Andrea Stark

Many of our clients are struggling with supporting medical necessity for oxygen claims under review. As such, we have put together a few considerations of common scenarios when evaluating your documentation.  These are not all inclusive, but establish a good foundation to build from when evaluating your oxygen patients.

For Medicare to cover oxygen therapy, the qualifying blood gas study must be performed while the patient is in a chronic stable state. The term “chronic stable state” is defined as “…not during a period of acute illness or an exacerbation of their underlying disease.” In other words, all co-existing diseases or conditions that can cause hypoxia must be treated and the patient be in a chronic stable state before oxygen therapy is considered eligible for payment. This does not mean that patients with diseases such as obstructive sleep apnea (OSA) or pulmonary disease are unable to ultimately receive oxygen therapy, only that these diseases need to be controlled with the appropriate methods first, and then, if the patient remains hypoxemic, oxygen may be considered.

Example 1: In the case of OSA, the patient would need to be compliantly using a properly fitted and titrated PAP device. With uncontrolled apneas, the patient has periods where they are not breathing and this results in desaturations. Only after the underlying OSA is adequately treated and controlled may the patient be tested for oxygen.

Example 2: In the case of obstructive pulmonary disease (e.g. asthma, emphysema, bronchitis), the patient should be managing their disease through the use of inhalers or a nebulizer, and an appropriate medication. Only after the underlying pulmonary disease is adequately treated and controlled may the patient be tested for oxygen. Again, the intent is to rule out all lesser forms of treatment before oxygen is considered.

Example 3: ER Visits. In the event a patient is taken to the emergency room and an underlying respiratory condition is identified, the blood gas study obtained during their visit may only be used if the patient is in a chronic stable state. In other words, the patient must not be having an acute episode and any causes of the underlying respiratory condition must be adequately treated and controlled before the test takes place. Most patients will not be in a chronic stable state during an ER visit and may need to be referred to their primary care physician to be qualified for oxygen after their visit.

Andrea Stark

MiraVista, in collaboration with providers of Group 3 products, successfully initiated discussions with the Jurisdiction C RAC, Connolly Healthcare, to secure modifications to a disruptive automated review.  The implications of the exercise should bring hope to all suppliers that auditing contractors can be rational and make responsive changes when merited.

Providers of Group 3 air-fluidized beds in Jurisdiction C started getting bombarded with automated recoupments from Connolly Healthcare in December, and could not figure out why the claims were being recouped without development.

When researching a RAC audit, the first step is to visit the RAC website and locate the CMS approved audit issues.  We discovered that the websites post a shortened version of the audit issues, and with automated reviews providers do not get development letters that contain the full version of the audit issue direct from the RAC.  Therefore, they do not get an opportunity to view the full description of the audit logic.  Attempts to figure out the true root of the audit logic were elusive until a dialogue began with senior RAC officials.

Connolly officials directed us to a very helpful, but widely unknown, resource.  Connolly has a Provider Portal in place that provides access to audit activity for a given provider.  This portal is the only place where providers can find the detailed description of auditing logic on automated reviews.  If you service Jurisdiction C beneficiaries, you can log in yourself and view the provider-specific data the RAC maintains for your company using your PTAN, State, and a CCN that has been pulled for RAC review by visiting the following link: https://cmsprovider.connollyhealthcare.com/.  When you log into the portal, you can see the history of all the claims audited by this contractor, dollar amounts, service dates, status of the review, and a detailed rationale for the edit.  This data can also be exported to Excel.  Through the portal, providers can see other detailed elements, such as the maximum number of complex reviews the RAC can pull for your company in a 45-day period (as this is provider-specific; limited to 10% of your annual volume of claims submission in a year).

Upon viewing the detailed rationale, we discovered that the claims were being recouped based on a provision in the LCD that requires the USE of a Group 2 support surface 30 days prior to initiation of therapy with a Group 3 bed.  We dug in a little deeper and researched claims from the audited sample and found that most fell into two categories: 1) either the patient had a Group 2 in their history that had capped out and was no longer actively billing, or 2) the patient obtained a Group 2 from another insurer.  In all cases, the patients had used a Group 2 support surface prior to the Group 3, but the problem was that none of the claims had a PAYMENT for a Group 2 immediately before the first service date for the Group 3.

