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RAC Audit Preview: And Those on The Chopping Block Are…(Drum Roll, Please)

The Centers for Medicare & Medicaid Services (CMS) posted its December 2017 list of health care services that the Recovery Audit Contractors (RACs) will be auditing. As usual, home health is on the chopping block. So are durable medical equipment providers. For whatever reason, it seems that home health, DME, behavioral health care, and dentists are on the top of the lists for audits, at least in my experience.

Number one RAC audit issue: 

Home Health: Medical Necessity and Documentation Review

To be eligible for Medicare home health services, a beneficiary must have Medicare Part A and/or Part B per Section 1814 (a)(2)(C) and Section 1835 (a)(2)(A) of the Social Security Act:

  • Be confined to the home;
  • Need skilled services;
  • Be under the care of a physician;
  • Receive services under a plan of care established and reviewed by a physician; and
  • Have had a face-to-face encounter with a physician or allowed Non-Physician Practitioner (NPP).

Medical necessity is the top audited issue in home health. Auditors also love to compare the service notes to the independent assessment. Watch it if you fail to do one activity of daily living (ADL). Watch it if you do too many ADLs out of the kindness of your heart. Deviations from the independent assessment is a no-no to auditors, even if you are going above and beyond to be sweet. And never use purple ink!

Number two RAC audit issue:

Annual Wellness Visits (AWV) billed within 12 months of the Initial Preventative Physical Examination (IPPE) or Annual Wellness Examination (AWV)

This is a simple mathematical calculation. Has exactly 12 months passed? To the day….yes, they are that technical. 365 days from a visit on January 7, 2018 (my birthday, as an example) would be January 7, 2019. Schedule any AWV January 8, 2019, or beyond.

Number three RAC audit issue:

Ventilators Subject to DWO requirements on or after January 1, 2016

This will be an assessment of whether ventilators are medically necessary. Seriously? Who gets a ventilator who does not need one? I was thinking the other day, “Self? I want a ventilator.”

Number four RAC audit issue:

Cardiac Pacemakers

This will be an assessment of whether cardiac pacemakers are medically necessary. Seriously? Who gets a pacemaker who does not need one? I was thinking the other day, “Self? I want a pacemaker.” Hospitals are not the only providers targets for this audit. Ambulatory surgical centers (ASCs) also will be a target. As patient care continues its transition to the outpatient setting, ASCs have quickly grown in popularity as a high-quality, cost-effective alternative to hospital-based outpatient care. In turn, the number and types of services offered in the ASC setting have significantly expanded, including pacemakers.

Number five RAC audit issue:

Evaluation and Management (E/M) Same Day as Dialysis

Except when reported with modifier 25, payment for certain evaluation and management services is bundled into the payment for dialysis services 90935, 90937, 90945, and 90947

It is important to remember that if you receive a notice of overpayment, you need to appeal immediately. The first level of appeal is redetermination, usually with the Medicare Administrative Contractor (MAC). Medicare will not begin overpayment collection of debts (or will cease collections that have started) when it receives notice that you  requested a Medicare contractor redetermination (first level of appeal).

See blog for full explanation of Medicare provider appeals.

OIG Finds Questionable Billing! California Medicaid Dentists: Expect Withholdings or Other Penalties!

Currently, dentists who accept Medicaid are ripe for pickings as targets for regulatory audits from both the federal and state governments. Actually, this is true for any provider that accepts Medicaid. It just happens that, recently, I have noticed an uptick in dental audits both in North Carolina and nationwide. Some dentists, who accept pregnancy Medicaid, may even bear the burden of determining pregnancy prior to a teeth cleaning…however, that is a topic for another day.  Although, I tell you what, if my dentist asked whether I were pregnant prior to cleaning my teeth, he may have an abnormally red cheek the remainder of the day and I may join Crossfit.

Moving on….

Generally, dentists tend to not accept Medicaid. The reimbursement rates barely cover overhead. Add high regulatory compliance requirements, the likelihood of undergoing audits, and the government’s robust and zealous desire to tackle fraud, waste, and abuse (FWA), and it is no wonder why most dentists opt to not accept Medicaid. See blog. And blog.

