ICD-10, Two-Midnight Rule, RAC Audits, SGR Delayed

March 31, 2014 By

The Senate passed this evening the “Protecting Access to Medicare Act of 2014“, which creates a 12 month delay for pending Medicare cuts pursuant to Medicare’s sustainable growth rate (SGR) payment formula. This bill avoids the 24% Medicare cuts physicians were facing starting on April 1st (this will be the 17th delay of the SGR).  Another significant component of the Act includes the delay in ICD-10 implementation, until at least October 1, 2015.

In addition to these significant postponements, the Act also delays until March 2015 the implementation of the “two-midnight” rule and the recovery audits of unnecessary claims.

Filed Under: Medicare Tagged With: , , ,

Increased OIG Focus on Kwashiorkor Claims

March 10, 2014 By

In its recently released 2014 Work Plan, the OIG has announced that it will investigate hospital billing for Kwashiorkor.  Kwashiorkor is a form of severe protein malnutrition that generally affects children living in tropical and subtropical parts of the world during periods of famine or insufficient food supply. This syndrome is characterized by retarded growth, changes in skin and hair pigment, edema, and pathologic changes in the liver.

This extreme form of malnutrition, however, is very rare in the United States, which is why Kwashiorkor billing at hospitals is a target of the OIG. Because a diagnosis of Kwashiorkor on a claim also substantially increases a hospital’s reimbursement from Medicare, the OIG stated it would review Medicare payments based on Kwashiorkor claims to determine whether the diagnosis is adequately supported by documentation in the medical record.

Recently, for example, the OIG found that Wellspan York Hospital incorrectly billed Medicare inpatient claims with Kwashiorkor, resulting in overpayments of $204,000 over two years. The hospital attributed the errors to a misinterpretation of the coding guidelines for malnutrition because of a lack of clarity in the guidance.  Other hospitals, like Mercy Medical Center, have attributed Kwashiorkor errors to encoder software which incorrectly assign diagnoses of protein malnutrition to ICD-9-CM 260 (Kwashiorkor).

In light of the increased OIG focus on Kwashiorkor claims, hospitals should strengthen its controls to ensure that coding software and staff comply with Medicare billing requirements. Additionally, if there is in fact a Kwashiorkor diagnosis, hospitals should ensure that the medical record (e.g. discharge summary) substantiates the use of a Kwashiorkor diagnosis code.

For additional information regarding Kwashiorkor billing or the 2014 OIG Workplan please contact Adam Snyder or Jefferson Lin.

 

Filed Under: Compliance, Medicare, OIG Tagged With: , ,

Want to Get Paid for Inpatient Admissions? Follow CMS Certification Requirements.

September 11, 2013 By

In its final regulations for the 2014 Inpatient Prospective Patient System, the Centers for Medicare and Medicaid Services emphasized the importance of physician certifications. Under the regulations, Medicare will only pay for an inpatient admission if a physician certifies the medical necessity for the stay. The first piece of such certification is for the physician to complete an inpatient order when he or she expects that the patient will require a stay that crosses at least two midnights.

In addition to the order, physician certification for the inpatient stay also must include the following information:

  • Certification that the inpatient services were ordered in accordance with the Medicare regulations governing the order;
  • The reasons for either: (1) hospitalization of the patient for inpatient medical treatment or medically required inpatient diagnostic study; or (2) special or unusual services for cost outlier cases under the inpatient prospective payment system;
  • The estimated time the beneficiary requires or required in the hospital;
  • The plans for post hospital care, if appropriate, and as provided in the Medicare regulations; and
  • For Critical Access Hospitals (CAHs), the physician must certify that the patient will reasonably be expected to be discharged or transferred to a hospital within 96 hours after admission to the CAH.

Physicians must complete all certification for the inpatient stay prior to patient discharge. In order to help ensure Medicare payment for inpatient admissions, hospitals should educate physicians on the importance of certifications, and provide assistance to physicians in gathering necessary documentation.

CMS has prepared a guidance document about hospital inpatient admission orders and certification. For more information about inpatient admission certification, please contact Casey Moriarty.

Filed Under: Medicare Tagged With: , ,

OIG Launches New Online Submission Process for the Self-Disclosure Protocol

July 9, 2013 By

On July 8th, the Office of Inspector General (OIG) launched a new online submission process for the Self-Disclosure Protocol (SDP).  The SDP allows health care providers to voluntarily identify, disclose, and resolve instances of potential fraud involving federal health care programs, including Medicare and Medicaid.   The OIG has stated that individuals and entities that utilize the SDP will pay a lower amount of damages for violations than would normally be required in resolving a government-initiated investigation.

You can access the online submission process here.

