ATLANTA – The upcoming Medtrade (Oct 20-23, 2014 in Atlanta) has an excellent line-up of speakers who will present programs addressing the most important topics faced by DME suppliers today. Every issue of Medtrade Monday, leading up to Medtrade, will highlight a Medtrade educational session.
In part 1, we start with Audits: A State of Confusion. As is often the case with the audit environment, there is a great deal of confusion over the types and nature of the audits being conducted by the multiple CMS contractors (DME MACs, RACs, CERTs, ZPICs, etc.) and how to respond to the audits. Audits can generally be divided into two categories: post-payment audits and prepayment reviews.
A post-payment audit can be conducted by a MAC, CERT, RAC or ZPIC. With a post-payment audit, the supplier has previously received payment from the MAC. Now the Medicare contractor is trying to determine if the MAC should have previously paid the claim. If the answer is “no,” then the contractor will ask the supplier to repay the money. While a post-payment audit is unpleasant, it is not “life threatening.”
On the other hand, a prepayment review is more serious in the sense that the contractor will not initially pay the claim until the supplier submits documentation confirming to the contractor (in its discretion) that the underlying documentation is proper. If a claim is denied at the prepayment review stage, and the supplier goes through the administrative appeal process and eventually ends up before an ALJ, then it may literally take years to go through the appeals process and receive payment for the claim.
A post-payment audit/prepayment review may be triggered if the supplier furnishes items that have been identified as problematic and an edit has been put in place. Another factor is if the supplier has caught the attention of one of the many auditors. If an auditor suspects fraud and abuse a referral will be made to the ZPIC which will take a closer look at the supplier.
This may result from (i) the supplier faring poorly with prior post-payment audits and prepayment reviews; (ii) data analysis indicating that the supplier submits claims that are “outside the norm;” and (iii) complaints from physicians and beneficiaries. In order to reduce the risk of the supplier catching the attention of an auditor, it is important that the supplier be successful in responding to prior post-payment audits and prepayment reviews. It is important that the supplier have a good relationship with physicians and beneficiaries so as to reduce the chances of a complaint being filed.
In order to get off a prepayment review, the goal of the supplier is to reduce its charge denial rate. The supplier needs to thoroughly review its documentation to ensure that it supports the submitted claims. The supplier should open up a line of communication with the contractor’s auditor. If the supplier is initially on a 100% prepayment review, then the supplier should try to convince the auditor to limit the prepayment review to a set number of claims and/or to limit the review to a set time period. The supplier needs to push the auditor to make claims determinations as quickly as possible.
In a post-payment audit, the additional documentation request will generally provide information on the type of documents a supplier is required to submit. The documents generally include patient medical records; supplier records; detailed written order; dispensing order; Certificate of Medical Necessity; and delivery tickets. Suppliers must provide a copy of documentation from the patient’s medical record that identifies the condition/diagnosis for which the item is being ordered and other pertinent information relating to the medical necessity for the item. The date of the visit must be noted in the record and must be prior to the date of service on the claim.
For items addressed in LCDs, there must be information to document that all coverage criteria specified in the medical policy have been met. The medical record must be in the usual format for that physician’s/provider’s medical records. Supplier created forms, attestations, or similar documents are not sufficient to document medical necessity, even if completed and signed by the physician. The records should be organized by claim or patient. The supplier should include the following along with the records: (i) a copy of the request letter, including the patient list; and (ii) a cover letter detailing the documents being submitted and a summary of the medical records (the summary should briefly discuss how medical necessity is established for each claim).
CMS continues to award lucrative fixed-fee and contingency-based contracts to private for-profit entities to find payment errors (often technical in nature) that result in a large percentage of denials and may result in extrapolated overpayments. The cards are stacked against the DME supplier as it works its way through the redetermination and reconsideration administrative appeals process. However, the supplier is often successful at the ALJ level. Of course, the benefit of being successful at the ALJ level is diluted by the fact that notwithstanding that the law requires disposition of the ALJ appeal within 90 days, in reality there is a 24 to 30 month delay in ALJ decisions.
The complex administrative appeal process is riddled with errors, inconsistencies, and downright confusion. This has resulted in an over-burdened, unfair, and broken system.
On October 20, 2014, from 3:15 p.m. to 4:30 p.m., Wayne van Halem, president of The Van Halem Group, will present a program that addresses these issues. van Halem’s program is part of Medtrade’s 6-4-18 series. Mr. van Halem is widely recognized as an expert in assisting DME suppliers as they respond to audits.