Those dentists (and other providers) that do make the decision to accept Medicaid, these brave and noble souls, are subject to onerous audits; the result of a recent California audit is probably sending shock waves through the California dental community.

335 dental providers in California have been targeted by OIG as having questionable billing issues. Sadly, this is only the beginning for these 335 providers. Now the state will audit the providers, and these 335 providers may very well become the subject of a payment withhold in the near future.

What will happen next?

I will look into my crystal ball, otherwise known as experience, and let you know.

First, the Office of Inspector General (OIG) recently published a report called: “QUESTIONABLE BILLING FOR MEDICAID PEDIATRIC DENTAL SERVICES IN CALIFORNIA.

One can only imagine by the title that OIG found alleged questionable billing. Otherwise the title may have been, “A Study into Medicaid Billing for Medicaid Pediatric Dental Services,” instead of “Questionable Billing.” With such a leading title, a reader knows the contents before reading one word.

What is questionable billing?

Importantly, before addressing what IS questionable billing, what is NOT questionable billing? Questionable billing is not abhorrent billing practices. Questionable billing is not wasteful billing or abusive billing. And questionable billing is certainly not fraudulent billing. That is not to say that some of these questionable billing will be investigated and, perhaps, fall into one the aforementioned categories. But not yet. Again, these dentists have a long journey ahead of them.

In this context, questionable billing seems to mean that the OIG report identifies dentists who perform a higher number of services per day. OIG analyzed rendering dental providers’ NPI numbers to determine how many services each rendering provider was providing per day. Then OIG compared the average Medicaid payment per kid, number of services per day, and number of services provided per child per visit. OIG determined a “threshold” number for each category and cited questionable billing practices for those dentists that fell egregiously outside the thresholds. Now, obviously, this is a simplistic explanation for a more esoteric procedure, but the explanation is illustrative.

This study of California Medicaid dentists is not first dental study OIG has undertaken. Recently, OIG studied Medicaid dentists in New York, Louisiana, and Indiana. What stands out in the California Medicaid dental study is the volume of dentists involved in the study. In Indiana, OIG reviewed claims for 787 dentists; in New York it reviewed claims for 719 dentists, and in Louisiana, OIG studied 512 dentists’ claims, all of whom rendered services to over 50 Medicaid children.

In California, OIG studied 3,921 dentists.

Why such a difference?

Apparently, California has more dentists than the other three states and more dentists who accept Medicaid. So, if you are Medicaid dentists, apparently, there is more competition in California.

Juxtapose that, in California, in 2012, only 3 periodontists, 3 prosthodontists, 2 endodontists, and 1 oral pathologist provided services to 50 or more children with Medicaid in California.

Going back to the audit findings…

OIG considered dentists who exceeded its identified threshold for one or more of the seven measures to have questionable billing.

The result?

OIG identified 329 general dentists and 6 orthodontists out of 3,921 providers as having with questionable billing. But these findings are only the beginning of what will, most likely, become a long and tedious legal battle for these 335 providers. Lumping together so many dentists and claiming questionable billing practices will inevitably include many dentists who have done nothing irregular. Many other dentists, will have engaged in unintentional billing errors and may owe recoupments. But I foresee a very small number of these dentists to actually have committed fraudulent billing.

Here is an example found in the OIG’s report, OIG identified that 108 dentists provided stainless steel crowns to 18% of the children served by these dentists, compared to an average of only 5% of children receiving stainless steel crowns by those served by all general dentists (non-Medicaid).

Another example is that 98 dentists provided pulpotomies to 18% of the children, while the statewide percentage is 5% to undergo pulpotomies.

Do these examples show that 108 dentists providing stainless steel crowns and that 98 dentists providing pulpotomies are improperly billing?

Of course not.

