Rural Hospital Presentation - HCCA Official Site
Transcript of Rural Hospital Presentation - HCCA Official Site
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Rural Hospital Compliance
What Happened to the Simple Life?
Kirk Ruddell, CHCHCCA Audio Seminar
February 23, 2006
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Island Hospital Anacortes, WA44-bed hospital and 2 clinicsHome Health agency100 community providers475 employees (330 FTEs)Pediatrics, ophthalmology, optometry, oncology, OB/GYN, cardiology, orthopedics, dermatology, respiratory medicine, psychiatry, urology, IP/OP surgery, sleep medicine, sports medicine
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Island Hospital (cont.)
Level III emergency departmentRehab (PT, OT, speech therapy)Birth CenterCancer Care CenterSleep Disorders CenterCardiopulmonary RehabDiagnostic services – X-ray, CT, US, mammo, MRI, arteriography, NM, full-service lab
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AUDITING AND MONITORING WORKPLAN
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OIG Work Plan FY 2006
Inpatient-only services in an outpatient settingOutpatient surgeriesUnbundling of hospital outpatient servicesCritical Access Hospitals – cost reportsPurchasing rebates and cost reportsMedicare Part B radiology payments for inpatientsGround ambulance services
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OIG Compliance Program Guidance for Hospitals
Billing for items or services not actually renderedProviding medically unnecessary servicesUpcoding“DRG creep”Inpatient-only services in an outpatient settingDuplicate billingFalse cost reportUnbundlingBilling for discharge in lieu of transfer
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OIG Compliance Program Guidance for Hospitals (cont.)
Patients’ freedom of choice Credit balances – failure to refundIncentives that violate the anti-kickback statute (AKS)Joint venturesFinancial relationships between hospitals and hospital-based physiciansStarkEMTALA
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OIG Supplemental Compliance Program Guidance for Hospitals
Substandard care and billingHIPAABilling “substantially in excess” of usual chargesDiscounts to uninsured patientsGifts and gratuities to patientsCardiac rehab billingCompensation arrangements with physiciansPhysician recruitmentOutpatient codingGainsharing arrangements
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Comprehensive Error Rate Testing Program (CERT)
“Federally mandated program to monitor and improve the accuracy of Medicare payments to providers”Documentation requests on “randomly selected” claimsNot really helpful, unless outliers identified
“Probe notification”40 more claims
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Hospital Payment Monitoring Progam(HPMP)
Generates a report called “PEPPER” (Program for Evaluating Payment Patterns Electronic Report)Summary statistics of claims with comparison to other hospitals in stateVery useful for pinpointing auditing areasNot a report of claims errorsMay not be universally available as state QIOsnot required to release itSee PEPPER example
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How Do I Choose?
Risk AssessmentAddress areas of greatest risk first
See Health Care Compliance Professional’s Manual, “Risk Assessment in Small Hospitals“
See workplan example in handouts
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RURAL HEALTH CLINICS (RHCs)
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RHC Requirements
Location in:Rural or non-urbanized area as defined by Census Bureau, orA Federal Health Professional Shortage Area (HPSA), orA Medically Underserved Area (MUA)
ClassificationProvider-based (hospital, SNF, home health agency)Free-standing
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RHC Requirements (cont.)Staffing
At least one mid-level (NP, PA, CNM) must be available to see patients 50% of the time clinic is openWaiver available
One year if unable to hire mid-level in previous 90-day periodOne exception
On-site physician at least every two weeksOther requirements
On-site servicesArrangements for services not provided on-sitePolicies and procedures
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RHC Reimbursement AdvantagesFree-standing
Cost-basedCapped at $70.78 per encounterCoding of visits still advised
Provider-basedSame as free-standing, plusHospital overhead included in costsNo cap on encounter if hospital < 50 beds
Critical Access Hospital-basedSame as provider-based but same physician can cover hospital ED
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Conversion to RHC Status
Hire consultant familiar with RHC conversionsTime frame
Inquiry to effective billing date – about one year
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Provider-based RHC Challenges72-hour rule
Normally involves ancillary servicesIf provider-based, office visits must also be bundled
Mid-level provider available 50% of the timeException – clinics located on an island
Hospital control must be substantialQA requirements
Medical staff committees responsible for QA, UR, and coordination and review of clinic services “to the extent practicable”
Changes from rural to “urban” MSAMay still qualify as HPSA or MUA
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MEDICARE SECONDARY PAYER (MSP)MEDICAL NECESSITY
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MSP Questionnaire (Black Lung Form)Ensures that Medicare is not the primary payer if another payer should beBlack lung benefitsGovernment program or research grantDepartment of Veteran’s AffairsWork- or accident-relatedDisabilityKidney transplant/End Stage Renal Disease (ESRD)Former employer/current spouse or parent health planQuestions must be asked at each IP and OP admissionCopy of our MSP form in handouts
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Medical Necessity – History Medicare will only pay for tests that are “medically necessary”Physicians who order and those who perform services, procedures, tests are equally responsibleHospitals should make an effort to collect payment for “unnecessary” testsPrimary mechanism is Advance Beneficiary Notice (ABN)Some hospitals/labs tried to bill physician if patient could not be billed
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Medical Necessity History (cont.)
