Angela Hayden & Andrea Stark

Originally set to go into effect on May 1^st, PECOS Phase 2 has been delayed…again. CMS issued word of the delay via their website citing technical issues with the claim processing side for correctly applying the PECOS edits that would have caused erroneous rejections.  Specific information was not released regarding a timeframe for when the new deadline would be set.  So for now, providers have an opportunity to complete their internal review process and avoid immediate claim denials.

Providers are familiar with the many delays that have affected the PECOS project.  Due to repeated delays, Phase 1 has essentially been in effect for 3.5 years in one form or another;  represented to providers via GEN response rejections (pre-5010) then as N544 remark codes on remittance advices (post-5010).

In March 2013, CMS announced that May 1st would be the Phase 2 implementation date.   Yet five days prior to implementation, we have another delay.  What does that mean to providers?  At MiraVista we are advising providers “Don’t get too comfortable”.  The delay is due to a technical issue and is not intended to offer providers a substantial break.  We have no way to officially determine when a resolution will occur, but these types of minor issues can be fixed in as little as 30 days. As such, providers should continue to review their records and ensure accuracy to be prepared for implementation.

Another important announcement took place on April 24^th, which was the introduction of HR 1717 by Congressman Tom Price of Georgia.  Price kept to his word and introduced new legislation to repeal and replace the current Competitive Bidding Program with the Market Pricing Program (MPP).  The bill text was released by Congressman Price’s office and proposes an end to Round 1 pricing effective December 31, 2013.  The legislation also calls for an immediate cease to both Round 2 implementation and National Mail Order, suggesting the termination of any awarded contracts under these programs.  These are hefty requests that are accompanied by a detailed plan of action for the transitional period between the termination of Competitive Bidding and the implementation of MPP.  This transitional plan is an important part of the legislation in order to gain a budget neutral score by the Congressional Budget Office (CBO).  We will keep you up-to-date as we continue to review the legislation and monitor its progress.

Providers are encouraged to reach out to their Representatives to gather support for the new legislation. AAHomecare has provided a template letter to assist in this process which can be accessed here: http://action.aahomecare.org/9244/stop-medicare-bidding-program-home-medical-equipment/.   The bill was introduced with a total of 25 co-sponsors, so be sure to reach out and thank those congressional members who are in support of this pivotal piece of legislation.  Providers can also show their support by joining AAHomecare on Capitol Hill for the Washington Legislative Conference on May 22-23^rd to lobby on behalf of the DME industry (Register here: https://www.aahomecare.org/events/2013/5/washington-legislative-conference)

Bill Text: http://tomprice.house.gov/sites/tomprice.house.gov/files/HR%201717.pdf

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.

Derrick B. Stark, CPA

Quite by accident, I recently stumbled across this classic scene from the television show, I Love Lucy.  While I have seen the clip of Lucy stuffing chocolates into her face, I never knew it was part of a larger scene.  Now that I appreciate the entire story arch, I submit this is the perfect parable illustrating the importance of process in medical billing.  If those chocolates were insurance claims, it would cease to be a metaphor.

Management by Ultimatum

To be clear, this is a parody.  I don’t think managers intend to step into the billing cubicles each morning and explicitly threaten jobs…at least not in the beginning.  They do, however, operate under the impression that individual line workers have complete control over outcomes based on their abilities and efforts; chocolates produced, claims paid, and so forth. Managers that do not give credence to the importance of the predecessor operations, such as the kitchen for Lucy or the intake department for medical billing, cannot factor the incremental effort to catch up once the process gets behind. And so, they inadvertently deliver an ultimatum to subordinates and co-workers: deliver or else.

Overloading the System

Listen.