Connolly was receptive to meeting with us to discuss our concerns that the logic structure was targeting too broad a sample.  There are a number of logical reasons that there will be no payment history immediately preceding the Group 3 delivery.  In our dialogue with Connolly, we pointed out that many patients will be on Group 2 therapy for extended periods of time prior to initiation of Group 3 therapy.  The Group 2 products are capped rentals and they convert to purchases after 13 months of rental.  Connolly officials actively listened to our concerns and agreed the logic should be modified.  As a result, the audit was converted from a fully automated review to a semi-automated review.  Connolly additionally modified the logic so that if they find any history of a Group 2 in the data they have available, the claim will NOT be targeted for recoupment or further review.  However, when these provisions cannot be established, the claims will be developed for a complex review/response from the provider to prove the patient had used the Group 2 prior to the Group 3.  This is a HUGE win for providers in this product space!

We are very pleased to report that the logic has already been corrected as of our March conversation and will not affect claims going forward.  However, any appeals in the works for previously targeted claims will have to be resolved through normal channels.  Separate from this audit issue, Connolly has another complex review that is targeting Group 3 claims for development and this audit will require providers to establish documentation that fully complies with all aspects of the LCD to support medical necessity.  When claims are developed for complex review, providers are given 45 days to send in a response to the request.

Audits aren’t going anywhere, and in the course of an increasing number of audits, mistakes will be made by contractors and providers alike.  The key take-away here is that it is possible to establish a reasonable dialogue with contractors.  These dialogues can lead to a meaningful modification of audits with unintended consequences.

Derrick B. Stark, CPA

When you close your eyes, you can picture a qualified medical biller. He or she is a labyrinth of useful knowledge about modifiers, diagnosis codes, and the cute quirks of every insurance company on the planet. They can even pitch in when you forget the lyrics to the third verse of “Who Let the Dogs Out.” As long as we set up equipment, they can get payments… until they can’t. They can do it all… until they won’t. We cannot live without them… until we must.

In spite of these challenges, you can structure your organization to produce more capable billers.  Here are the 3 steps to training a capable medical biller.

DETERMINE THE POSITION

Medical billing is a process, not a person. There is no single person that knows everything. And even if there was, everything changes. As of yesterday, that knowledge is obsolete. In reality, there are four primary positions in medical billing:

• Intake and data entry – You know these individuals as customer service representatives, but make no mistake, the billing process starts as soon as the fax machine starts warming up its toner cockles.
• Transmission – These individuals are responsible for reviewing claims before submission, resolving rejection reports, and printing paper claims and patient statements.
• Payment posting – These guys do what they say they are going to do…post payments.
• AR clerks or collectors – AR clerks resolve denials and pursue insurance companies like they stole your grandma’s purse.

These positions are split between two general types: those who move large volumes of data and information quickly and efficiently according to a prescribed logical plan, and those who investigate to solve unique problems based on broad experience. It is very difficult for one person to switch between these categories, so it is important to segregate duties accordingly.

TAKE THE CLASS

While I am not a proponent of all-day lecturing and self-study, inexperienced medical billers need a point of reference. That is, they need to understand the concepts of medical billing and the prime research sources for the specific questions they will encounter. Develop a curriculum of articles, videos, and/or lectures that cover the following topics:

• General overview of the company, its history, and its major departments and components
• Basic billing workshop
• Research
• Using the billing software and other significant applications

These educational bits should be broken up over multiple days and interspersed with on-the-job-training.

SHADOW AND BE SHADOWED

After the educational genesis, “newbs” should be assigned to an experienced staff member with expertise. This trainer should not be a territorial wildebeest with fangs and an insecurity complex. The habits and attitude of the trainer will very likely transfer to the trainee.

First the trainee should simply observe the work. The trainer should explain what she is doing as she does it and why each task is necessary. As the trainer encounters unusual items, she should walk through the specific steps of determining how to handle the abnormality. Afterwards, switch seats and let the trainee get his hands dirty with the trainer looking over his shoulder. Rinse and repeat.