It is only logical that dentists who accept Medicaid would have a significantly higher number of pulpotomies compared to dentists who service the privately insured. Usually, although not always, a Medicaid recipient will have more issues with their teeth than those privately insureds. In order to qualify for Medicaid, the family must live in poverty (some more than others with the expansion of Medicaid in some states). Some of kids in this population will have parents who do not harp on the importance of dental hygiene, thus allowing many kids in this population to have decay in their teeth. Obviously, this is a generalization; however, I am confident that many studies exist to back up this generalization.

Therefore, if you accept  my generalization, it makes sense that Medicaid dentists perform more pulpotomies than private insurance dentists.

And stainless steel crowns go hand in hand with pulpotomies. Unless you extract the tooth after the removal of the decay, you will need to provide a stainless steel crown to protect the tooth from future damage.

What will happen next?

OIG admits in its report that “our findings do not prove that providers either billed fraudulently or provided medically unnecessary services, providers with extreme billing patterns warrant further scrutiny.”

Which is precisely what will happen next…”further scrutiny”…

The OIG report recommends to California that it:

• Increase its monitoring of dental providers to identify patterns of questionable billing
• Closely monitor billing by providers in dental chains
• Review its payment processes for orthodontic services
• Take appropriate action against dental providers with questionable billing

It is that last recommendation, taking appropriate action, which will determine the future course for these 335 Medicaid providers. Because, as many of you know if you have followed my blog, the California Department of Health Care Services (DHCS) has a large toolbox with a considerable amount of tools for which it may yield its power against these providers…right or wrong. The same goes for all state Medicaid agencies. When it comes to a Medicaid provider and a Medicaid state agency, there is no balance of powers, in fact, there is only one power. Instead the scales of justice have one arm on the ground and the other raised in the air. There is an imbalance of power, unless you arm yourself with the right allies.

Possible future actions by DHCS:

• Payment suspensions
• Withholds of all reimbursements
• Post payment review
• Prepayment review

And combinations thereof.

DCHS stated that “it will review the dental providers referred by OIG and will determine by December 2015 what appropriate action may be warranted. Should there exist any provider cases not previously evaluated by existing program monitoring efforts, DHCS will take appropriate action through the available channels.”

First, December 2015 is a short timeframe for DCHS to audit 335 providers’ records and determine the proper course of action. So, expect a vendor for DCHS to be hired for this task. Also, expect that an audit of 335 providers in 7 months will have flaws.

These California dentists and orthodontists need to arm themselves with defense tools. And, quickly. Because it is amazing how fast 7 months will fly by!!

The report also states that OIG will be undertaking a study in the future to determine access to dental care issues.  I will be interested in the result of that study.

These possible penalties that I already enumerated above are not without defenses.

These 335 CA Medicaid dental providers have administrative remedies to prevent these possible penalties.   In other words, these 335 CA Medicaid dental providers do not have to take this lying down. Even though it appears that an imbalance of power exists between the state agency and the providers, these providers have appeal rights.

The second that any of these providers receive correspondence from DCHS, it is imperative that the provider contact its attorney.

Remember, some appeals have very short windows for which to appeal.  Do not miss an appeal deadline!!

DMA’s Own Error Regarding NCTracks Causing Dentists Undue Hardship?

As a Medicaid attorney and a bloggist (is that a word?), I tend to get numerous phone calls during the day from people with “information” or “evidence” that will, if I use it correctly, “take down Medicaid.” Numerous callers claim to have “smoking guns.” First of all, I do not wish to take down Medicaid. I only wish that Medicaid recipients receive good, quality healthcare, Medicaid providers receive reasonable reimbursements , and the State of North Carolina manages Medicaid in a cost-efficient, effective manner. One can dream, right?

With all the “smoking gun” phone calls, I rarely publish a blog without considerable research. Today, I am bucking my own rule. This blog is unverified. This blog is based-off of a telephone call.  The only reason I am publishing an unverified blog is because (a) Medicaid is so crazy right now…so many changes…so many players…so many bad things happening to Medicaid providers that, I believe, the more information the better; (b) I do not believe I could ever verify this blog completely; and (c) if this blog is even partially correct, maybe, I will educate/inform some dentists who accept Medicaid.

