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Last month we wrote about Saint Thomas Hospital in Nashville, TN being the first hospital that the Office of Inspector General (OIG) extrapolated their Medicare Compliance Review findings. Since then they have done it again. This time Baptist Medical Center South in Montgomery, Alabama was subjected to extrapolation. This resulted in an increase in their amount to be refunded from an initial $242,514 to $1,784,982.  

OIG Medicare Compliance Reviews by the Numbers:

In addition to extrapolating findings what else is occurring in these Medicare Compliance Reviews?

After completing an extensive review of all reviews to date, here is a list of interesting facts by the numbers:

• One: The number of hospitals with no identified overpayments during a review
• Regional Medical Center at Memphis, Tennessee
• One: The number of hospitals where the OIG identified overpayments as well as potential underpayments to the hospital during the review.
• University of Alabama Hospital at Birmingham, Alabama
• Two: The number of hospitals who have now had their Medicare Compliance Review Findings extrapolated.
• Saint Thomas Hospital in Nashville, Tennessee, and;
• Baptist Medical Center South in Montgomery, Alabama
• Three: The number of hospitals that have been revisited for additional reviews by the OIG.
• Fletcher Allen Health Care, Inc. in Burlington, Vermont,
• Boston Medical Center in Boston, Massachusetts; and
• Tufts Medical Center in Boston, Massachusetts.
• Eleven: The highest number of hospitals within a single state to undergo an OIG Medicare Compliance Review (Massachusetts).
• Twenty-Six: Number of states that have had at least one hospital subject to an OIG Medicare Compliance Review.

• Sixty-Three: The total number of Medicare Compliance Reviews completed and reported on the OIG website as of July 17, 2013.
• Eight in 2011, Thirty-Nine in 2012 and Sixteen thru July 17 of 2013
• $12,222: The lowest overpayment amount identified to date was at Sanford University of South Dakota Medical Center.
• $2,244,649: The highest overpayment amount identified to date was at Cedars Sinai Medical Center. Note, this amount was not an extrapolated amount.
• $26,979,529: The amount identified as overpayments for all hospitals to date requiring payback to the Contractor without extrapolation being applied.
• $29,420,885: The amount identified as overpayments for all hospitals to date requiring payback to the Contractor with extrapolation being applied to Saint Thomas and Baptist Medical Center South.

Has Your Hospital Been Subject to an OIG Medicare Compliance Review?

Clicking the link below will show a table of all Medicare Compliance Reviews displayed on the OIG website to date. This table includes a link to the OIG reports, the “risk areas” looked at in the audit and the amount the OIG recommended the hospital refund.

OIG Medicare Compliance Reviews as of July 17, 2013

This material was compiled to share information. MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.

Medicare’s Recovery Audit program affords a variety of ways for hospitals to lose money. But it makes it harder to accept when you don’t have a process to deal with the issues. In this article we look at an inpatient issue that offers such challenges.

When we think of Recovery Auditor reviews of hospital inpatient records, we normally think of DRG Validation reviews and the ever-so-popular Medical Necessity reviews. But the Recovery Auditors also review inpatient records for other issues.

The topic addressed here is actually several different issues, all dealing with the correct assignment of the patient’s discharge disposition status. These include:

• reviews of acute care hospital to hospital transfers receiving an overpayment due to the assignment of an incorrect discharge status code,
• reviews of overpayments when a patient receives post-acute care but is coded as a discharge to home, and
• underpayment reviews for patients coded as a transfer to a post-acute care setting who never actually receive post-acute care.

Some of the errors may be the result of an error in code assignment, but a lot of these are due to either incomplete documentation concerning the patient’s post-discharge plans or circumstances that change after the patient is discharged.

So what can a hospital do to prevent receiving an improper payment, either over or under? First make sure physicians, case managers and discharge planners document clearly in the medical record the plans for the patient post-discharge. Also develop an avenue for coders to follow up on discharge status if the documentation in the record is unclear or conflicting. Now the harder part is how to address those patients that do not end up where they were planned to go. Some hospitals have implemented systems to verify the actual post-discharge care the patient receives. Examples of this would be contacting patients scheduled to begin home health care after discharge to see if this actually occurred or contacting skilled nursing facility to see if the patient was actually admitted. Medicare recently addressed post-acute care transfer underpayments in an MLN Matters article, SE1317.