MONITOR FROM AFAR

Once the budding medical billing expert gets traction, they should begin working independently, but the trainer should not dive into a complex project immediately. Prioritize the questions the trainee has and help him discover the answer as opposed to simply giving it to him so the trainer can return to her very important work. Audible huffing sounds are not helpful. It is also important to review the trainee’s work product very closely until it meets standards.

These basic steps, reasonable intelligence, and practice will usually make an inexperienced biller a competent biller within 4-8 weeks.

Derrick B. Stark, CPA

I know what you’re thinking. Automobiles and DME have nothing in common.

In all honesty, the only thing I know about Henry Ford, not withstanding the obvious, is that he is credited as the father of the modern assembly line. Unlike other automotive pioneers who never made it into our history books, Ford went beyond simply recognizing a need. Rather than stopping at identifying the attributes of a good automobile, he actually spent time developing and mastering the process of building a product. It was not proprietary knowledge that a good automobile had to be easy to drive, cheap to maintain, and affordable to buy.

So what, you ask, do automobiles have to do with DME billing? Well, nothing. But we can certainly all take a cue from Henry Ford.

Prevailing wisdom tells us that success in billing comes from understanding the rules, regulations, and procedures of third party payors. But no matter how much we read trade publications, attend conferences or talk with one another, we never really get the sense of success we seek when it comes to our billing operations. Why? Because while we’ve become good at identifying the attributes of a successful biller, we’re stopping short of mastering the process. Knowledge is not the same as execution, and much like Ford, we need to master the processes, procedures, and internal controls necessary to develop our own billing assembly lines.

We know that regulatory obstacles are prickly. We know when our accounts receivable clerk didn’t follow up on claim. We know when our collection metrics indicate substandard performance. We lobby Medicare to be fair. We hire more experienced people. We bring in the accountants to tell us where we can balance the budget. And yet, the nagging mediocrity of our billing operations persists. Why? Because we’re not addressing the underlying process deficiencies.

Instead of trying to solve problems with billing knowledge, we need to commit to improving the process of converting claims to cash. When struggling with denials or claim rejections, we should not assume the failure is the result of substandard employees or a lack of ability, knowledge or education. Instead, try answering the following questions:

• Does our company have a program to ensure complete and compliant intake procedures?
• Do we have a protocol to follow up on outstanding correspondence such as pending re-certifications?
• What tools do we use to validate claims before they are transmitted?
• Does our company have a reconciliation process to ensure that all payments are posted and posted only once?
• Do we have a process in place for identifying aging balances and trends?
• Does our company have standard communication protocol, like an Intranet or list serve, for disseminating information to employees that need to know?

Even if our staff knows a clean claim when they see one, they may have no idea how to build one. After all, it wasn’t enough for Ford’s employees to know what a completed automobile looked like; each had to understand how their piece functioned and fit together with the others to form the final product

Derrick B. Stark, CPA, Brandi Collins, and Angela Hayden

Blue Cross Blue Shield (“BCBS”) plans across the country are instituting a fundamental change in the rules for submitting claims for durable medical equipment (“DME”). As a result, providers are likely to see longer payment cycles, higher collection costs, reduced payments and/or more uncollectible balances. Patient risk assessments before delivery are imperative; the billing department will not be able to mitigate the damage afterwards.

Background

Traditionally, providers have submitted claims to the BCBS plan in the state in which the provider is contracted (“Home State Plan”), regardless of the state plan in which the patient is actually covered. The provider’s Home State Plan would handle the exchange between states. Under new rules, DME providers are required to submit claims to the BCBS plan in the state in which the equipment is purchased or delivered, regardless of the provider’s contract status with that plan.