The OIG hopes that the online submission tool for the SDP will streamline the process for providers that want to resolve violations without the time and expense of a government-directed investigation.  With that said, we suggest that providers have an attorney analyze any potential SDP issues prior to completing the online form.  As always, the health law attorneys at OMW are happy to help.

For more information about the SDP online submission process please contact Casey Moriarty.

Filed Under: Compliance, Medicaid, Medicare, OIG, Overpayment Tagged With: , , ,

OIG ISSUES SPECIAL FRAUD ALERT ON PHYSICIAN-OWNED DISTRIBUTORSHIPS

March 26, 2013 By

On March 26, 2013, the Office of Inspector General (“OIG”) issued a Special Fraud Alert regarding physician-owned entities or distributorships (referred to as “PODs”) that generate revenue from the use of implantable medical devices ordered by their physician-owners for use in procedures performed by such physician-owners at hospitals or ambulatory surgery centers (“ASCs”).

While the Special Fraud Alert focuses on certain characteristics of PODs that create substantial risk of fraud and abuse and potential danger to patient safety, the OIG cited other prior pronouncements and guidance it issued over the past twenty-four years regarding its long-standing concern over physician investments in entities to which they refer.  Prior OIG guidance cited included the 1989 Special Fraud Alert on joint Venture Arrangements, published in 1994  and a letter dated October 6, 2006, regarding physician investments in the medical device industry.

It is clear that the OIG believes that significant risk of patient or program abuse, including but not limited to potential violations of the Federal Anti-Kickback statute, may flow from arrangements between and among physicians, device manufacturers and other device vendors.  The Anti-Kickback statute makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce, or in return for, referrals of items or services reimbursable by a Federal health care program.

In its current Special Fraud Alert regarding physician-owned entities, the OIG recounted its view of certain questionable features regarding selection and retention of investors, solicitation of capital contributions, and distribution of profits, all of which potentially raise four general concerns typically associated with kickback arrangements:

1.  Corruption of medical judgment;

2.  Over-utilization;

3.  Increased costs to the Federal health care programs and beneficiaries; and

4.  Unfair competition.

The OIG is particularly concerned in this arena because the physician may play a significant role in the selection of the type of device and which manufacturer to use.  The OIG cautions that disclosure of financial interest may not be sufficient to cure what would otherwise amount to fraud and abuse, and identifies the following specific characteristics of arrangements that would cause concern:

— The size of the investment offered varies with anticipated volume or value of devices used by the physician.

— Distributions are made on the basis of volume as opposed to ownership interest.

— Conditioning referrals based on the use of certain devices on entities to which physicians refer.

— Arrangements that incentivize a physician’s use of certain devices or penalizes the physician for the failure to use certain devices.

— PODs ability to buyout physicians interests on favorable terms based on physician’s failure to meet certain volume requirements.

— The POD is a shell entity that is not truly engaged in the business, or provides no oversight related to distribution functions.

— Physicians fail to identify conflicts of interest through their involvement with PODs related to Hospital or ASC conflict of interest processes.

This Special Fraud Alert reiterates the OIG’s longstanding position that a physician’s ability to profit from referrals may lead to violations of the Federal Anti-Kickback statute.  Finally, the OIG reminds concerned parties that the OIG Advisory Opinion process is available.   For more information about physician-owned entities, the applicability of the Anti-Kickback statute, and the OIG Advisory Opinion process, please contact Adam Snyder or Don Black at (206) 447-7000.

Filed Under: Anti-Kickback/Stark, Compliance, Medicare, OIG Tagged With: , , ,

Assigning Patients to ACOs

March 13, 2012 By

A hotly contested area of the proposed ACO rules concerns the assignment of Medicare Fee-for-Service (“FFS”) beneficiaries to ACOs.  Once a Medicare beneficiary is assigned to an ACO, the ACO will then be held accountable “for the quality, cost and overall care” of that beneficiary.  The ACO may also qualify to receive a share of any savings that are realized in the care of these assigned beneficiaries due to appropriate efficiencies and quality improvements that the ACO may be able to implement.

As the final rule explains, assigning Medicare beneficiaries requires several elements:

  1. An operational definition of an ACO, as opposed to a formal definition of an ACO, so that ACOs can be efficiently identified, distinguished, and associated with the beneficiaries for whom they are providing services;
  2. A definition of primary care services for purposes of determining the appropriate assignment of beneficiaries;
  3. A determination concerning whether to assign beneficiaries to ACOs prospectively, at the beginning of a performance year on the basis of services rendered prior to the performance year, or retrospectively, on the basis of services actually rendered by the ACO during the performance year; and
  4. A determination concerning the proportion of primary care services that is necessary for a beneficiary to receive from an ACO in order to be assigned to that ACO, as compared to the proportion of primary care services from other ACOs or non-ACOs.
Filed Under: Accountable Care Organizations, Health Reform, Medicare Tagged With: , ,