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.

In testimony given by Inspector General Daniel Levinson to members of the House of Representatives on March 17, 2011, the OIG announced that they will be performing, among other things, a review of improper payments identified by CERT contractors. Specifically, the OIG plans to:

• Review the amount of improper payments that have subsequently been overturned on appeal.
• Develop a pilot project to obtain missing documentation identified during CERT reviews.
• Perform an independent medical review of claims to determine whether Payment Error Rate Management (PERM) contractors are working within PERM guidelines (applies to Medicaid and Children’s Health).

This testimony follows CMS’ announcement that they will be performing follow-up reviews on the CERT contractor to specifically re-examine claims that were previously cited with errors (see below) and is a sign that officials within the industry may be taking notice of the disconnects between auditing contractors finding high instances of “errors” and the number of “errors” that are subsequently overturned in the supplier’s favor.

However, suppliers can expect little relief in the way of reviews from the OIG itself. Products currently under review for documentation requirements and improper payments include power wheelchairs and lower limb prostheses. Depending on the findings, the OIG may recommend CMS and the DME MACs implement additional edits or medical reviews for these product categories, resulting in increased pre-pay and/or post-pay reviews.

The Inspector General’s complete testimony may be read at: http://oig.hhs.gov/testimony/docs/2011/levinson_testimony_03172011.pdf.

By: Michelle Hamel, Communications Specialist, MiraVista LLC

I like to stay abreast of the latest healthcare legislation being introduced in congress and have an RSS feed that sends me a weekly list of new Medicare related bills. As I scanned through today’s list of recently introduced bills – most of which have nothing to do with DME – one particular title caught my eye. On January 18^th, the “Health Care Paperwork Reduction and Fraud Prevention Act” was introduced into the House of Representatives. Intrigued by the name, I decided to take a closer look, and it wasn’t long before I was championing its cause.

Creating standardized healthcare claim forms that all Federal government agencies would be required to use.

Count me in.

Significantly reducing the numbers of billing codes for health care claims.

I can work with that.

Simplifying and updating CMS’ electronic forms.

Sounds great.

Ensuring that the Secretary does not target providers and suppliers attempting to properly submit Medicare claims for inadvertent billing errors.

Now we’re talking!

And when I reached section 5 “Overpayments Under the Medicare Program” the bill’s full potential became clear. While the protections under this section only apply to physicians (at least in the bill’s current state), there are several provisions here that suppliers should be championing as well. For example, if a carrier initiates a pre-pay audit, it must explain to the physician why they are being audited within 3 months. Also, auditors are prevented from targeting physicians based on self-disclosed overpayments. And auditors may not assume that just because a physician made an honest billing error that all of their claims are bad or incorrect.

And now for the crème de la crème.

“Following a post-payment audit, a carrier that is conducting a pre-payment screen on a physician service under the Medicare program may not delay reimbursements for more than one month and as soon as the physician submits a corrected claim, the carrier shall eliminate application of such a pre-payment screen.”

To strip it down to bare bones: If we make a mistake, and we’ve fixed it, the auditing contractor needs to move on.

While limited in nature, this is the first bill to offer any type of protection from pre-pay audits. However, it’s not the first time it has been introduced. In fact, Congressman William “Mac” Thornberry, R-TX introduced four previous versions of this same bill, all of which died in congress and had little to no support. But it’s a new year, and we have a new congress. And I say we take full advantage of it.

My vote is that we as an industry take this bill, champion its cause and use it as a vehicle to extend audit protections to DMEPOS suppliers. Aside from Congressman Thornberry, the bill currently has no co-sponsors. So we’re going to have to take action if we want it to succeed.

The bill is currently awaiting review by the House Ways and Means Committee, and the House Energy and Commerce Committee. The key to keeping the Health Care Paperwork Reduction and Fraud Prevention Act (H.R. 315) alive is to contact members of these committees and ask them to support the bill. Better yet, ask them to support H.R. 315 and amend it to include additional supplier protections under sections 3 and 5!

Right now H.R. 315 is just another number on the docket. But we can make it so much more than that. Contact your congressman and let them know your struggles. Tell them why supplier protections from unrestricted auditors are a must, and show your support for this legislation.

