I ESCAPED FR0M A RAC [AUDIT]- A GUEST ARTICLE.

[Todays post is by Joan c. Ditges, RN, the principal in Legal Nurse Associates, Inc. a consulting company engaged in Medical Record Reviews, Summations and Analyis  and a consultant to this firm]

CMS couldn’t have chosen a more appropriate month for the initial nationwide roll out of the Recovery Audit Contractor permanent program. March is the month when many, even non sport’s fans,  are consumed by college basketball’s March Madness and find it difficult to concentrate on little else. March is the month when we begin escaping from the confines of winter as we get our first glimpses of spring only to be fooled by a late March snowstorm that seemingly blew in from no where and caught us totally unprepared. March is also the first month of the Roman Calendar and is named after Mars, the god of war. How apt that the RAC foot soldiers should wage war on our healthcare providers in March, some of who are consumed by a similar March madness in frenzied preparation for auditors, others who were lulled by the inactivity of winter and will be unprepared when the blizzard that is RAC blows into their facilities and practices.

After what has been deemed an extremely successful demonstration program over the last three years, Recovery Audit Contractors are sharpening their pencils, or more appropriately  refining their computer data mining programs, as they prepare to address improper Medicare over (and under) payments perpetrated by medical providers. In defense of the Center for Medicare and Medicaid Services, they have every right to expect that providers, who receive payment for services from their agency, bill and submit claims for those same services in a correct manner. In defense of our healthcare providers, the requirements that CMS has established to receive those payments are so complex that the medical providers have, out of necessity, had to employ billers, coders, reimbursement and HIPAA specialists and assistants whose sole function is to complete claim forms. It is a daunting task for all involved and in light of the discussions regarding streamlining the IRS income tax filing guidelines, revamping the Medicare claim filing process should be second in line for consideration.

Fortunately many states will have the opportunity to learn and benefit from their predecessors (New York, Florida, California, Massachusetts and South Carolina) experiences. It is not uncommon, in dealing with claim resolution services for individuals without clinical expertise to surreptitiously adjust levels of care in critical care environments severely impacting the hospital’s bottom line when recouping those claims. Based on poorly written formats that only review billed charges,  when oxygen therapy and respiratory treatments are prescribed for the same day, one has been routinely disallowed.  This also occurs with respirators, oxygen and CPAP or BiPAP. The subtleties of a treatment strategy versus a therapy are often beyond the comprehension of data mining programs.   Due to loosely written guidelines, non clinically oriented auditors have reversed all charges for normal saline not understanding the clinical implications associated with a  normal saline IV flush, normal saline intravenous infusions and floor stock normal saline used for irrigation. Although many treatments and procedures are standard and accepted practices by physicians, many are routinely disallowed under the guise of not being a plan benefit. These companies, like the RAC’s, have been paid on a contingency basis. Their focus is to document as many overcharges as possible, banking, literally,  on the fact that medical facilities will be willing to negotiate a percentage of the total, no matter how erroneous that total may be, rather than conduct a line item review. Hospitals, SNF’s, outpatient care centers and physician practices have been forced to use their ever dwindling resources to defend against these changes and adjusted charges.

Not surprisingly, high dollar (>$50,000) claims, to both private sector insurers and in the RAC demonstration project, have proven to be a particular target for the auditors. These include circulatory disorders with cardiac catheterizations; respiratory diagnoses with neoplasm, an operating room procedure or ventilator support; septicemia; wound debridement and/or skin grafting; major small or large bowel procedures and operating room procedures unrelated to principal diagnosis. Hospital stays that are scrutinized closely include one day stays for endocrine, nutritional or metabolic disorders (DRG 829); major gastrointestinal disorders (DRG 371 and 373); chest pain (DRG 313) and back pain (DRG 551 and 552). Patterns that include altered mental status and gastroenteritis, dehydration and fever were particular favorites.  Transfers to skilled nursing facilities within 3 days from hospital discharge were placed under the examiners microscope and were dissected accordingly as the hospitals were forced to share the DRG reimbursement (per diem) with the SNF. In the outpatient services and observation arenas, the analysis shifts between medical necessity and hours in the bed with additional investigation when the administration of medication and the often neglected start and stop times are reviewed. Physicians office practices have been largely off the hook as RAC’s justified their existence in the demonstration project in recouping 85% of overpayments from inpatient hospitals and only 2% from physicians and physical therapists. It is conceivable to expect the RAC to target high dollar claims for review in the initial phases of full implementation with movement to the practitioners to follow.  As healthcare providers have made adjustments to the RAC, the RAC processes and procedures have undergone some changes as well.

Those who have been the focus of the live RAC autopsies will remember that pain and hopefully come to appreciate the new and improved RAC regulations. In the permanent program there will be a medical director to provide oversight who is available to discuss all claim denials if requested and there will be mandatory coding experts whose certification is available for review. Because the contingency fee of the RAC must  be returned if the claim is overturned at any level of appeal, there is a financial incentive for the RAC to get it right the first time or not get paid. Additionally the time frame for the RAC to retrospectively review a claim has narrowed from 4 to now 3 years with a maximum look back date of 10/1/2007, where no such date existed in the demonstration program. Limitations have been placed on the number of medical records that the RAC can request in any given examination period. In the new Scope of Work, RAC’s can attempt to identify improper payments from duplicate services, improperly coded services, incorrect payment amounts and non covered services. Given these scenarios, it behooves the healthcare providers to  proactively conduct their own  audits, identifying situations which may be consistent with the findings of the demonstration projects, make changes and develop strategies accordingly. Never before have trained and experienced coding and billing specialists  been more important to the practice of healthcare then they are right now.

Helpful links:
www.cms.hhs.gov/RAC

Joan C. Ditges has been part of the healthcare industry for longer than she sometimes wishes to admit. Her varied experiences have led her to the claims resolution arena in the private sector. Those very recent and poignant experiences provide her with more than enough motivation to chart a path in helping healthcare providers defend against RAC investigations.