Medicare past:Writing off all charges with no effort to collect = kickback to patientCompliance issue
Medicare present:Not mandatory, but “best practice”If you don’t want to get paid, that’s your business!Reimbursement issue
Pendulum could swing back other way
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Medical Necessity – Our ApproachCurrently using a manual system
Checking notebooksCumbersome, time-consuming and inaccurateLosing ~ $400,000 per year in charges
SoftwareChecks all tests against all diagnosesMuch faster, more efficientPrints “custom” ABN for patient to sign
Three options:Agree to pay if Medicare does not and sign ABN, or;Decline to pay and not have tests performed, or;Decline to pay and have the tests done anyway
Cost of the software paid in three monthsCopy of our current ABN in handouts
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HOME HEALTH
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Home Health Compliance Concerns
Physician orders match actual visits and actual visits match billingHomebound statusHome Health Beneficiary Notices Initiative (BNI)
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Home Health Beneficiary Notices Initiative (BNI)
Effective October 1, 2005Requires notification of a Medicare home health patient:
Within 2 days or 2 visitsThat visits ordered will run out and they will no longer be eligible for Medicare coverage
Form outlines options and patient’s right to appealA copy of our form is included in the handouts
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CARDIAC REHABILITATION
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Cardiac Rehab Issues
Physician supervisionMust be “available” during exercise
“Incident-to” billingPhysician professional services required
OIG auditMost hospitals fell shortBut no repayment demanded
Requirements are very subjective
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Cardiac Rehab – Our ProgramPhysician supervision
Located on 2nd floor of same buildingIncident-to
Progress report on each patientBaselineMidway through programOne month post graduation
Form is faxed to PCP and cardiologistProgress report form is in your handouts
Pending issuance of NCD:Policies and procedures up to date and followedDocument, document, document!
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COST REPORTS
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Cost Reports – A “Snooze Fest”?Not to the OIG!Used to report your hospital’s actual cost of doing businessPrevious – cost-based reimbursement
If costs exceeded what Medicare paid, you received a check
Now – DRGs and APCsStatisticsRate of reimbursement based on complexity and wage index
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Cost Reports – Wage IndexCalculated using total wages and total hours workedPivotal in determining payment rates for MSA
Inaccuracy can inflate or deflate rates for other hospitals as well as your own
CMS discovers careless reportingOIG conducted several cost report audits of wage index dataA couple of things to look at:
Compare wage index data from year to yearTalk to staff about changes resulting from Medicare adjustments
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Cost Reports - Rebates
Fiscal intermediaries (FIs) expect hospitals to pass rebates savings on to MedicareMust be reported as separate line itemHard to track because rebates can come from many different areasWork with cost report staff to ensure that rebates are accounted for properly
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Loss of Transitional Corridor Payments (TCP)
Rural hospitals < 100 beds and sole community hospitals received TCP effective August, 2000Terminated 12/31/05Compensate for revenue loss in move from cost-based to OPPS reimbursementLarge payments made prospectively and excess paid back on cost reportImpact for many hospitals will be minimal
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OBSERVATION VS. INPATIENT
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Common Handling of Observation (OBS) Status
Physician admits to a level of care by checking off a boxCare Management or Utilization Review applies a set of criteria (e.g. InterQual)If physician order differs from criteria, care manager asks physician to change orderResult:
Physician writes new orderPhysician yells at care managerBoth
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Physician PerceptionMost physicians have no idea what observation means
Medicare vs. Managed Care vs. Medicaid
For patients it means:Different careDifferent setting
For the physician it means different reimbursementNONE OF THESE CONCERNS ARE ACTUALLY TRUE!