This can be a difficult issue and contains financial risks for hospitals. Hopefully, being aware of what the issues are, understanding the regulations and having a plan in place will help reduce risks for hospitals.

This material was compiled to share information. MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.

Saint Thomas Hospital in Nashville, TN has the unique or unfortunate distinction of being the first hospital that the Office of Inspector General (OIG) has extrapolated their Medicare Compliance Review findings. Through extrapolation the payback amount to the Medicare Administrative Contractor increased from $293,359 for the actual records reviewed to an extrapolated amount of $1,092,248.

Background of OIG Medicare Compliance Reviews:

The mission of the OIG is mandated by Public Law and “is to protect the integrity of the Department of Health and Human Services (HHS) programs, as well as the health and welfare of beneficiaries served by the programs. This statutory mission is carried out through a nationwide network of audits, investigations, and inspections conducted by” the Office of Audit Services, Office of Evaluation and Inspections, Office of Investigations and Office of Counsel to the Inspector General.

Hospital specific Medicare Compliance Reviews are performed to review Medicare payments to hospitals for selected claims for inpatient and outpatient services.

The OIG has indicated that they identify claims at risk for noncompliance through computer matching, data mining, and analysis techniques. Examples of risk areas include:

• Inpatient short stays,
• Inpatient claims billed with high severity level DRG codes,
• Inpatient claims pain in excess of charges,
• Inpatient same-day discharges and readmissions,
• Inpatient and outpatient manufacturer credits for replaced medical devices, and
• Outpatient claims with payments greater than $25,000.

Saint Thomas Compliance Review Findings and Recommendations:

In this review, the OIG found that the Hospital complied with Medicare billing requirements for 206 of 250 claims reviewed and that the remaining 44 claims resulted in $293,359 in overpayments to the Hospital. Reasons identified resulting in overpayments included the following:

• Billing claims as Medicare Part A that should have been billed as outpatient or outpatient with observation services,
• Incorrect DRG code assignment,
• Incorrect reporting of medical device credits,
• Billing separately for related discharges and readmissions on the same day; and
• Incorrect HCPCS code assignment.

Complete details can be found in the Medicare Compliance Review of Saint Thomas Hospital for Calendar Years 2009 and 2010.

The OIG made two recommendations:

• First, that the Hospital refund $1,092,248 in estimated overpayments; and
• Second that the Hospital strengthen controls to ensure complete compliance with Medicare billing requirements.

 

Saint Thomas Says:

Saint Thomas indicated that they were not made aware until “towards the end of the audit process that the sample was statistical and the findings would be estimated.”

Saint Thomas disagreed with the recommendation to refund the $1,092,248 in estimated overpayments and indicated in their comments that “in reviewing the Medicare Compliance Reviews audit reports the OIG has issued in the past two years, all of them were based on a “judgmental” sampling methodology. In some cases, it was noted that some hospitals had no extrapolation even though their overpayment audit results appeared to exceed those of STH.”

Further complicating the OIG findings Saint Thomas found that their “sample frame included several claims that the Recovery Audit Contractors (RAC) had also reviewed. The Hospital believed that including RAC claims in our sample frame, especially claims that the Hospital had already repaid, would result in the Hospital repaying Medicare twice.”

Ultimately, Saint Thomas indicated that they did not agree with the sampling methodology but would make any final payment necessary as a result of the statistical sampling.

The OIG Says:

The OIG indicated “at our entrance conference on June 26, 2012, we informed the Hospital that we would use statistical sampling techniques to select claims for review. In addition, during the course of the audit, we discussed with a Hospital official our plans to “project” the sample results across the population.” Additionally, they indicated that “as this hospital compliance review initiative has matured, we have refined our audit methodologies. Some reviews are statistical sampling and estimation techniques to draw conclusions about a larger portion of a hospital’s claims while other reviews are judgmental sampling. Each hospital review is unique, and the sampling method used in each of these reviews will vary.”

The OIG indicated that they did identify claims in the sample under RAC or Department of Justice (DOJ) review and as such these claims were considered “non-errors.”

Ultimately, the OIG maintained that Saint Thomas should pay bay the $1,092,248 in estimated overpayments.