House Ways and Means Committee: Contact the Committee, Members

House Energy and Commerce Committee: Contact the Committee

(Republican) Members, (Democratic) Members

Contact Your State Representative!

When it comes to audits, no one is immune. Even the best of us are bound to be subject to a pre-pay review or RAC audit, no matter how thorough our documentation practices may be.

With the number of audits on the rise, DMEPOS consultant Andrea Stark offers suppliers the following strategies to lessen audit risk:

1. For diagnosis driven products, make a cheat sheet of covered diagnosis codes and the most common corresponding HCPCS. Screen claims against the sheet to ensure HCPCS have the appropriate diagnosis code before sending them out the door. Your billing software may allow you to set up special edits to automate this.
2. Make a list of HCPCS that require the KX modifier for payment and set up an edit to ensure that these codes don’t inadvertently go out the door without the appropriate modifiers and documentation on file.
3. Periodically audit your referral sources. If you find a physician does not have good charting practices, consider educating them and eventually refusing orders if they continually fail to provide adequate documentation.
4. Conduct self audits. Pull a sample of patient claims for specific product categories and review them for missing modifiers, documentation requirements, etc. This will help you identify training issues and correct billing errors at the source.
5. Know the medical policy requirements for your product and pre-screen your customers to ensure they truly have a covered condition.

See Andrea discuss the current state of audits and what suppliers can do on HME News TV: http://www.hmenews.com/video.php?cat_id=2&v_id=175.

By: Michelle Hamel

We’ve all heard the saying, the numbers don’t lie. But almost every one of us knows how easy it is for statistics or figures to be manipulated or mis-interpreted. Take, for example, the latest Medicare Fee-For-Service Payments Report released by the Comprehensive Error Rate Testing (CERT) team, which shows that during fiscal year 2009:

• Medicare overpaid DME suppliers by $5.4 billion.
• 51.9% of all DME claims were improperly paid.

Looks bad, right? In a time when healthcare reform is front-and-center in congress and reducing Medicare waste is one of the biggest targets, these figures seem to paint a giant bulls-eye on an industry already suffocating under a chokehold of new billing regulations. In fact, we’ve all born witness to reports in the media showing how this DME product is overpaid or how easy it is for that DME product to be billed fraudulently.

But what if I told you the reason these figures are so high isn’t because Medicare is using poor judgment when paying claims, but rather the result of a regulation crack-down? I know… reason stands that if payments are being made more stringently, then the error rate should be lower, not higher, but bear with me here.

As any supplier in today’s DME industry can attest to, getting payments for legitimate claims is harder than ever before. With accreditation and surety bond requirements, increased scrutiny from CMS and the pending implementation of PECOS, many of today’s suppliers are struggling to stay afloat in a sea of ever-changing regulations. And if you’ve recently undergone an audit, you know firsthand that it’s a whole new ball game. (For an easy way to keep up-to-date on Medicare reimbursement requirements, see Vista Notes.)

So how does this impact the overpayment and paid error rate figures above?

Anyone who happens to do more than glaze over the initial statistics, will find that the CERT team attributes 2009′s high error rates directly to an increased enforcement of documentation requirements and a decrease in the allowance of contractor judgment.

“In the past, reviewers applied clinical review judgment to claims to fill in the gaps of knowledge where documentation was missing. Once CMS clarified that clinical review judgment may not override documentation requirements, more errors were found on DME items. Additionally, it is often more difficult for DME contractors to obtain the proper documentation because they request documentation from the supplier who billed for the item, not the medical professional who ordered the item. The supplier then is responsible for submitting documentation to CMS that they have collected from the ordering provider. The involvement of multiple parties can cause a delay in documentation receipt and incomplete documentation. CMS also recently clarified that documentation produced by the supplier alone is insufficient to warrant payment of the claim.”

As unfair as it may seem for a supplier’s claim to be denied due to the physician’s failure to dot all the i’s and cross all the t’s, suppliers are ultimately responsible for ensuring documentation requirements for the services they provide have been met.