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Observation Facts
Any bed in the hospital can be considered an observation bed for MedicareYou do not need a special OBS unitPatient gets same services either wayIP and OBS are statuses for claims and billing, NOT patient careBottom line: Same service, same bed, same physician reimbursement
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Transmittal 299, Change Request 3444 – The Facts
September 10, 2004Effective 4/1/04Implemented 10/12/04
Status changes from IP to OBSPrior to dischargeIP claim not submittedPhysician concurs with URConcurrence documented on chart
Condition Code 44 must go on claim
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Transmittal 299, Change Request 3444 – The Fallout
Lack of UR 24/7 leads to write-offs, orFalse claims!CMS practically guaranteed that all claims with Condition Code 44 would be auditedAHA has recommended that CMS revise requirements
Notify admitting physician of status change and documentNo response yet from CMS
How to deal with this?
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Our ApproachChanging OBS to IP requires only a physician’s order
CMS regulations do not prohibit change after discharge
Admit to appropriate status when clearAdmit to OBS when it’s not clear (50%+)Result:
Every chart is reviewed by care managementThose meeting IP criteria were changed, even after dischargeVery few Condition Code 44Very few write-offs
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A New Approach – Physician Advisor
InterQual is only a screening toolPhysician Advisor works with UR staffPatients normally classified as OBS using InterQual only are now placed into IP status with proper documentationAverage daily reimbursement for one day stay:
IP = $5,100OBS = $400
May be the ideal solution to maximize reimbursement and minimize compliance riskOne hospital’s experience – 10:1 ROI!
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MISCELLANEOUS TOPICS
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Board ReportingOIG CPGs and the Federal Sentencing Guidelines stress that the governing body and senior management must:
Set the tone for compliance programsBe knowledgeable about the programExercise reasonable oversightBe actively involved
Report quarterly to Finance CommitteeAuditing and MonitoringInvestigationsMiscellaneous compliance activities
An example of my report is included in the handouts
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Compliance Rewards and Incentives“Recommended” by FSGOMonthly newsletter
ArticleCompliance quizRiddles, brainteasers, etc.
First three people with 100% on quiz get a free lattePromotes interest in complianceAn example of one of our newsletters is included in your handouts
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Modifiers -25 and -59NCCI edits are designed to block payments when services should be bundledModifiers allow overriding of NCCI edits for legitimate reasonsCan be (and are!) misusedModifier 25
Used to bill for both a procedure and a “separately identifiable” E&M serviceOIG audit – 35% did not meet criteria $538 million in Medicare overpaymentsReview clinics and ER
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Modifiers -25 and -59 (cont.)Modifier 59
Overrides certain NCCI code pairsUsed for service on same day but different session, site, etc.OIG audit – 40% were billed incorrectly $59 million in improper Medicare payments
See decision tree in handoutsSee also Report on Medicare Compliance, 1/16/06
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How To CopeDon’t try to do it all at onceDon’t try to do it by yourself
Cultivate collaborative relationships
Educate your CEO and BoardMake a case for increased resources
The OIG acknowledges and recognizes:The difference between large and small hospitalsThat small hospitals may have limited resources
Compliance programs can be affordable, supportable, and relevant to available resources
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Contact Information
Kirk Ruddell, CHCCompliance Officer
Island Hospital1211 24th Street
Anacortes, WA 98221(360) 299-1366