For example, assume the DME provider is located in New Jersey and Horizon Blue Cross Blue Shield of New Jersey is the Home State Plan. Further assume the provider delivers equipment across the state line to a patient living in Virginia and covered by Virginia’s BCBS plan. The provider does not have a contract with the Virginia plan. Under the old rules, the provider would submit the claim to the Home State Plan, who would then file with the Virginia plan for approval, and claims would process with in-network benefits because the Home State Plan served as the gateway. Under the new rules, however, the provider must submit the claim directly to the Virginia plan and it will be subject to out-of-network coverage benefits.

Implementation

At MiraVista, we are seeing the first signs of the new rules in some, but not all, states. A few have sent notifications to providers, while others are already denying claims as OA109 “claim not covered by this provider.” Our research team has contacted customer service representatives in several states and discovered there is little continuity in their understanding. Payor websites and Internet searches provide surprisingly little guidance. While clear directives are not currently available, we suspect, based on our experience, the following scenarios:

• Claims will be improperly denied by the Home State Plan because the patient is covered under another state’s plan and there is no evidence the transaction took place in the home state
• Claims will process out-of-network

We suspect the far more devastating impact to cash flow is the latter where claims are unexpectedly processed out-of-network.

Improperly Denied Claims

Our initial discussion with some of the provider representatives at various states indicate that the goal is to determine the location of the transaction, and ultimately the appropriate insurance plan, by the place of service field on the claim form. While providers most often use a value of 12 to report a private residence as the place of service, the appropriate value for in-store deliveries has not been decided or communicated. Until place of service guidance is available, we are not sure how the payor will appreciate when the sale takes place at the provider’s location. Delivery tickets denote this information but are not typically transmitted with claims. As such, we expect these claims will almost always deny and require appeal within the applicable time limits. Appeals require a significant effort to compile and usually must be submitted in a paper format. While the cost of collection and average collection times will increase, these claims should be payable.

Out-Of-Network Claims

The far more serious scenario is when equipment is subject to the out-of-network coverage limitations. Services provided out of network:

• are often subject to significantly reduced fee schedules
• are subjected to higher deducible amounts
• often require the provider to pursue collection of amounts paid directly to the patient for services rendered
• may have different authorization or documentation requirements

Furthermore, out-of-network providers generally have limited access to resources granted by the Home State Plan such as online tools for claim status, patient information via customer service representatives, and the ability to submit claims electronically without separate enrollment.

Assessing and Limiting Risk

Providers with substantial exposure might include:

• Locations close to state lines
• Locations in states serving a highly mobile client base (e.g. Northeastern states, Florida)
• Providers that routinely mail or ship goods to other states
• Providers with high concentrations of sales to BCBS patients
• Providers that are already seeing increased denials related to these rules

Our initial inquiry and research suggest there are many unanswered questions regarding the tactical implementation of these new rules, and that uncertainty will adversely affect cash flows. For now, we are advising our clients to:

• Analyze their billing software database and historical sales to identify cases where the patient’s address is in a state where the provider is not currently contracted with that state’s BCBS plan(s)
• Begin the contracting process for those states where the provider has a significant patient base but is not currently contracted with the BCBS plan(s)
• Create an easy-to-reference cheat sheet for intake personnel to flag BCBS patients with addresses in non-contracted states
• Evaluate options for high risk patients including non-assigned claims, collecting money up front, and declining to service the patient

Conclusion

Understanding the risks these new rules pose is critical. In the best case scenario, delayed payments are likely. Significant equipment sales that will not reasonably covert to cash flows in a timely fashion, if ever, can disrupt the entire business. Vendors still want to be paid according to terms. Payroll is still due every other Friday. Take proactive measures to mitigate these risks and avoid the looming cash flow squeeze.

For updates on this story, subscribe to our blog or sign up for our mailing list at http://miravistallc.com.

The US Supreme Court has voted to uphold all provisions of the Affordable Car Act, including the hotly debated individual mandate and Medicaid expansion provisions. Both provisions have been contested as unconstitutional and outside the scope of the government’s authority.

The individual mandate is a provision within the law that would require most Americans to obtain a minimum level of health insurance by 2014, or else begin paying a new tax. The amount of the tax would be determined by factors such as the person’s income bracket, number of dependents and filing status. The tax would not apply to individuals who do not pay federal income taxes because their household income is less than the filing threshold established by the IRS.

