Tag Archives: Center for Medicare & Medicaid Services

New CMS Ruling Limits Scope of Audit Review

MACs and QICs limit their  Audit Review

In RACmonitor,  Dr.  Ronald Hirsch recently wrote that “Nothing is more frustrating to a provider than having a claim denied, preparing a comprehensive appeal, submitting that appeal, and then having the appeal denied – not because the appeal wasn’t compelling or correct, but because the auditor found a second issue and the denial was upheld based on that new issue.”

“Fortunately, this frustration should be going away very soon.”

The Centers for Medicare & Medicaid Services (CMS) have limited the scope of review in certain circumstances, whereby “MACs and QICs to limit their review to the reason(s) the claim or line item at issue was initially denied.”

And this Means…

This means that a claim review can not be modified later with additional objections. The auditor will not be able to “pile on” additional objections if they fail to have a claim rejected based on their initial review.  The auditor must submit all of its objections to a claim from the beginning, and after that, the auditor loses the right to add more objections.

For complete information on this new ruling, see RacMonitor, CMS Announces Limits on Reviews by MACs and QICs.

For more information on how to Reverse Medicare and Medicaid audits, and effectively deal with claims brought against you, contact Barraclough Health (email to info@barracloughllc.com)  to talk about your issues. 

RAC Audit Medicare Data Snapshot

RAC Medicare Audit  Data  From Senate Chairman Hatch

RAC Medicare Audits recovered over $3 billion

  • A large portion of the initial payment determinations are reversed on appeal.  The Department of Health and Human Services Office of Inspector General reported that, of the 41,000 appeals made to Administrative Law Judges in FY 2012, over 60 percent were partially or fully favorable to the defendant.
  • In Fiscal Year 2014, Medicare covered health services for approximately 54 million elderly and disabled beneficiaries at a cost of $603 billion.
  • Of that figure, an estimated $60 billion, or approximately ten percent, were improperly paid, averaging more than $1,000 in improper payments for every Medicare beneficiary.
  • The large number of appeals being filed can’t be put on the docket of the Office of Medicare Hearings and Appeals for 20-24 weeks.
  • In FY 2009, the majority of appeals were processed within 94 days.  In Fiscal Year 2015, the average for an appeal is 604 days.

Source: Hatch Statement at Finance Markup of the Audit & Appeal Fairness, Integrity, and Reforms in Medicare Act of 2015 (June 3, 2015) Senator Hatch (R-Utah) is the Chair of the Senate Finance Committee.

The Barraclough Blog features latest news on events and policies, as well as original Barraclough features and blogs  about Litigation support for Medicare and Medicaid appeals and statistical overpayment extrapolations.

Senate Acts on RAC Audits and Appeals Process

Audit Appeals Process Quagmire

Barraclough LLC  Dubious  of Senate RAC Actions

The Congress continues to try to fix Medicare’s arduous healthcare audit procedures, as the RAC audit process and healthcare providers continue to be locked into a claims remediation nightmare. The Audit and Appeal Fairness, Integrity, and Reforms in Medicare, or AFIRM, Act of 2015, was introduced on June 3, 2015.

Senator’s Wyden statement about the Finance Committee Markup of this bipartisan effort is that it “will streamline the appeals and audits process so cases are resolved quickly and at the earliest possible step.” The legislation provides for:

  • More HHS personnel resources pick up the pace in order “to keep up with the enormous increase in appeals.” The Office of Medicare Hearings and Appeals can currently adjudicate 77,000 appeals in a year, far below the 474,000 appeals OMHA received in 2014.
  • HHS can use its resources more efficiently and process more appeals because of a new track for lower-cost, less-complex cases to be considered by a different set of hearing officers than other cases.
  • Requiring CMS to better coordinate provider audits “to ensure the entire process is more transparent and efficient, including the creation of an independent Ombudsman position at CMS” in order to assist those considering appeals. Providers who consistently bill correctly are exempted for burdensome audits, as a reward for their business practices.

Although this markup provides some improvement by separating high value from low value cases, Barraclough LLC  is  dubious about the additional number of people on the CMS payroll to deal with the appeals backlog and the overall  impact of the Audit and Appeals Ombudsman which has yet to be fully explained.  RAC Audit Appeals would be better served with more data transparency,  a change in RAC auditors contingency fee payments, and the quality of initial determinations.

For the full text of Senator Wyden’s statement, click here.