Key Takeaways for our Clients:

• Be involved with the OIG staff from the beginning of an audit to understand the sampling techniques that will be used,
• Be aware of the potential “risk areas” identified by the OIG and internally assess for potential break-downs in processes; and
• Be aware that the days of paying back overpayments for only the claims reviewed appears to no longer hold true.

 

 

 

Please share this article with the therapists at your facility.

In last week’s Wednesday@One, we discussed therapy documentation in the evaluation, re-evaluation, plan of care, and certification. This week we will note some potential areas of improvement for therapy documentation in the daily treatment notes, progress notes, and the discharge summary. Like last week, we encourage providers to review the

Daily Treatment Notes

• Daily notes should list each specific intervention/modality provided to the patient for both timed and untimed codes.
• Medicare requires that the treatment notes include the total treatment time in minutes (includes both timed and non-timed codes) and the total minutes of the timed codes. Therapists need to know which treatments are timed codes and which are non-timed codes.   Non-timed codes are reported as one unit per day while the total number of units allowed for timed codes is restricted by the total timed code treatment minutes. For example if a patient receives 10 minutes of therapeutic exercise, 10 minutes of neuromuscular re-education and 10 minutes of manual therapy, the total timed code minutes equals 30 minutes which is 2 units. This patient may have also received 20 minutes of unattended electrical stimulation; this is included in the total treatment time for a total of 50 minutes, but does not affect the calculation of timed code units since it is an untimed code.
• Units of timed codes are based on the following time scale:
• 8-22 minutes = 1 unit
• 23-37 minutes = 2 units
• 38-52 minutes = 3 units
• 53-67 minutes = 4 units, etc.
• The therapy professional(s) providing the treatment must sign the treatment note and include their credentials.
• Extra documentation in the daily notes, though not required, often helps to support medical necessity in case of a Medicare audit. This may include noting the patient’s response or any assistance / instruction the patient required. If pain is part of the patient’s functional deficit, a numeric evaluation or discussion of the patient’s pain is recommended.
• Some LCDs list specific requirements for certain therapy services. For example, Cahaba’s Physical Therapy LCD notes that the medication and dosage information is required for iontophoresis and, for manual therapy, the area(s) being treated and the soft tissue/mobilization technique used should be documented. Be sure to review your Medicare contractor’s coverage policies for any additional documentation requirements.

Interval Progress Notes

• After the evaluation, this is the most important documentation in supporting the medical necessity of the therapy services provided. Based on our reviews of therapy records, most progress reports consistently contain all of the required elements.
• These notes must include objective measurements that describe the patient’s current function. Note that under the new functional limitation reporting requirements, the patient’s function will be reported as a percentage of impairment which must be documented in the patient’s record.
• Progress notes that allow easy comparison of the patient’s initial status and the status at last progress interval to the current status make auditing the record easier. The original and any revised goals need to be listed or referenced by a numbering system and the patient’s progress toward each goal noted.
• The clinician must document an assessment of the patient’s progress or lack of progress. Clearly explain if the patient is on target, ahead of schedule or not progressing as expected including reasons, adjustments to treatments / goals and recommendation for continuation of treatment. Remember this is where the therapist makes his/her case for the medical necessity of continuing treatment.

Discharge Summary

• A discharge note or summary is required for each episode of outpatient treatment.
• It covers the period from the last progress note to the date of discharge.
• In the case of an unanticipated discharge, the therapist uses the daily treatment notes and verbal reports from the treating assistants to make judgments for the summary.
• The discharge note requires the same elements as an interval progress note and is the last opportunity to justify the medical necessity of the entire treatment episode in case the record is reviewed.

When documenting therapy services, remember that you are presenting a “story” to justify that

1. the patient has a condition for which therapy should be beneficial,
2. the services require the skills of a therapist, and
3. the services are appropriate for the individual needs of this particular patient.

On Friday May 17, 2013, the Centers for Medicare and Medicaid Services (CMS) released a memorandum to State Survey Agency Directors containing revisions to Appendix A – Interpretive Guidelines for 42 CFR 482.43, Discharge Planning. The memorandum instructs that the revisions are effective immediately.

Under §482.43 Condition of Participation: Discharge Planning the revisions indicate that “reducing the number of preventable hospital readmissions is a major priority for patient safety, and holding hospitals accountable for complying with the discharge planning CoP is one key element of an overall strategy for reducing readmissions.”

