Transcript Medicare CERT Audits - American Academy of Orthopaedic

Brian S. Parsley, MD
2nd Vice President AAHKS
Clinical Associate Professor
Baylor College of Medicine
Houston, Texas
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2nd VP for AAHKS
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Orthopaedic Surgeon
in Private Practice
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Strong Patient
Advocate
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The PATIENT
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We Want to Get It Right
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Outline the Rules and We
Will Follow Them!
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We Want to Maintain
Access to Care for Our
Patients.
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We are in this Together!
Medicare receives over 1.2 Billion claims
per year. This equates to:
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• 4.6 million claims per work day, or
•575,000 claims per hour
•9,580 claims per minute
•160 claims per second
 MAC: Medicare Administrative Contractor.
▪ US is split into ten regions for purposes of Medicare claims
administration. MACs are private companies that serve as contractors
performing claims administration for Medicare.
▪ Each MAC has some level of latitude in the interpretation and
application of the rules based on regional determinations.
 CERT: Comprehensive Error Rate Testing.
▪ CERT audit program is designed to monitor the performance of MACs
and to ensure that they are administering claims properly. CERT audits
result in annual reports of the rate of improper payments made to
hospitals. A high error rate for a particular procedure on the Part A
hospital side may lead to increased scrutiny of Part B physician claims.
 RAC: Recovery Audit Contractor.
▪ A RAC is an independent medical collection agency that works for Medicare to
review overpayments and underpayments to providers.
▪ RAC’s are paid 9-12.5% contingency fees for the overpayments they recover.
▪ RAC’s have the ability to analyze claims with payment dates reaching as far back
as October 1, 2007.
 LCD: Local Coverage Determination.
▪ MACs define LCDs for different procedures. The LCD tells you what Medicare will
cover in its MAC jurisdiction. For example, they define what constitutes medical
necessity for a specific procedure, and no procedure will be covered if it is not
found to be medically necessary.
▪ Failure to follow the requirements of an LCD will result in an overpayment, which
could be sought after an audit and refunded to CMS.
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MACs have always had the authority to audit claims in order to
reduce their CERT error rates.
 In late 2011, at least three MACs initiated audits that targeted
specific orthopaedic procedures with high error rates in their
jurisdictions.
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MAC Audits have looked at documentation requirements of
non-surgical interventions prior to total joint replacement.
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MAC has launched a prepayment audit program affecting
orthopaedic codes, including those for total joint replacements
in Florida.
 if problems are found with the Part A claims, then payment will be
denied, and the MAC may then perform a post-payment audit of the
Part B physician services claims related to the problematic Part A
claims and deny payment.
Goals set by President Obama:
To reduce the Medicare FFS improper
payment rate from 12.4% to 8.5% by Nov 2011 and
6.2% by Nov 2012.
 Identifying past improper payments through
data analysis. (Audits)
 Correcting past and improper payments
through post pay review. (Audits)
 Preventing future improper payments through
provider education.
Is it fraud? (Intentional falsification or deceit to obtain
payment)
 Is it abuse? (CMS: when doctors or suppliers do not follow
good medical practices that can result in unnecessary
costs to Medicare)
 Is it a pattern of disregard for regulations?
OR
 Is it hospitals and physicians providing appropriate care to
their patients but unable to comply with a myriad of
confusing, vague technical Medicare documentation and
billing rules despite their good intentions?
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 How does CMS tell the difference?
 How do providers protect themselves?
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ALL FRAUDULENT CLAIMS ARE IMPROPER
PAYMENTS BUT ALL IMPROPER PAYMENTS
ARE NOT FRAUDULENT CLAIMS!!!!!
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MOST ARE DUE TO IMPROPER
DOCUMENTATION!
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Improper payments: est. 3% to 10% of total healthcare
expenditures nationally.
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Improper Payment Elimination and Recovery Act 2010
(IPERA) - Signed by President Obama on 7/20/2010
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FY 2010: Feds recovered more than $4 billion thru these
enforcement efforts.
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$2.5 billion represented recoveries under the False Claims
Act, the largest amount in the history of the DOJ.
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Affordable Care Act (ACA) provides tools for enhanced
fraud prevention and prosecution.