Lucy and Ethel know how to wrap chocolates.  Everything is swell until the conveyor belt speeds up and no one stops to see if the system downstream can handle the increased speed and volume. In medical billing, we have our own turbo charged conveyor belts:

• Increased patient referrals from new or growing referral sources
• Increased effort required to get adequate documentation from said referral sources
• Audit activity
• Changes in protocols like 5010 and ICD-10
• Software issues
• Short staffed days due to co-worker illness, vacation, or acts of God

Like Lucy and Ethel, billers often need to manage increasing levels of inputs, but they do not have control of the entire ecosystem. Assuming they possess at least average ability, blaming subpar results exclusively on the Lucies (Lucy’s? Luci?) and Ethels of the process is actually a management, not a billing, failure.

“I think we are fighting a losing game”

There comes a time when Lucy realizes she is in over her head. She says so explicitly, but only to her co-workers…not to anyone that actually has authority to do something about the situation. Instead of summoning the manager or communicating with the kitchen or simply taking a break so she can assess the situation, she begins…

Hiding the Evidence

Watching this scene, Lucy and Ethel are not trying to mislead, they are trying to keep up. What starts off as setting aside a few chocolates for later to catch up quickly becomes a train wreck. Chaos ensues. Even the chocolates that get wrapped in the end are sloppy because the whole process is out of control. Any chance of neatly wrapped chocolate is toast. Competent staff is made a laughing stock because the system’s capacity was simply overloaded.

Speed It Up (Or Maybe Not So Much)

The punch line, of course, is when the line boss superficially observes that everything is going well and shouts “Speed it up!” By speeding it up, even fewer quality chocolates will be produced. This is probably the most damning for me personally. Admittedly, I really only know how to measure capacity by incrementally increasing the load until productivity starts to wane. But this clip made me wonder, “Am I, too, only looking superficially to see what I want to see? Do I seek only evidence of the one predetermined answer?” Gosh, I hope not.

The lesson in my mind is that any process for making something, whether it be chocolates or compliant medical insurance claims, is almost always a component in a much larger ecosystem. Discounting the natural limitations is dangerous. Everyone involved has a responsibility to actively communicate, and in the case of pending overload, slow down and solve the real problem.

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.

Just as a reminder, if you sell an item to a beneficiary that wants to pay you cash and not use their Medicare benefits, you must procure an Advance Beneficiary Notice (ABN) where the beneficiary selects the option to waive their rights.  But it is not as simple as just getting a signature and checking the right box… you must also disclose any reasons you believe the claim would likely deny IF you were to file the claim.  Waiving benefits doesn’t give you a pass on documentation collection or medical necessity verification.

The reason you must go this extra step is because the waiver of Medicare benefits is a revocable designation.  At any time in the future if the beneficiary changes their mind and wants you to file a claim (or if the caretakers get involved and insist you file), you will be obligated to do so.  In the event that the claim is filed and then denies for medical necessity reasons (that were NOT disclosed to the beneficiary in writing), you will be back on the hook to refund monies you collected.  So, do the leg work… make sure that the protections you intended to have at setup are still there waiting for you in the eventual case you have to file that claim.

While there can be profit in the retail market, there are still pitfalls to be mindful of.  This is just one of the can’t miss topics to be discussed in our upcoming webinar with Andrea Stark and healthcare attorney Jeff Baird on Jan 15.  For the last three years, HME News has had Andrea and Jeff present a candid and practical update for the coming year.  In this webinar they’ll tackle entry into cash and internet sales market place, what you should, can and cannot do with regards to patient collections, and common sense protections to ensure you are not left in the wake of the technology revolution.

You can register for this event or reserve a digital recording through our website using the Seminars and Webinars link. Seats are limited so register today!

Andrea Stark and Angela Hayden

It’s that time of year again; deductible season will soon be in full swing. The Medicare deductible is up $7.00 from last year bringing it to $147.00. The first approved claims of the year will be passed to the patients’ deductible and forwarded to the secondary insurance/patient until the deductible is met. Both DME claims and Part B services share the same deductible. While state Medicaid programs will cover the Medicare deductible, most commercial insurance payers pass the cost on to their own deductibles leaving you to pursue the patient.