Within this 39-page document are Advisory Boxes that “display successful practices currently found throughout the industry in the area of care transitions.” The Advisory Boxes are not hospital compliance requirements rather suggestions for process improvement. One Advisory Box provides examples of patient discharge planning tools that includes the following links:

• Medicare’s “Your Discharge Planning Checklist” (available at http://www.medicare.gov/publications/pubs/pdf/11376.pdf,
• Agency for Healthcare, Research and Quality’s (AHRQ) “Taking Care of Myself: A Guide for When I Leave the Hospital” (available at http://www.ahrq.gov/patients-consumers/diagnosis-treatment/hospitals-clinics/goinghome/goinghomeguide.pdf; and
• Consumers Advancing Patient Safety (CAPS) “Taking Charge of Your Healthcare: Your Path to Being an Empowered Patient Toolkit” (available at http://www.patientsafety.org/page/transtoolkit.

This memorandum also provides clarification for providing a patient list of available Home Health or Skilled Nursing Facilities. (See Survey Procedures §482.43(c)(6), §482.43(c)(7) & §482.43(c)(8):

• “Review a sample of cases of patients discharged to HHAs or SNFs to determine if, when applicable, the hospital provided the patient with lists of Medicare-participating HHAs or SNFs. In making this determination:
•  Is there documentation of a list of multiple HHAs or SNFs being provided (including electronically) to the patient? If not, is there documentation for an acceptable rationale for providing only one option, e.g., the patient’s home is included in the service area of only one Medicare-participating HHA that requested to be included on hospital lists, or there is only one Medicare-participating SNF in the area preferred by the patient?
• Ask to see examples of lists of HHAs and SNFs provided to patients prior to discharge.”

MMP, Inc. encourages Case Management and Discharge Planning Staff to review the entire memorandum at: http://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertificationGenInfo/Downloads/Survey-and-Cert-Letter-13-32.pdf

 

Please share this article with the therapists at your facility.

With all of the new Medicare requirements for rehabilitative therapy, such as functional limitation reporting, cap amounts applied to hospital outpatient services, and manual medical review of therapy services exceeding the threshold, we thought now would be a good time to address therapy documentation. These Medicare requirements can be found in the Medicare Benefits Policy Manual, chapter 15, section 220.3. Also most Medicare Administrative Contractor shave local coverage determinations for therapy services that include additionald ocumentation requirements.

The Medicare Benefits Policy manual details the minimum documentation requirements for therapy services. They also list documentation elements that are “encouraged” though technically not “required.” But this is a catch 22 –therapy documentation must be sufficient to support the medical necessity of the services provided. The manual states, “It is encouraged but not required that narratives that specifically justify the medical necessity of services beincluded in order to support approval when those services are reviewed.” So, like Medicare, we encourage providers to cover their bases with the amount and type of therapy documentation.

We are not going to re-list all of the documentation elements that Medicare recommends to support therapy services. Most therapists are well aware of the documentation requirements but we recommend providers carefully review the Medicare Benefits Policy Manual and any therapy LCDs for their jurisdiction for complete documentation information. We are going to discuss a few elements we have identified during therapy audits that we believe have potential for improvement. This week we will address documentation in the therapy evaluation, re-evaluation, plan of care and certification.

Evaluation

• Onset date – this is usually documented on the evaluation/certification form though the exact onset date is often hard to pin down. Our recommendation involves chronic conditionsa nd those conditions with an insidious onset. To support medical necessity, we recommend the evaluation answer these questions - If this condition has been going on for a while, why is therapy needed now? Has there been a recent decline in function, increase in pain or stiffness, increase in number of falls, or an exacerbation of the condition,etc.? Is the therapy intended to improve function or prevent further decline? Documentation that clearly addresses these questions helps to support the medical necessity of the therapy services.
• ADLs, ADLs, ADLs – The evaluation will include the patient’s functional deficit with objective measurements, but discussing the patient’s prior function and current limitations in terms of activities of daily living helps to support the medical necessity of the planned therapy. It is great to know the patient has limited mobility or restricted range of motion, but understanding the patient is unable to go grocery shopping or dress themselves is more dramatic and convincing of the need for treatment.