I received a phone call today from a dental provider in the western part of North Carolina.  She gave me some pretty disturbing information about NCTracks.  According to her, (we will call her Jane), NOT ONE dental Medicaid provider has received Medicaid reimbursements from NCTracks, which went live July 1, 2013. (Now, obviously, Jane has not contacted every dentist in NC who accepts Medicaid, so this information is not verified). However, according to Jane, her information source, besides her colleagues and friends with whom she has discussed this issue, is the Division of Medical Assistance (DMA). So this is not verified, but…

Still…what if it is only 1/2 true? Then Department of Health and Human Services (DHHS) has been less than upfront regarding the success of NCTracks.

If an NCTracks problem were so widespread, wouldn’t DHHS have issued some sort of statement? So I looked.  I found:

For Immediate Release
Monday, July 8, 2013

Raleigh, N.C. – Today, the North Carolina Department of Health and Human Services (DHHS) announced that NCTracks will successfully pay its first round of Medicaid claims this week, surpassing expectations of many health care providers.

“NCTracks is working so well after its first week in operation, we will pay many claims a full week ahead of schedule,” said Joe Cooper, Chief Information Officer for DHHS. “We are continuing to address specific technical issues as they come up, but this should be welcome news to North Carolina’s hospitals, long-term care facilities, physicians, dentists and pharmacies.”

Working so well that NCTracks will be paying providers a week early???? Really?  This same quote was published in the Triangle Business Journal three days ago in an article explaining that providers have not “sounded praise bells to quite the same tone, [but] there hasn’t been a widespread negative outcry either.”

According to Jane, who runs 6 dental practices, Jane has not received 1 penny from Medicaid since June 20, 2013 (the cut-off for billing before NCTracks went live). Almost 1 month. In order to meet payroll, Jane was forced to get a loan from a bank.  So far, Jane’s dental practice is owed approximately $300,000 in unpaid Medicaid reimbursements, no small amount, especially when Medicaid reimbursements barely cover administrative costs as it is.

To make matters worse, Jane was informed by the Division of Medical Assistance (DMA) that the Wednesday, June 17, 2013, checkwrite (EFT effective date) will not occur.  She also heard that the Tuesday, July, 23 2013, checkwrite date will not occur unless quick and drastic measures are taken.

Jane said that, at first, Jane was worried that she was not doing something correctly and that the lack of reimbursements were somehow her fault.  She contacted DMA and asked many questions. 

She heard (unverified) that DMA knows of this issue (the issue that zero dental providers are receiving reimbursements from NCTracks) and that DMA has admitted via email that DMA, itself, made a mistake that led to the nonpayment of Medicaid reimbursements to dentists.  As in, the fact that dentists have received zero reimbursements since NCTracks’ inception is due to DMA’s own fault. (Something about incorrectly linking providers’ Medicaid numbers…)

Without Medicaid reimbursements, many smaller dental practices will be forced to close because they simply cannot function without these Medicaid reimbursements; they won’t be able to make payroll.

While I readily admit that this blog is unverified, if it is correct that all (or even most) dentists are not receiving Medicaid reimbursements, then I say, “Shame!”

If this is a widespread, state-wide issue for all dental providers who accept Medicaid, I say, “Shame on you, DHHS, for not publicizing that Medicaid reimbursements are not being paid to dentists across the board.”  Many dental providers are probably, as Jane did at first, wondering what they are doing wrong.  They have probably wasted hours and hours reviewing the billing claims and trying to assess what the problem is (probably blaming the billing person at their office).

We all understand DHHS’ utter abhorrence if (a) this were true; and (b) the media found out, but, AT THE VERY LEAST, publicize the issue to the dental providers adversely affected.

NCTracks has been a heated issue for DHHS since the beginning.

Before NCTracks ever went live, the NC Office of State Auditor issued a report that NCTracks had failed to fully test a new $484 million computer system scheduled to begin processing Medicaid claims on July 1. See my blog on NCTracks.

Since July 1, 2013, when NCTracks went live, I have heard numerous complaints. But, from I have seen in the media, DHHS has touted NCTracks’ success, saying, despite some bugs (which are to be expected), NCTracks has done great.

What about the dentists?