Another key provision challenged in the Act is the requirement to expand the scope of coverage for the Medicaid program and increase the number of individuals States must cover. For example, extending coverage to all individuals under age 65, including those without children, who have incomes less than 133% of the federal poverty level by 2014. If States do not comply, they are threatened with losing federal funding.

Supreme Court Justice John Roberts delivered the court’s opinion:

“Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes. See §5000A(b). That, according to the Government, means the mandate can be regarded as establishing a condition—not owning health insurance—that triggers a tax—the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earn­ing income… The Federal Government does not have the power to order people to buy health insurance. Section 5000A would therefore be unconstitutional if read as a command. The Federal Government does have the power to impose a tax on those without health insurance. Section 5000A is therefore constitutional, because it can reasonably be read as a tax,” Roberts said in his opinion.

The Supreme Court did agree that threatening to revoke federal funding to States for noncompliance with the Medicaid expansion clause is unconstitutional. The Justices struck down this clause in their final opinion, allowing the mandated expansion of Medicaid, but precluding the Secretary from withdrawing existing Medicaid funds from States for failure to comply. No other provisions in the Affordable Care Act were impacted by this change.

Standing provisions within the Act that impact Medicare and DME, include: enhanced supplier screenings (i.e. revalidation); the expansion of Competitive Bidding and the application of bid prices nationwide by 2016; the elimination of the first month purchase option for standard power wheelchairs; the 2.3% medical device sales tax; authority for the OIG to enact payment suspensions during fraud investigations; authority for CMS to enact enrollment moratoriums (not yet enacted); and a face-to-face requirement for all billable DME items (not yet enacted).

A copy of the full court opinion is available here.

When revalidating through the electronic provider enrollment chain and ownership system (PECOS), you are highly encouraged to print a paper copy of your reenrollment application for your records. However, if you tried to do this recently, you may have noticed that not all of the information you entered into PECOS successfully printed. In fact, the form that prints may look somewhat different than the CMS-855S you are accustomed to seeing.

We have confirmed with CMS that there is a glitch in the PECOS system that occurs when suppliers try to print paper copies of their electronic reenrollment applications. Suppliers should note that this does NOT impact the information that is sent to the NSC. The information you enter into PECOS will still be successfully transmitted to the NSC, once your electronic application is submitted.

On one of the last screens displayed in the PECOS revalidation process, suppliers are given the opportunity to view and print a copy of the completed application. Clicking the print link should produce a prepopulated paper copy of the CMS-855S form that you may keep for your records. However, as of May 1, 2012, a glitch in the system is resulting in applications printing with incomplete fields and missing information. As previously mentioned, while this does create a bit of a headache for suppliers trying to print hard copies, if you can see the information in PECOS and everything looks correct online, it is safe to submit your electronic application to the NSC.

After a little digging, MiraVista was able to confirm that the glitch is the result of PECOS trying to print information to a new, draft version of the CMS-855S form that has not yet been released. You can identify whether PECOS incorrectly printed the draft copy of the CMS-855S by looking for an 04/12 revision date in the lower left-hand corner of each page. This version of the CMS-855S is not yet active, and it is our understanding that PECOS is not set to populate the revised fields in this form.

The active version of the CMS-855S form that should be linked to in PECOS (and that suppliers should use if they opt to submit a paper application) was last updated on July 2011 and can be identified by an 07/11 revision date in the lower left-hand corner of each page. This is the form PECOS is set to populate when printing hard copies of electronic revalidation applications.

We have informed CMS of the issue and have received confirmation that they are looking into a fix. A date has not yet been released for the implementation of the 04/12 draft version of the CMS-855S form. Look for full details on revisions made to the draft form in the June 2012 issue of Vista Notes.

The DME MACs have released a list serve that has been picked up by several media outlets regarding the information suppliers should include in Item 29 of the claim form. The list serve indicates that: any beneficiary payment collected for the specific covered service, (i.e., coinsurance and deductible) should be reflected with the claim submission. However, we strongly recommend that suppliers refrain from following this guidance, specifically as it relates to coinsurance and deductible amounts, while we seek additional clarification from the DME MACs.

