[Ed. Note -- Excerpt from a report filed via telephone from a RAC Shadow Agent. ]
Past months have been loaded with plenty of work to respond to the activities of HMS, the agency used by both CMS for MIC audits for Colorado as well as contracted by the state as a Medicaid “RAC”. The earliest communications from HMS as the MIC was one request for 400+ outpatient records, which we were told all related to unbundling.
Many months later (almost a year), we received the review results for those 400 records we copied and sent in: no further action required at this time.
[The following is a report filed via telephone from a RAC Shadow Agent in Colorado. We have paraphrased the report to keep it short. All Agents are encouraged to report to the Agency any such activites, materials or commentary, to share with your fellow RAC Shadow Agents. -- RB]
Past months have been loaded with plenty of work to respond to the activities of HMS, the agency used by both CMS for MIC audits for Colorado as well as contracted by the state as a Medicaid “RAC”. The earliest communications from HMS as the MIC was one request for 400+ outpatient records, which we were told all related to unbundling.
Many months later (almost a year), we received the review results for those 400 records we copied and sent in: no further action required at this time.
No further explanation was forthcoming, either. So… they made us locate, copy and deliver 400 records, then months later tell us, “Never mind.” Who makes these decisions?
Under the guidance of Colorado Medicaid, HMS is contracted for “DRG Education and Review” and we have received a series of records requests over the last 3-4 years, sent to us under the guise of “DRG Education.”
DRG Education?
Meanwhile, these other records, requested for “DRG Education” (for whose education, we’ve wondered), began to return to us with denials for Medical Necessity! We weren’t the only one receiving such denials, and many hospitals complained. A huge meeting ensued, it was very tense, and finally Colorado Medicaid relented, claiming HMS should only conduct DRG Validations on those requested records. Many providers also questioned the qualifications of the auditors and physician advisors, to no avail at that time.
The program seems to have settled down in the last couple of years to being two ADRs a year for the larger hospitals and just one for smaller hospitals. Each ADR is for about 90-100 records. These results tend to come back within 3-6 months.
Also, despite the statements by HMS at the earliest meetings with providers, we did receive some denials this past February for “wrong setting” — which is just another name for a medical necessity denial. So much for DRG Education.
Next Focus: Valid Orders
The next problem identified was a lack of a valid order for patient status. We have a process in place that uses a form for establishing an initial physician’s order, which can be done via phone. The form is then later signed, within an appropriate time frame, and all is well. But… sometimes the physician signs the form, but forgets to date and time it! Bingo… denial for lack of a valid order, end of story, lose all the money, way too late to do anything about it.
The Latest Focus: Billing Errors
Lately, they’ve been going after miscellaneous billing areas, looking at readmissions in less than 48 hours (reduced to 24 hours in this new fiscal year), which, under our system, we automatically combine with the previous admission. Despite our best efforts we’re still having these claims reviewed. They also look at each case for appropriate admission and discharge source codes to make sure these were captured correctly, since there is an opportunity to reduce our reimbursement if not done correctly.
And Along Comes… the OIG
I should also mention what the OIG has been doing out here. In the late Spring, the OIG arrived, wanting to review DRGs, but then mostly focused on cost outliers. Obviously, they wanted to question the charges involved, in order to decrease the overall bill and therefore potentially reduce the reimbursement.
Now, who do you expect that they would send to make such determinations? One might reasonably expect an RN. The lead auditor was an RN, but he did not work on the medical necessity reviews – he assigned another auditor. How about a coder? No coders or billers. Last chance — how about a CPA? Here we hit a small break. Two of the four auditors were CPA’s. In fact, the auditors had little expertise in healthcare whatsoever, and relied on our staff to actually review the medical record/charges to defend charges, explain medical necessity and point out any errors to the auditors. Evidently, the only reason the files are being reviewed is because they are outliers, period. No other analysis, no other flags, just the fact that they are outside the norm. This includes cost outliers as well as possible over-reimbursement with the use of the -59 modifier, and review of billing for devices received at no-cost or partial cost to the hospital.
[Ed. Note -- We're posting a comment area for this report in the Medicaid RACs Group, in case you care to comment, or you can comment here, publically as well. If you happen to have any information like this to post, either do so yourself, or send an email to blog@RACShadow.org and we'll see that it gets posted here... ]