Repository of all Medicare claims
• All Medicare auditors have access to Medicare Data
Warehouse
• Data mining at will for Parts A, B, C, D
• Auditors input results of reviews
• Red flag suspicious activities also alerts other auditors
• Public disclosure required by ACA ( the public will know
that you or your hospital has been audited).
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The MAC pays all Medicare providers except for
DME – allows claims matching.
MAC‘s Role in audit process
 Performs provider education
 Adjusts payments after CERT, RAC (and other audit)
review
 Beginning Jan. 1, 2012 – Sends Demand Letter
▪ –Applies recoupments and corrects underpayments
▪ –Limited information on Demand Letter
 Supplies information to Data Warehouse
 Notifies RAC when account receivable is created
▪ –N432 remittance notice sent to hospital
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Reviews conducted by clinicians (nurses,
physical therapists, etc) and certified coders
Pre pay review: Claims that are found to be
improper are denied and no payment issued.
Post pay claims that are found to be improper
 –overpayment is recouped
 –underpayment is paid back
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Suspected fraud: Referral for investigation
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CERT evaluates MAC‘s payment
error rate
Claims are randomly selected
 Post payment only
 CERT auditor reviews medical
records
 Reviews conducted by at least one
nurse
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Claims paid incorrectly are scored
as ―”errors”
 No documentation error: Failure to
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submit record
Insufficient documentation
Lack of medical necessity
Incorrect coding
Other errors (duplicate payments / no
benefit category / other billing errors)
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Computes and reports error rates.
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Nationally
By Contractor
By Service
By Provider Type
CMS and contractors analyze MAC error rate data and
develop Error Rate Reduction Plans
Payments adjustments by CERT are referred to MAC
Payment adjustments are made by MAC
Appeals go to MAC
Provides ”targets” for future RAC issues
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The RAC Audits have been implemented
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Recovery Audit Prepayment Review
Demonstration Project is on the horizon
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You bettcha!
 It can affect the cost of borrowing
 It raises the costs to hospital
 It increases the cost of care
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Purchase of new equipment
Maintenance of facility/ equipment
Staffing ratios and salaries to attract good
staff
Marketing (information in the public domain)
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No!
Physician payments are now coming under review.
If the hospital is denied then you will be denied
Physicians are now being audited directly
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Comprehensive Error Rate Testing (CERT) Notice #14632
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Followed CERT audit and denial of inpatient hip and knee
replacements
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Affects Part A providers and physicians in Colorado, New
Mexico, Oklahoma and Texas
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“The CERT contractor stated that favorable audit findings
would have required medical record documentation
clearly demonstrating that the patient has end-stage
joint disease and should have included evidence of prior
failed conservative therapy.”
CERT Notice 14632
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Documentation expected (physician, ARNP, RN, PT,
OT)
 Preoperative joint examination findings showing end
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stage joint disease requiring joint replacement.
Peoperative significant loss of range of motion or joint
deformity.
Operative findings supporting end-stage joint disease,
including bone-on-bone disease.
Documentation that patient needed adaptive skills or an
assistive device to maintain mobility.
Preoperative radiographs showing end-stage joint
disease.
CERT Notice 14632
CMS Wants to know what YOU are thinking
Accurate and complete documentation in the
physician records as well as the hospital records
is the key
 A medical evaluation must be performed. The
evaluation should include:
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clear documentation of the patient’s functional status
documentation of the patient’s mobility and pain.
evaluation may be done all or in part by the surgeon.
the surgeon must sign off on the report and
incorporate it into their records.
