COVID-19. This exception may or may not extend until Dec. 31, 2020.
The upshot is that no one really knows how the next few months will unfold in the healthcare industry. Some hospitals and healthcare systems are going under due to COVID. Big and small hospital systems are in financial despair. A RAC or MAC audit hitting in the wake of the COVID pandemic could cripple most providers. I will reiterate my recommendation: In the re-arranged words of Roosevelt, “Speak loudly, and carry a big stick.”
Programming Note: Knicole Emanuel is a permanent panelist on Monitor Mondays. Listen to her live reporting every Monday at 10 a.m. EST.
As of now, the public health emergency (PHE) for the COVID-19 pandemic will expire July 24, 2020, unless it is renewed. Fellow contributor David Glaser and I have both reported on the potential end date of the PHE. Recent intel from Dr. Ronald Hirsh is that the Centers for Medicare & Medicaid Services (CMS) may renew the PHE period. Each time the PHE period is renewed, it is effective for another 90 days. Recent news about the uptick in COVID cases may have already alerted you that the PHE period will probably be prolonged.
CMS has given guidance that the exceptions that it has granted during this period of the PHE may be extended to Dec. 1, 2020. There is no indication of the Recovery Audit Contractor (RAC) and Medicare Administrative Contractor (MAC) audits being suspended until December 2020. In fact, we expect the audits to begin again any day. There will be confusion when audits resume and COVID exceptions are revoked on a rolling basis.
I witnessed some interesting developments as a health care attorney during this ongoing pandemic. Three of my physician clients were erroneously placed on the Medicare exclusion lists. One would think that during the pandemic, CMS would move mountains to allow a Harvard-trained ER doctor to work in an ER. Because of the lack of staff, it was actually difficult to achieve an easy fix. This doctor was suspended from Medicare based on an accidental and inadvertent omission of a substance abuse issue more than 10 years ago. He disclosed everything except an 11-year-old misdemeanor. He did not omit the misdemeanor purposely. Instead, this ER physician relies on other hospital staff to submit his Medicare re-credentialing every year, as he should. It just happened that this year, the year of COVID, this doctor got caught up in a mistake that in normal times would have been a phone call away from fixing. We cleared up his issue, but not until he was unable to work for over two months, during the midst of the PHE.
At the time of the announcement of the public health emergency, another company, a home health provider, was placed on prepayment review. I am not sure how many of you are familiar with prepayment review, but this is a Draconian measure that all States and the federal government may wield against health care providers. When you are on prepayment review, you cannot get paid until another independent contracted entity reviews your claims “objectively.” I say objectively in quotes because I have yet to meet a prepayment review audit with which I agreed.
Mostly because of COVID, we were forced to argue for a preliminary injunction, allowing this home heath provider to continue to provide services and get paid for services rendered during the PHE. We were successful. That was our first lawsuit during COVID. I believe we went to trial in April 2020. We had another trial in May 2020, for which we have not received the result, although we have high hopes. I may be able to let you know the outcome eventually. But for now, because of COVID, with a shortage of court reporters willing to work, we will not receive the transcript from the trial until over four weeks after the trial.
Tomorrow, Tuesday, we begin our third COVID trial. For the first time since COVID, it will not be virtual. This is the guidance that conveys to me that RAC and MAC audits will begin again soon. If a civil judge is ordering the parties to appear in person, then the COVID stay-at-home orders must be decreasing. I cannot say I am happy about this most recent development (although audits may be easier if they are conducted virtually).
The upshot is that no one really knows how the next few months will unfold in the healthcare industry. Some hospitals and healthcare systems are going under due to COVID. Big and small hospital systems are in financial despair. A RAC or MAC audit hitting in the wake of the COVID pandemic could cripple most providers. In the rearranged words of Roosevelt, “speak loudly, and carry a big stick.”