Congress Passes Legislation to Avert 25% Reimbursement Cut
Congress Passes Legislation to Avert 25% Reimbursement Cut
CMS Announces MEDICAID RACs are coming!
MEDICAID RECOVERY AUDIT CONTRACTORS RULE ANNOUNCED TO HELP REDUCE IMPROPER PAYMENTS
CMS ANNOUNCES EDUCATION EFFORT TO SUPPORT PROGRAM
The Centers for Medicare & Medicaid Services (CMS) today proposed new rules to help states reduce improper payments for Medicaid health care claims through the use of Medicaid Recovery Audit Contractors (RACs) as part of the Affordable Care Act’s larger strategy to crack down on waste, fraud and abuse in the health care system. Medicaid RACs are contractors, working for States, that will audit payments made to health care providers to identify Medicaid payments that may have been underpaid or overpaid, and recover overpayments or correct underpayments, similar to the RAC program in Medicare.
“Reducing improper payments is a key goal of the Administration, and the tools provided by the Affordable Care Act will help us achieve that goal,” said CMS Administrator Donald Berwick, M.D. “We are using many of the lessons that we learned from the Medicare RAC program in the development and implementation of the Medicaid RACs, including a far-reaching education effort for health care providers and State managers.”
Under the Affordable Care Act, States must establish Medicaid RAC programs by submitting state plan amendments to CMS by December 31, 2010. The law allows CMS to provide extensions or exceptions to States, if necessary, and details regarding these processes are included in the proposed regulation. In addition, the proposed regulation issued by CMS today outlines the requirements that states must meet and the Federal contribution CMS will provide to assist in funding the state RAC programs.
Medicaid RACs will be paid by the States on a contingency basis to review Medicaid provider claims, identify and recover overpayments made for services provided under Medicaid State plans and Medicaid waivers. The proposed regulation allows States the discretion to determine whether to pay their Medicaid RACs on a contingency basis or under some other fee structure for identifying underpayments.
CMS is encouraging interested parties to comment on the proposals included in the regulation. These include the payment methodology for identifying overpayments and underpayments as well as the recovery of overpayments and correction of underpayments, and the requirement that RACs report fraud or criminal activity whenever they have reasonable grounds to believe such activity has occurred.
Under the regulation, as proposed, a State may use its current administrative appeals process or may modify its process for Medicaid RAC-related appeals. All fees paid to the Medicaid RACs must come from amounts recovered after all available appeals have been exhausted.
Because CMS has proposed to require States to implement their programs in a timely manner, CMS is providing educational programs to help States understand both the Medicare and Medicaid RAC programs. On October 1, 2010, CMS released a State Medicaid Director letter which provided initial guidance to the States regarding the RAC program. CMS issued an educational DVD entitled “Medicaid RACs: Are You Ready?” targeted to State Medicaid and Program Integrity Directors and held a webinar for states offering RAC procurement tips. Additionally, on November 4, 2010, CMS hosted an educational forum describing Lessons Learned from CMS’s experience with Medicare RACs.
A copy of the regulation may be viewed at the Federal Register’s website, http://www.ofr.gov/inspection.aspx. For Additional information on the Affordable Care Act can be accessed at, http://www.healthcare.gov/.
House Delays Medicare Payment Cut
The House of Representatives has approved a 1 month delay in the proposed Medicare cuts to physicians
Congress Proposes Medicare Reimbursement Fix
From Modern Physician:
U.S. Representatives John Dingell (D-Mich.), Frank Pallone (D-N.J.), Pete Stark (D-Calif.) and Henry Waxman (D-Calif.) introduced legislation to extend the current physician Medicare reimbursement rates for 13 months and provide a 1% update for both this year and next year.
Senate Finance Committee Chairman Max Baucus (D-Mont.) and Ranking Member Chuck Grassley (R-Iowa) have introduced a bill that would provide a month-long extension to the Medicare physician payment formula, and said they will work together to pursue a year-long fix that could be enacted before the month-long patch expires.
