Effective August 1, 2016, CMS institutes Pre-Claim review in Five States. The demonstration will begin no earlier than August 1, 2016 in Illinois, no earlier than October 1, 2016 in Florida, and no earlier than December 1, 2016 in Texas. The demonstration will begin in Michigan and Massachusetts no earlier than January 1, 2017.
Pre-Claim Review Begins in Five States: August 1st is the First Date, Illinois is the First State
Effective August 1, 2016, Home Health Agencies in five states will begin the three year Medicare pre-claim review demonstration by which an agency will complete the patient assessment, initiate procedures, and establish services then submit a request via fax, mail, or electronic submission of medical documentation to the respective MAC for approval prior to the submission of the final claim. The MAC is expected to provisionally approve or disapprove the services within 10 business days. If the MAC denies the payment, the agency can resubmit a new request
What is the Difference between Pre-Claim and Prior Authorization?
Per CMS, with a Pre-Claim review, services have already begun and the request is submitted after assessments and services have been completed or begun. Prior Authorization requires a request prior to services being initiated. CMS states this new requirement is not creating new documentation requirements. The agencies are to submit the same information they currently submit for payment, but do it earlier in the process.
What States are Included in the Demonstration?
The demonstration will begin no earlier than August 1, 2016 in Illinois, no earlier than October 1, 2016 in Florida, and no earlier than December 1, 2016 in Texas. The demonstration will begin in Michigan and Massachusetts no earlier than January 1, 2017. (Pre-Claim Demonstration for HH FAQ, 6/8/2016)
The demonstration is expected to have minimal effect on beneficiaries per CMS. The Pre-Claim request is submitted after a RAP but before the submission of the final claim. However, some agencies have expressed concern, stating that in an already fragile bottom line market, any further delay of payment could be harmful to the agency’s financial health.
CMS states the five states chosen “show extensive evidence of fraud and abuse in the Medicare home health benefit for treatment performed in these states” (CMS Pre-Claim Demonstration for HH, FAQ, 6/8/2016).
Decision, Documents Needed, and Options
For pre-claim review, the MAC will make the determination using regulation, National Coverage Determination, and Local Coverage Determination requirements. The MACs will be expected to respond within 10 business days for an initial request and 20 business days for a resubmitted request following a denial.
Resubmissions may be sent an unlimited number of times as necessary, but obviously, the agency will want to get the appropriate information submitted up front to minimize payment delays. There will be a tracking number on each decision notice and that number will be used on the claim.
CMS states that, generally those claims that had the provisional review will not have additional review. However, note that Z-PICs conduct targeted prepayment and post payment review which will continue and CERTS review a stratified random sample of claims annually to identify improper payments. That CERT sample may include the pre-claim reviewed items also.
If an agency would be denied payment and after resubmission still receives denial, they could follow the appeal process. If an agency submits a claim without a pre-claim review, per CMS, if that claim is deemed payable, it will be paid at a 25% reduction of the full claim benefit. Obviously, an agency would have serious financial if that became the agency process.
Centers for Medicare & Medicaid (2016). Pre-Claim Review Demonstration for Home Health Services. CMS.gov. Retrieved from: https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Pre-Claim-Review-Initiatives/Overview.html
For Start of Care document reviews that includes OASIS review, H&P, med profile, clinician visit assessment and visit documentation review, as well as F2F comment along with ICD-10 coding, CONTACT SELECT DATA at 1.800.332.0555
RACs, MACs, Z-PICs, Part II of IVCERTS – (Comprehensive Error Rate Testing) To better calculate the performance of the FIs and MACs, as well as to look at the reasons for their errors, CMS decided to look at a number of additional rates. The additional rates include
provider compliance error (how well providers prepared claims for submission)
paid claims error rates (measures how accurately FIs and MACs make coverage, coding, and other claims payment decisions). CERTs randomly select a sample of about 100,000 claims each reporting period.
CERTs review the claims for proper Medicare coverage, coding, and billing rules, and if not in compliance, they assign an overall error rate.
CERTs also identify if providers received overpayment letters or notices of adjustments to be made for claims that were overpaid and underpaid. CERTs are considered the Quality Improvement specialists who track and trend the performance of fiscal intermediaries and Medicare Administrative Contractors.
Z-PICs – Zone Program Integrity Contractors will perform Medicare Program integrity functions for CMS. They will interact with each MAC to handle fraud and abuse issues within their jurisdictions. ZPICs are seen to consolidate the work of present CMS Program Safeguard Contractors (PSCs) and Medicare Drug Integrity Contractors (MEDICs) and are divided into 7 zones.
The Z-PICs act with the Department of Justice and FBI and act as the investigators when fraud is very strongly thought to have been found. The Z-PICs have the power to suspend claims for up to a year and the agency has no appeal recourse during that
Annually, CMS receives 1.2 billion claims. That breaks down to 4.3 million claims per work day, 574,000 claims per hour, and 9,579 claims per minute. Fraud and abuse are on the rise and the pressure is on.
CMS has unleashed the age of the auditor with the advent of the RACs, MACs, CERTs, MICs, Z-PICs, and now, the HEAT.
RACs- The contingency motivated Recovery Audit Contractors (retrospectively focused). The RAC Demonstration Project of 2005-2007 recovered over $1.3 billion, mostly due to medically unnecessary services (45%), incorrect coding (35%), and insufficient documentation (10%). With four RAC approved firms covering specific geographic regions, these auditors are expected to continue their positive recovery program. The RAC demonstration project yielded a cost of only 22 cents for every $1.00 recovered. They are now in place and ready to go at measure. Certain RACs have been held back until all MACs were in place. That is now completed.
MACs –Medicare Administrative Contractors have been transitioning in and replacing the Regional Home Health Intermediaries (RHHIs). There are 15 MACs with 4 focusing only on DME claims. Though providers fear the RACs, they are well aware of the power of the MAC. This auditing body can impose “severe administrative action” such as up to 100% prepayment review, payment suspension, and use of statistical sampling for over payment estimation of claims (current and prospective focus). MACs have power and Congress is encouraging them to use it.
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