Plan of Care

• ADLs Again – In addition to the objective measures in the goals, linking the goals to improvement in a particular activity of daily living makes the goal more meaningful to the patient and to an outside reviewer.
• The functional impairments identified and expressed in the long term treatment goals must be consistent with those used in the claims-based functional reporting, using non-payable G-codes and severity modifiers.

Re-evaluation

• Continuous assessment of the patient's progress is a component of ongoing therapy services and is not payable as a re-evaluation.
• Re-evaluations are indicated when there are new clinical findings, a significant change in thepatient's condition, or failure to respond to the therapeutic interventionsoutlined in the plan of care.

Certification

• Certification requires a dated signature on the plan of care or some other document that indicates approval of the plan of care. Make sure the signature of the certifying practitioner is dated and be sure to include a copy of the signed certification when submitting records for external review. Medicare may deny services if a signed certification if not available in the medical records submitted for review.
• Let’s discuss timing of the certification -Certifications should be obtained as soon as possible after the plan of care is established or at least within 30 days of the initial treatment. Certifications are acceptable without justification for 30 days after they are due but certifications delayed beyond this time frame should include evidence to justify the delay.Evidence that the provider made immediate and on-going attempts to obtain the certification signature should be included in the record. Note however that delayed certifications are accepted by Medicare unless the contractor has reason to believe that there was no physician involved in the patient’s care, or treatment did not meet the patient’s need (and therefore, the certification was signed inappropriately).

Next week, we will look at daily treatment notes, progress notes, and the discharge summary.

 

CMS has released the April 2013 Medicare Quarterly Provider Compliance Newsletter. As a reminder, this newsletter is an educational product to assist providers in understanding audit findings identified by Contractors such as Medicare Administrative Contractors (MACs), Recovery Auditors (RAs), Comprehensive Error Rate Testing (CERT) contractors and the Office of Inspector General (OIG).

This edition of the newsletter addressed several findings related to the review of Inpatient hospital claims. Specifically, findings are provided for review of the following MS-DRGs:

• Neoplasm Surgery (MS-DRGs 826, 827, 828, 829, 830, 834, 835 and 836)
• Pancreas, Liver & Shunt Procedures (MS-DRGs 405, 406 and 407)
• Medical Necessity for respiratory neoplasms with a complication or co-morbidity (CC) (MS-DRG 181),
• Esophagitis, Gastroenteritis, and Miscellaneous Digestive Disorders with MCC (MS-DRG 391); and
• Acute Inpatient Hospitalization – Signs and Symptoms without MCC (MS-DRG 948)

 

Examples of review findings include:

• Incorrect selection of the Principal Diagnosis, reminding providers that “the circumstances of inpatient admission always govern the selection of principal diagnosis” and “is defined in the Uniform Hospital Discharge Data Set (UHDDS) as that condition established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care.”
• High percentage of coding errors, reminding providers that “DRG validation requires that diagnostic and procedural information and the discharge status of the beneficiary, as coded and reported by the hospital on its claim, match both the attending physician description and the information contained in the beneficiary’s medical record.”
• Medically unnecessary inpatient hospitalizations, reminding providers that:

1. “Medicare pays for inpatient hospital services that are medically necessary for the setting billed. The Medicare Benefit Policy Manual, Chapter 1, Section 10, states that the physician or other practitioner responsible for a patient’s care at the hospital is also responsible for deciding whether the patient should be admitted as an inpatient.”
2. “The Medicare Integrity Program Manual, Chapter 6, Section 6.5.2.A, states that inpatient care is required only if the patient’s medical condition, safety or health would be significantly and directly threatened if care were provided in a less intense setting.”

 

The following table is being provided to help you identify which MACs and RAs have currently targeted the MS-DRGs from this newsletter. A review of the specific examples and findings can afford you the proactive opportunity to ensure your records are coded accurately and that the hospitalizations were medically necessary.

On March 13, 2013, CMS released a Ruling and a Proposed Rule that changes Medicare’s existing policy and allows payment of all Part B hospital services that were furnished and would have been reasonable and necessary if the patient had been treated as an outpatient, rather than admitted as an inpatient, except for those services specifically requiring an outpatient status. CMS also released Change Request 8185 with billing instructions for Part B rebilling to be implemented July 1, 2013 and discussed the Part B rebilling rules on the April 2 Hospital Open Door Forum call. But even with all this information, there are parts of the new rules that remain somewhat confusing. We thought we would address some questions to hopefully clear some of the confusion. Note that more information is expected from CMS soon and we will do our best to keep you up to date.