MGMA Report: More than 62% of practices to limit number of Medicare patients they accept
CMS Releases Proposed Provider Anti-Fraud Rule from AHA
CMS releases proposed provider anti-fraud rule
From the AHA - The Centers for Medicare & Medicaid Services yesterday issued a proposed rule intended to strengthen Medicare and Medicaid fraud oversight by, among other provisions, bolstering provider and supplier screening procedures, suspending payments and requiring state Medicaid programs to stop using providers that have been excluded from Medicare or another state's Medicaid or Children's Health Insurance Program. The proposed rule carries out provisions of the Patient Protection and Affordable Care Act. Simultaneously, CMS is preparing to issue a proposed rule regarding hospital compliance programs, as required by the ACA. The agency is seeking input from hospitals and others about what should be required in compliance plans, as well as information about their current anti-fraud compliance programs, including how they have incorporated U.S. Sentencing Guidelines, their programs' costs, benefits and effectiveness of such programs, and the systems necessary to implement them. Comments are due to CMS by Nov. 16. CMS plans to issue the proposed rule on compliance program requirements at a future date.
Fraud Crackdown Mandated Under New Law
Fraud crackdown mandated under new law
The president challenges federal agencies to reduce improper payments by $50 billion by 2012, including cutting improper Medicare fee-for-service pay in half.
By Chris Silva, amednews staff. Posted Aug. 4, 2010.Washington -- President Obama on July 22 signed into law a bill that requires federal agencies to identify and recover improper payments and further cut down on waste, fraud and abuse in federal spending.
The bill was sponsored by Rep. Patrick Murphy (D, Pa.) and Sen. Tom Carper (D, Del.), who said the techniques and tools provided through the law were based partly on those used by Medicare on a limited basis in recent years. A three-year demonstration program that launched in California, Florida and New York in 2005 identified roughly $1 billion in Medicare overpayments, according to the Centers for Medicare & Medicaid Services.
The Improper Payments Elimination and Recovery Act requires federal agencies to identify and recover more of the estimated $98 billion of taxpayer dollars that are lost annually due to wasteful spending, Carper said. The law directs agencies to produce audited corrective action plans, mandates all agencies that spend more than $1 million to perform recovery audits on all programs and penalizes those that fail to comply with current accounting laws.
The administration in recent months has become more vocal about reducing improper payments. In fall 2009, a new executive order laid out a strategy to reduce improper payments by increasing transparency and boosting incentives for compliance. In March 2010, the president signed a memorandum directing all federal agencies to intensify their use of payment recapture audits. And on June 8, Obama announced that the administration would work to cut the improper payment rate in Medicare fee-for-service in half by 2012, a move that would eliminate more than $20 billion in payment errors.
Obama remarked after signing the bill that he's challenging federal agencies to reduce improper payments by $50 billion between now and 2012.
CMS currently is working to expand its recovery audit contractor program to all of Medicare and to Medicaid by the end of the year. RACs are third-party auditors hired by CMS to comb through Medicare claims from hospitals, physicians and others to identify improper payments.
Inefficient Claims Process
A more efficient claims process
Health plans need to standardize their filing rules to reduce the billions of dollars wasted in the claims processing system.
Editorial. Posted Aug. 2, 2010.
Since the American Medical Association launched its National Health Insurer Report Card in 2008, there has been noticeable progress by plans that apparently have taken to heart the AMA's call to improve the efficiency and transparency of their claims processing.
However, the AMA's 2010 report -- the first report that has measured the overall rate of claims accuracy -- finds the industry's efforts to address the issues have a long way to go. That's because, for all the improvements that health plans have made in three years about disclosing to physicians when a claim was received, and how much will be paid for each service, one out of every five physician claims is still processed or paid incorrectly.