The increased payment error rates are also partially attributable to a new policy (implemented by CMS at the recommendation of the OIG) that prevents audit contractors from looking at a claim’s billing history as an additional source of information. CERT provides the following example of how a once payable claim was denied during a review based on this new policy.

“CERT reviewed a claim for a bedside commode. The supplier provided the treating physician’s signed and dated order to the CERT Contractor indicating a 79 year old patient was recovering from a total knee replacement. A review of claims history showed the beneficiary had a Medicare covered inpatient hospital stay for total knee replacement with a comorbid diagnosis of urinary tract infection shortly before this claim. The policy states a commode is covered when the patient is physically incapable of using regular toilet facilities. The CERT Contractor would have previously determined that the total knee replacement combined with the urgency of urination associated with a urinary tract infection was sufficient to meet this requirement. Now, however, the CERT contractor may not use claims history as a basis for payment. CERT would not know the patient had urinary incontinence unless a medical record indicating the condition was also submitted.”

And to top it all off, previously paid claims with illegible physician signatures are now receiving requests for recoupment as well. This is a scary thought for suppliers, as virtually every claim is subject to denial based on this technicality. Let’s face it; have you ever been able to read your doctor’s handwriting, much less their signature?

“In the past, if the provider’s signature was missing or illegible, and there were no other reasons for denial of the claim, the CERT contractor did not deny the claim. After consultation with the OIG, CMS issued instructions to the CERT contractor directing them to strictly adhere to the CMS policy requiring a legible identifier.”

If one of your claims is being audited and the physician signature is illegible, we recommend that you proactively get an attestation statement from your physician certifying that the signature is indeed theirs. (For information on how to develop a thorough intake process, including physician signature and documentation requirements for general DME, download DME Billing 101.)

So what does all this say about 2009′s $5.4 billion in overpayments and the 51.9% error rate?

In a nutshell, legitimate payments that otherwise would not have been denied are now being audited and recouped based on technicalities. What these numbers show is not that Medicare is improperly paying claims where there is no true medical need. Rather, they represent the learning curve taking place as DME suppliers transition from a Medicare world with a “read between the lines” grey area, into a sink or swim world of only black and white.

Finally! There’s good news for providers worried about the number of PECOS warning messages on their GenResponse Reports. In a statement released today, CMS announced that they have completed a systematic update of the PECOS system, in which NPIs have been added to the enrollment records of all physicians / non-physician practitioners.

Many physicians were added to PECOS prior to May 2008, when the NPI became a mandatory identifier. Because the new claim edits look for a physician’s NPI first, these incomplete records have been firing warning messages identical to the problem physicians who had no PECOS record at all. Until now, providers had no way of telling whether a flagged physician just needed to update their information or go through the entire PECOS enrollment process, based on the warnings alone.

Now that the NPI update is complete, suppliers should see a definite decrease in the number of C200, C201 and C202 warning messages on their GenReports. However, this does not negate the need for action. Unless there is an uncorrected spelling or NPI error in your billing software, these physicians must be educated on the PECOS edits and complete enrollment prior to April 5, 2010, or your claims will result in rejections.

CMS has also promised to release an internet-based tool that will allow providers to scrub a physician’s NPI against those listed in the PECOS database. The tool will be made available prior to the start of rejections (currently scheduled for April 5, 2010); however no specific release date has been provided.

(See: http://oig.hhs.gov/publications/docs/workplan/2010/Work_Plan_FY_2010.pdf)

The Office of Inspector General (OIG) has released its 2010 fiscal year Work Plan. The Work Plan outlines which areas within the Department of Health and Human Services (HHS) are currently on the OIG’s radar for assessment and audit. Per the OIG’s mission statement, the goal of their investigations is to “protect program integrity and the well-being of program beneficiaries by detecting and preventing waste, fraud, and abuse; identifying opportunities to improve program economy, efficiency, and effectiveness; and holding accountable those who do not meet program requirements or who violate Federal laws.”