What services go on the Part B outpatient claim (13x type of bill) and what services go on the Part B inpatient claim (12x type of bill)?

Outpatient services that were bundled into the Part A inpatient claim under the 3-day payment window rule can be separately billed on an outpatient claim (13x TOB) if the inpatient admission is determined to be not reasonable and necessary. Therefore services that were provided before the inpatient order was written would be on the 13x claim.

Part B services that were provided after the patient was admitted (after the admission order was written) would be eligible to be billed on the Part B inpatient claim (TOB 12x). Services that require an outpatient status, such as ER services and observation services, would not be provided after the inpatient admission order was written, so these types of services are not allowed on the 12x claim.

 

When can claims for Part B rebilling be submitted?

The Ruling was effective March 13, 2013 but Medicare has to work out the details of claims submission and allow the processing contractors time to put changes in place to accept the claims. Medicare published CR 8185 with billing instructions, but this CR will not be implemented until July 1, 2013. CMS has promised interim billing instructions to be released soon. Once these interim instructions are released, Part B rebilling claims can be submitted.The interim billing instructions are now available at http://www.cms.gov/Center/Provider-Type/Hospital/Other-Content-Types/Quick-Reference-CMS-1455-R.pdf

 

Which previously denied claims are eligible for rebilling?

The ruling applies to claims denied after March 13, 2013, claims with pending appeals, and claims denied prior to March 13th that are still within the appeals timeframe. On the latter point, if claims were within the appeals timeframe as of March 13th, do they remain eligible for rebilling even when they are beyond the appeals timeframe? As providers wait on billing instructions from CMS, claims that were still eligible for appeal as of March 13th will have their appeals timeframe expire. But in listening to the Hospital Open Door Forum, CMS’s comments seem to indicate that these claims would remain eligible for rebilling until the 180 days post denial date. CMS even indicated that denials from November 8, 2012, which is 125 days prior to March 13th (120 appeals timeframe plus 5 mailing days) would be eligible for rebilling under this rule until May 7, 2013 (180 days from 11/8/12). This means that providers would not have to appeal previously denied claims to maintain their billing rights under the Ruling. This gives CMS some time to develop billing instructions without impacting providers’ rebilling opportunities.

 

Can rehabilitative therapy services be included on a Part B inpatient claim?

Under current regulations, outpatient therapy services (PT, OT, and SLP services) are included in the list of “Part B only” services and may be billed on a Part B inpatient, 12x type of bill. Billing of therapy services will also be allowed under the Ruling. But, in the proposed rule for Part B rebilling, Medicare notes such “therapy” services are defined in section 1833 (a) (8) of the Act as outpatient services. Since “services specifically requiring an outpatient status” are not allowed to be billed on an inpatient claim under the proposed rule, rehabilitative therapy services (physical therapy, occupational therapy, and speech language pathology services) cannot be billed on the Part B inpatient claim once the proposed rule is finalized. So any therapy services that are provided to the patient after he/she is admitted will not be billable, unless Medicare further modifies the policy.

 

 

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It has been just over three years since the Affordable Care Act (ACA) was signed into law on March 23, 2010. This slide provided by the Kaiser Family Foundation Health Tracking Polls, polled people on their view of the health reform bill based on what they know about it. As you can see, there are very mixed views.

To test what you know about the health reform law you can go to the Kaiser Health Reform quiz at this link: http://healthreform.kff.org/quizzes/health-reform-quiz.aspx

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On March 13, 2013, CMS released a ruling (Ruling 1455-R) with a HUGE impact for hospitals. This ruling is in light of the numerous recent appeal decisions by Administrative Law Judges (ALJs) and the Medicare Appeals Council to allow payment for Part B services when an inpatient admission is determined to not be medically necessary. This interim ruling is effective immediately and remains in effect until the corresponding proposed CMS rule entitled, "Medicare Program; Part B Billing in Hospitals" is finalized. Note that there are differences in the requirements of the ruling versus the proposed rule. This article discusses the currently effective Ruling only.

The Ruling allows hospitals to bill and receive payment for all reasonable and necessary Part B services provided to a hospital inpatient when a Medicare review contractor denies the Part A inpatient admission as not reasonable and necessary.