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It seems that insurers have realized that it's in their financial best interest to make the claims process more efficient, something that benefits physicians as well. Some plans have reached out to the AMA to work on ways to improve their systems. Notably, Cigna has gone from not disclosing to the physician the date it received a claim and not disclosing the contracted rate to doing both nearly 100% of the time on its electronic remittance advices or explanation of benefit forms.
But insurers also continue to hold on to proprietary, complex processes that create the one-in-five claims failure rate.
All told, that inefficiency wastes an estimated $15.5 billion annually, including a toll of up to 14% of physician revenue to ensure timely and accurate payment from private insurers.
Rather than use an industrywide standard set of filing rules -- as the AMA has advocated -- payers require physicians to fill out different forms for each payer, creating more paperwork bottlenecks and increasing the complexity of the claims process. Also, plans still are not transparent or consistent in their claim edits or denials.
So while insurers are more willing to tell physicians what they will be paid for each service, they are still all over the map in terms of how they will make those payments -- and whether claims will be bundled, denied or downcoded. A claim that gets a thumbs-up from one insurer could generate a note from another saying there is an error. The 20% error rate is not uniform among the seven major private-pay plans rated -- the plan at the top of the list was accurate 88.4% of the time, and the least accurate plan came in at 74%, according to the report card. The 2010 and past years' report cards are available online (www.ama-assn.org/go/reportcard).
Certainly there are times when a physician practice makes a mistake in its claims, and the AMA has encouraged physicians to reduce errors by filing timely and accurate claims to the best of their ability the first time, and by reviewing and reconciling claims payments. Patients also need to know their own insurance. Lack of eligibility is the No. 1 reason a claim is denied, which speaks to the need of employers and insurers to educate their patients on what their plans will cover.
Processing errors are another matter. When they arise, the AMA and industry analysts say, the confusion often comes from the insurer, particularly on more complex claims involving multiple physicians.
The AMA's goal -- which should be the health plan industry's goal -- is to see the error rate reduced from its current 20% to 1%. For each percentage point that error rate goes down, the health system -- including physicians and insurers -- saves an estimated $777 million.
The AMA has worked, through its Heal the Claims Process campaign, to help physicians with the claims processing system. The National Health Insurer Report Card grew out of that initiative as a way to tell insurers what they can do to make things better.
That some health plans are taking steps to improve matters is a positive sign. However, a 20% error rate represents an intolerable level of inefficiency. This is even more important as health system reform is expected to add more insured individuals -- and thus more claims -- to the system. It clearly will benefit all concerned -- payer, patient and physician -- to get that rate down.
AMA Concerned over CMS’ Elimination of Consultation Codes
CMS eliminated all consultation codes, except telemedicine consults, as of January 1, 2010, as part of its cost cutting measures. As specialists bill for these codes more than primary care, it is those providers who have experienced greater revenue declines – most of whom by more than 5%, according to an article posted by Amednews.com, last week.
A survey of roughly 5,500 physicians found a number of financial repercussions and unintended consequences as a result of losing the ability to bill for those codes. The Amednews article examines some of those losses. The financial ones are to be expected, however CMS only predicted a revenue drop of around 3%. Yet results of the survey demonstrated a higher loss. Indeed, an infectious disease physician interviewed for the article said that his practice had experienced an 8% loss so far this year and even had to lay off two mid-level medical staff members and one biller in March due to the loss of the consultation codes.
More far reaching consequences that CMS would surely not want to happen would be less of “the kind of care coordination that CMS has been seeking in Medicare.” Time spent reviewing charts and talking to families and other medical staff in the hospital setting are also not being recompensed, so that time may be decreased as well. The article covers many other issues as well, including coding for new or established patients among primary care and other specialists.
The AMA has concerns over how this will affect patients, which primarily means less access for patients. A neurologist explains what that means in terms of his practice: “One of the keys to neurology is to spend the time with patients. Taking a good history is critical, so devaluing our time undermines the service. Ultimately, it means some patients are not getting the care or attention that they should.” On June 18, the AMA and 30 other physician organizations sent a letter to CMS expressing these concerns.