Per the Work Plan, effective October 2009, the OIG will begin examining the following DMEPOS reimbursements, regulations and programs for compliance issues or areas in need of improvement: 

• Physician Self-Referral for DME Services
• Medicare Payments for Various Categories of DME
  • Includes: power mobility devices (scooters), hospital beds, oxygen concentrators and enteral/Parenteral nutrition.
• Medicare Payments for DME Claims with Modifiers
• Comprehensive Error Rate Testing (CERT) Program: DME Corrective Actions
• Appropriateness of DME Categorization
• Enteral Nutrition Therapy Services in Nursing Homes
• Medicare Pricing for Parenteral Nutrition
• Medicare Part B Payments for Home Blood-Glucose-Testing Supplies
• Medicare Payments for Power Wheelchairs
• Medicare Payments to DME Suppliers of Power Wheelchairs
• Repair and Servicing of Capped Rental Durable Medical Equipment
• Medicare Enrollment and Monitoring for Supplier of DMEPOS and Home Health Agencies

Upon completion of an investigation, the OIG has the authority to suggest improvements, impose civil monetary penalties (CMPs) and even impose administrative sanctions.

Specific details on what the OIG will be looking for in each of the above investigations, as well as any actions or audits implemented as a result of an investigation will be included in the December issue of Vista Notes.

Not yet a Vista Notes subscriber? Visit our Products page and add a subscription to your cart today, or contact info@miravistallc.com.

The Jurisdiction C DME MAC has identified a large number of improper payments for oxygen and CPAP claims. As a result, CIGNA is implementing a service-specific prepayment review.

Providers in Jurisdiction C who have submitted claims for oxygen or for CPAP devices (E0601) may receive an audit letter from CIGNA requesting they provide additional documentation to support their claims.

If you receive an audit letter you should submit all supporting documentation as soon as possible. For oxygen providers, CIGNA must receive all requested documents within 45-days of the date on the letter. For CPAP audits, only 30-days are allotted. If CIGNA does not receive the requested documentation within those time frames your claim will be denied.

Oxygen Audits:

Per CIGNA, oxygen providers should be prepared to return the following documentation upon request:

• CMNs associated with the service date being audited (including Initial, Revised and Recertification CMNs as applicable)
• A Physician’s Order
• Blood Gas or Oxygen Saturation Test Results
• Proof of Delivery

When responding to oxygen audits, consider the unique requirements for recertified oxygen patients:

• To recertify Group 2 patients, a second qualifying retest must be conducted within 61-90 days of the initial qualifying test.  (You should submit the test results from both the first and second qualifying tests.)
• To recertify Group 1 patients, the patient must be re-seen (not retested) by their doctor after 9 months of oxygen use.  (You may want to request chart notes from the visit, which should address the oxygen therapy.)

Also keep in mind that patients tested during sleep are required to have two test result values, 1) at rest (awake) with non-qualifying oxygen levels (over 89% or 59 mmHg) and 2) at sleep with qualifying saturation levels (below 89% or 59 mmHg), unless the patient shows a decrease of more than 10 mmHg or more than 5% saturation for at least 5 minutes.

For patients being qualified upon exertion, three tests must be obtained: 

1. At rest, where the patient does not qualify.
2. Upon exertion (without oxygen), where the patient does qualify.
3. Upon exertion (with oxygen), where the patient improves.

• Recently, the oxygen LCD was revised to require that all three tests be performed within the same setting; otherwise, the results will be invalidated. It is important to note that the LCD revision was not published until June 2009 with a retroactive effective date. Therefore, if the patient was tested between 01/2009 and 06/2009, there should be grounds to uphold tests that were not conducted on the same day, but were conducted succinctly together.

CPAP Audits:

Providers who have submitted claims for HCPCS E0601 that were set up on or after 11/2/2008, should have the following documentation on file:

• A Physician’s Order
• Documentation (chart notes) from the initial and follow-up Face-to-Face Evaluations
• A copy of the Sleep Test
• Documentation of Adherence to Therapy (evidence of the 30 day compliance log)
• Proof of Delivery and Product Information

When responding to CPAP audits, please remember that for on-going supplies, you must be able to provide documentation (via phone logs or other means of routine contact with the patient), which shows the patient authorized delivery of the supplies.  You may call a patient to request authorization to send refills/supplies no sooner than 7 days before their next shipment is due.  Authorization must be obtained before EVERY shipment. “Standing” authorizations are not permitted.