On Friday, March 22, 2013, CMS released Transmittal 1203 (CR 8185) which details the claims requirements for Part B rebilling. Although this transmittal is effective March 13, 2013, the implementation date is not until July 1, 2013. Therefore, hospitals cannot bill under the instructions of CR 8185 until July 2013. Further instructions from Medicare regarding billing in the interim are expected to be released soon. As indicated in our Extra newsletter yesterday, if you have a denied claim that has not been appealed and is approaching the end of the appeal timeframe, you should appeal the claim now in order to reserve your right to request a dismissal and bill under Part B once the billing instructions are released.

The key points from the Ruling are: 

• The ruling applies to
• Inpatient denials on or after the date of this ruling (March 13, 2013),
• Prior inpatient denials still within the appeal timeframe or
• Prior inpatient denials with an appeal pending.
• The ruling does not apply to
• Prior inpatient denials if the timeframe to appeal has expired, or
• Inpatient admissions determined by the hospital to not be medically necessary, such as during UR or other internal review.
• Hospital may submit a Part B inpatient claim for all reasonable and necessary Part B services that would have been payable if the patient had been treated as an outpatient –
• It is not limited to “Part B only” services described in Medicare Benefit Policy Manual, Chapter 6, Section 10. Prior to this ruling, a hospital could only bill selected services on a 12x type of bill when an inpatient admission was not allowed. These services are referred to as “Part B only” services, are listed in the policy manual referenced above, and include mostly laboratory tests and imaging studies. They did not include therapeutic services such as drug administrations, surgery, or therapeutic coronary or peripheral interventions. Under the Ruling, these types of services will be allowed to be billed on the Part B inpatient claim if the Part A stay was denied as not medically necessary by a Medicare contractor.
• Outpatient services that require an outpatient status, such as outpatient visits, ER services, and observation services may not be submitted on the Part B inpatient claim. These types of services may occur immediately prior to the inpatient admission and can be billed on an outpatient claim (see next bullet point regarding the 3-day window). Only Part B services occurring during the inpatient admission (i.e. after an inpatient admission order) would be included on the Part B Inpatient claim.
• Reasonable and necessary outpatient services provided during the 3-day payment window prior to inpatient admission may be billed separately on an outpatient claim if the inpatient admission is denied as not medically necessary. This ruling allows billing of this outpatient claim beyond the usual timely filing restrictions in accordance with the time frames listed below.
• The hospital may not have simultaneous requests for both Part A and Part B payment:
• The hospital must withdraw any Part A appeals in order to submit Part B claims for the same services.
• The hospital may not initiate a Part A appeal after submitting a Part B claim for the same services.
• The Part B billing may occur past normal timely filing limitations as long as it is:
• Within 180 days from the date of receipt of an appeal dismissal notice or,
• Within 180 days from the date of receipt of a final denial decision or,
• Within 180 days from the from the date of receipt of the initial or revised determination on the Part A inpatient claim (that is, the date of the remittance advice).

(Note the date of receipt of an initial or revised determination, or an appeal decision or dismissal notice is presumed to be 5 days after the date of such notice or decision, unless there is evidence to the contrary.)

• For the Part B claims billed under this Ruling, the beneficiary's patient status remains inpatient as of the time of inpatient admission and is not changed to outpatient.
• The Part A to Part B Rebilling Demonstration is being terminated. CMS will inform participating hospitals that the Part A to Part B Rebilling Demonstration is being terminated and will provide the necessary instructions.
• The ruling clarifies Medicare appeals adjudicators’ scope of review. Administrative Law Judges (ALJs) may no longer award payment for Part B services when the Part A claim is denied. According to the Office of Medicare Hearings and Appeals (OMHA), “The Ruling explains that adjudicators may only consider the originally billed Part A inpatient admission denial. Adjudicators may not consider potential coverage under Part B because hospitals are solely responsible for determining whether to bill for services under Part A or Part B, and submitting the appropriate claims.”
• Beneficiaries will be responsible for their usual Part B financial obligations under the ruling. Part A copayments or the difference must be refunded to the patient if the Part A amount is greater than the Part B amount.

For more information, see the CMS Ruling and the MLN Matters Article MM8185 concerning Part B Inpatient Billing in Hospitals.

 

 

 

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