Suppliers have historically been told not to put any dollar amounts in Item 29, unless the patient has remitted payment up front for a non-assigned claim. The reason for this is that when the claims processing system sees a dollar amount in Item 29, it is generally assumed that the patient paid for a covered service and that the patient, not the supplier, should be sent a check for reimbursement.

MiraVista is actively seeking a clarification from the DME MACs regarding this guidance and will provide an update as soon additional information becomes available.

Did you know that if you hire any employee or contract with an entity that has been excluded from participating in a Federal healthcare program, that it could cost you tens of thousands of dollars in fines?

In addition to imposing civil money penalties (CMPs), the Office of Inspector General (OIG) has the authority to exclude any individuals and entities who have engaged in fraud or abuse from participation in Medicare, Medicaid and other Federal healthcare programs. Per the OIG:

• The practical effect of an exclusion is to preclude employment of an excluded individual in any capacity by a health care provider that receives reimbursement, indirectly or directly, from any Federal health care program.
• No Federal payment may be made for any items or services furnished by the excluded individual or entity, even if the payment is being made to another non-excluded provider or supplier.
• In addition, payment may not be made for items and services prescribed by an excluded physician.

Also per the OIG, if you employ an excluded individual while providing services to patients under a Federal healthcare program, you could face:

• A civil money penalty of up to $10,000 for each item or service furnished by the excluded individual or entity and listed on a claim,
• An assessment of up to three times the amount claimed, and
• A possible exclusion from program participation (i.e. Medicare).

For liability to be imposed, current statute requires that the supplier knew or should have known that the employee or entity was excluded. But, it is the OIG’s stance is that suppliers have a duty to check the exclusion status of an employee or contractor before entering into a relationship, or else run the risk of CMP liability.

With fines and revocation of billing privileges at stake, it is not worth the risk to hire someone without performing a check. Additionally, we recommend a retroactive check on existing employees if you have not screened them previously. To protect yourself against entering into a relationship with an excluded individual or entity, take a moment to search the OIG’s Exclusion Database, also known as the List of Excluded Individuals/Entities (LEIE). In addition to potential employees and vendors, be sure to screen each of your current employees for possible exclusions. The database is free, easy to use and is available here: http://exclusions.oig.hhs.gov/.

Below are some tips to keep in mind when searching the OIG’s Exclusion Database:

• You can search for up to 5 names at one time.
• Remember to screen all owners, managers and officers within the company.
• In addition to the employee’s current name, be sure to screen for aliases (i.e. nicknames like Charlie instead of Charles), hyphenated names and maiden names.
• For a broader search, type in the first few letters of the last name, with no first name.
• Don’t rely solely on the address or occupation listed to verify a match. The person may have moved and obtained a different position.
• If you locate someone you believe may be an employee, you can verify if they are the same person by clicking on the name and entering the employee’s social security number.

For more information on OIG exclusions see:

http://oig.hhs.gov/exclusions/effects_of_exclusion.asp.

As technology improves and the push towards electronic health records progresses, we will likely see a reduction in the number of paper statements/letters mailed by contractors and a shift towards electronic communications. The latest example of this comes from the Jurisdiction A DME MAC, NHIC, which recently announced that they will no longer issue hard-copy Acknowledgement Letters when redetermination requests are received.

Effective April 1, 2012, suppliers in Jurisdiction A will need to call the MAC’s IVR system to check on the status of a redetermination request. According to the MAC, suppliers should wait at least 10 days after submitting their request for it to be received and uploaded into the IVR system. If you call the IVR 10 days after submission and are unable to locate your request, you should call NHIC’s customer service line at: 1-866-590-6731. Per NHIC, if a redetermination request is determined to be a reopening issue, it will be reassigned in the system as a pending reopening case.

Instructions on how to use the IVR to check on a redetermination request are available in the DME MAC A IVR User Guide at:

http://www.medicarenhic.com/dme/contacts/DME_MAC_A_IVR_User_Guide.pdf.