As the  AFIRM legislation progress, Barraclough LLC will continue to analyze the impacts and make recommendations for the best course of action.

2013 CMS RAC REPORT SHOWS DOCTORS IN SOME STATES PAY 18 TIMES MORE RECOVERY FEES

The Centers for Medicare & Medicaid Services (CMS) recently released its annual report to Congress:   Recovery Auditing in Medicare for Fiscal Year 2013: FY 2013 Report to Congress as Required by Section 1893(h) of the Social Security Act.

The report is full of statistics on the Medicare auditing program.  It presents a picture of “profit”, that is, less money is spent by the government on running the auditing program than is recovered.  It is “cost effective” to use government parlance.   (This calculation does not account for the costs born by the health care providers.)

One would think that from state to state, the amount recovered “clawed back” by the Recovery Audit Contractors (RACs) would be about the same, but it is not.   See the Figure below.

2013_RAC_DATA_Analysis_doctorsBy taking the amount recovered in a state and dividing it by the number of doctors in the same state, we can see that in Mississippi the recovery per doctor was around $18,000 dollars.   But in Maryland, it was around $1,000 dollars – an eighteen times difference! 

It would be interesting to learn more about why this occurs.

 

2013 CMS REPORT ON RACS SHOWS MASSIVE DIFFERENCES IN RECOVERY PER CAPITA

The Centers for Medicare & Medicaid Services (CMS) recently released its annual report to Congress:   Recovery Auditing in Medicare for Fiscal Year 2013: FY 2013 Report to Congress as Required by Section 1893(h) of the Social Security Act.

The report is full of statistics on the Medicare auditing program.  It presents a picture of “profit”, that is, less money is spent by the government on running the auditing program than is recovered.

The report, however, does not address the discrepancies between states for recovery “claw back” of Medicare claims.   The calculation is shown in the figure below.

2013_RAC_DATA_AnalysisWhen we chart the amount recovered and compare it to the number of persons living in the state, the difference is vast.   In Maine, for example, there was $2 per state resident recovered.   However, in North Dakota, there was $36 dollars recovered for each resident.

Does this mean that the health care providers in some states are being more strictly audited than in others?   The CMS report does not give any clue to the answer.

Federal Precision Standards for Medicare and Medicaid Statistical Sampling and Extrapolations

As we have seen from other entries to this blog, Recovery Audit Contractors (RACs) operating under the Centers for Medicare & Medicaid ServicesRecovery Audit Program who are involved in conducting Medicare and Medicaid audits of health care providers have been granted an incredible bit of leeway in acceptable standards for their work.   It is not uncommon to see precision that is far more than +/- 20%, and even when the precision is as poor as +/- 49%, the Medicare Appeals Council (MAC) as well as Federal Courts will not throw out the extrapolation.

So the question that arises is this:  Are contractors free to employ any accuracy they wish in their work, or are there standards that have been suggested or published by the Federal Government?

As it turns out, there appears to be some guidance from two sources.

Source One:

In the May 5, 2010, report by the Acting Administrator and Chief Operating Officer of the Centers for Medicare & Medicaid Services (CMS)  On page 3 of that report, the section titled “Precision-level requirements” states:

“[Office of Management and BudgetOMB Circular A-123, Appendix C, states that Federal agencies must produce a statistically valid error estimate that meets precision levels of plus or minus 2.5 percentage points with a 90-percent confidence interval or plus or minus 3 percentage points with a 95-percent confidence interval.”

There is a note in the document: Under these assumptions, the minimum sample size needed to meet the precision requirements can be approximated by the following formula, which is used in the examples:

BLOG_ACCURACY_FORMULA.001Where n is the required minimum sample size and P is the estimated percentage of improper payments (Note: This sample size formula is derived from Sampling of Populations: Methods and Applications (3rd edition); Levy, P. S. & Lemeshow, S. (1999); New York: John Wiley & Sons; at page 74. The constant 2.706 is 1.645 squared.

Source Two:

In the CMS-issued Federal Register, 72 Fed. Reg. 50490, 50495 (Aug. 31, 2007), the error estimate should meet precision levels of plus or minus 2.5 percentage points with a 90-percent confidence interval, and the State error estimates should meet precision levels of plus or minus 3 percentage points with a 95-percent confidence interval.”

So it appears that these standards, which are fairly good, have been twice promulgated by the Federal Government.

The question is:  Why are they routinely ignored by Administrative Law Judges (ALJs), and the Medicare Appeals Council (MAC)?