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Pre certification and approval of DRG 470
patients prior to posting on surgery schedule
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Screening for sufficient data to justify surgery
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This effects both Medicare and commercial
insurance patients
The Methodist Hospital Medicare Joint Precertification Clearance Form
Total Joint Replacement- Knee
Patient Name: _______________________________
D.O.B.: _____________________
Indication: Osteoarthritis
Medical Necessity Criteria:
Pain at Knee (All criteria must be met)
 Increased with initiation of activity
Increased with weight bearing
Interferes with ADLs
Findings at Knee (All criteria must be met)
 Pain with passive ROM. Pain scale score: ______
Limited ROM
Crepitus
Joint effusion/swelling
Arthritis at Knee by x-ray (Minimum of 2 criteria must be met)
Subchondral cysts
Joint subluxation
Subchondral sclerosis
Periarticular osteophytes
Joint Space narrowing
Non-surgical Treatment Attempts (All criteria must be met)
NSAID (Minimum of one attempted for 4 weeks)
NSAIDs attempted: ________________________ Duration NSAID was attempted: ___________
Contraindicated/not tolerant for 4 weeks due to:
 History of allergic reaction
 Anticoagulant use
 History of PUD
 Other: ________________________________________________________________
Physical Therapy (12 weeks)
Physical Therapy or
Home Exercise Program Duration therapy was attempted: __________
Contraindicated/not tolerated for 12 weeks due to:
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Excessive pain experienced by the patient
 Other: _________________________________________________________________
External Joint Support (12 Weeks)
External Joint Support attempted:
 Cane
Crutches
Knee brace/sleeve
Other: _________________
Duration external support was attempted: _______________________________
Contraindicated/Not tolerated for 12 weeks due to:
 Excessive pain experienced by the patient
 Unstable gait contributing to increased risk for falling/injury
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Other: _______________________________________________________________________
Physician Signature: _______________________________________
Date: _____________
***Please fax back to the TMH Resource Center (713-790-2620) prior to scheduling the procedure. Forms must be faxed
before 2 pm to receive same day response.
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Chief Complaint: End stage osteoarthritis, right knee, for knee replacement.
History: Patient has had bilateral osteoarthritis, gradually progressive over 10-15
years. Most recent X-ray (7/22/11), right knee shows joint space near obliteration
along with marginal osteophytes and subchondral sclerosis. Has been treated as
follows: Ibuprofen 400 mg QID since January; PT 3 x week from 3/15/11 to 6/30/11.
Patient started using a cane in May. Right knee pain is continuous at level 3/10
with 6/10 on ambulation. Sometimes pain keeps him up at night. No longer able
to climb the five steps to his front door. Knee pain and stiffness limit walking to
less than 25 yards without resting.
Physical Exam: Bilateral knee deformity consistent with severe osteoarthritis.
Right knee reduced to less than 90 degrees. Unable to rise from a chair
unassisted.
Impression: Worsening pain, deteriorating range of motion and significant
interference with function. Current therapy ineffective. Total Knee Replacement
is only option for pain control and functional restoration.
Orders: Admit to inpatient care for right TKR.
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MUST be dictated for transcription within 24 hours
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Operative findings should support the diagnoses; describe
pathology observed in detail.
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For your and the surgical assistant’s benefit, describe the
need for any surgical assistance.
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Include type of metal or ceramic surface of prostheses,
orthopedic devices, use of cement and rationale for
biological products. Include every item used in this
description.
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Describe any complications and how handled
intraoperatively.
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RECOMMEND dictating within 24 hours of discharge for
optimal coding.
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This intended to be more than a recap of the surgery
performed.
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If complication occurs, THEN DOCUMENT IT IN THE D/C
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OP patients discharged the day of surgery also must have
pertinent information filled in the form.
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If referred for Extended Recovery or Observation, a
Discharge Note should be written on a Progress Note form
with the correct DATE and TIME to document the proper
flow of assessment and care provided during this period.
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AAOS is working actively with CMS nationally
and the Regional MAC’s to
 Clarify & modify the documentations requirements
 To try and delay the enforcement process until our
members and our hospitals are better educated on
the process and expectations
 Assisted in the development of a MLN Matters with
CMS that was sent to all Medicare providers in Sept
 Supply YOU the membership with an informational
piece and documentation form to utilize
 Help to develop a draft LCD for Regional MAC’s to
utilize
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MR should contain enough information to
support the determination that the total
joint procedure was reasonable and
necessary =presence of advanced DJD
 Currently, audits show medical records
commonly lack documentation that justifies the
need for payment.
 Not Fraud and Abuse but lack of Documentation!!
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Set up templates to ask the questions that you
need to include and allow for comment sections
so that you can explain yourself
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Describe the treatment plan with as many dates
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Add X-ray detail check-offs
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Instruct your office personnel on the importance
Show Me
The Money!
Thank You