Providers can utilize real-time eligibility to determine the amount of the beneficiaries’ unmet deductible before processing claims. Beneficiaries with recurring rentals should be notified in advance that they will be required to cover the deductible. Providers do have the right to collect the patient deductible upfront prior to submitting claims.

Some billing software vendors have a built-in feature for deductible holds that will run eligibility automatically to notify you of cases where the deductible has not been met to allow you to proactively attempt collections. In this process claims are held until the deductible has been met.  Contact your billing software vendor to find out what options are offered. If your software does not have this feature, eligibility can also be accessed via the online portals provided by the jurisdictions below:

• NHIC – PSP (Provider Services Portal)
• National Government Services – Connex
• CIGNA Government Services – (Provider Portal is not yet active)
• Noridian Administrative Services – Endeavor

Additionally, providers can take advantage of Claim Status Inquiry (CSI) services through Ivans, Ability or another approved Network Service Vendor (NSV). Search for the term “CSI” on your Jurisdiction’s website for additional details and enrollment information.

Beneficiaries with setups during deductible season and those beneficiaries with recurring rentals or supplies should be educated regarding the deductible. Beneficiaries are responsible for the unpaid deductible as well as the Medicare premium and 20% co-insurance. Notifying patients will likely reduce call volume for those with questions concerning deductibles as it comes across in EOBs. 

Andrea Stark

The DME MACs continue to push buttons and create uncertainty for providers that provide consumable supplies on a regular basis. A recent bulletin takes a pretty swift shot at providers that utilize automated Voice Recognition software and technology to efficiently process refill requests for consumable supplies such as ostomy, urological supplies, surgical dressings, diabetic testing supplies, etc.

Prior to sending out refills suppliers must determine the quantity of each item the beneficiary has on hand.

In the educational articles posted by the MACs (see links below) they have taken a position that questions that result in a Yes or No response will not be accepted as meeting the documentation burden. Questions that spoon feed beneficiaries and only capture an amount of supplies the beneficiary is requesting or responses to questions stating the beneficiary has less than “X” number of days remaining are all considered vague and non-specific, and the contractors will not justify reimbursement based on this captured data. The article further stipulates that the MACs prefer (although they do not require) an actual count of supplies remaining. Basically if your questions produce an identical response from multiple beneficiaries it is likely to be discounted.

So can we continue to use IVRs without risk of incurring audit risk? That is a good question! We are requesting additional dialogue with CMS on these directives and hope to procure a more liberal take on what can and cannot satisfy this requirement. While we maintain the MACs are taking an overly restrictive position beyond the scope of what SHOULD be required to meet this burden, they have put their cards on the table and providers have to adapt accordingly. In light of the directives, MiraVista recommends that scripts be modified to require a unique response from beneficiaries by asking open ended questions. We believe that if the provider asks “How many days of supply do you have remaining?” or “When do you expect that you will run out of your current supply?”, that CMS will have to accept the answer as a unique response. If using an IVR system it is preferred that you collect an individual, open response from the beneficiary to establish compliance with the current CMS requirements. You could model your question along the lines of the following:

“Please take a moment and assess how much supply you have remaining, and then answer the following question: How many days’ worth of supplies do you have left? Enter a two-digit representation for the number of days remaining: 1 day should be entered as 0-1, 14 days as 1-4.”

In cases where the response indicates the beneficiary has more than 10 days worth of supply remaining, your shipment should be delayed or the beneficiary should be personally contacted to verify the response.

This is a featured article from the December 2012 edition of VistaNotes.

Links:

http://www.medicarenhic.com/dme/medical_review/mr_bulletins/

 http://www.cgsmedicare.com/jc/pubs/news/2012/1012/cope20351.html

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.

Can’t see the video below? Click this link! (Plays on Windows Media Player)

Andrea and Derrick Stark will be presenting several sessions at Medtrade in Atlanta, GA on October 24-26, 2011 and would love the opportunity to speak with you in person!

For detailed information on their course offerings, watch the video above, then visit: http://www.medtrade.com/medtrade/conference/conference-schedule. 

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