The Center for Medicare & Medicaid Services (CMS) released the Final Rule for SNF PPS and consolidated billing for fiscal year (FY) 2012 on Friday, July 29. An important provision included in this rule would reduce Medicare SNF PPS payments in FY 2012 by $3.87 billion, or 11.1% lower than payments for FY 2011. CMS states that the reason for this rate reduction is to correct for an unintended spike in payment levels and better align Medicare payments with costs.
CMS is committed to providing high quality care to those in skilled nursing facilities and to pay those facilities properly for that care, said CMS Administrator Donald M. Berwick, MD, in the CMS press release. The adjustments to the payment rates for next year reflect that policy.
CMS is blaming the spike in payment levels, which they are now trying to correct with lower payments in 2012, on a forecast error that occurred with the transition from RUG-III to RUG-IV. According to the CMS press release, the parity adjustment made in FY 2011, which was intended to ensure that the new RUG-IV system would not change overall spending levels from the prior year, instead resulted in a significant increase in Medicare expenditures. This increase was mainly due to shifts in the utilization of therapy modes under RUG-IV differing significantly from the projections on which the parity adjustment was based.
Facilities that are primarily focused on rehab will experience the hardest hit due to these rate cuts, says Diane L. Brown, BA, regulatory specialist and Boot Camp instructor at HCPro, Inc., in Danvers, MA. "But those facilities that have a more traditional case mix that balances residents in therapy and residents spread across the clinical RUG categories won't feel the effects of a full 11.1% decrease."
Along with the payment updates, the SNF PPS Final Rule for 2012 includes a few other significant changes for nursing facilities. Some of these changes are as follows:
Affordable Care Act initiatives:
CMS is in the process of developing the SNF value based purchasing plan and will submit a report to Congress by October 1, 2011.
The Secretary of the Department of Health and Human Services (HHS) will evaluate the possibility of expanding the hospital-acquired condition policy from acute care hospitals to a variety of other settings, including SNFs, and will submit a report to Congress by January 1, 2012.
Nursing home transparency and improvement. This will require SNFs to report expenditures separately for direct care staff wages and benefits on the Medicare cost report, for cost reporting periods beginning on or after two years after enactment, and also requires the Secretary of HHS to perform certain related activities.
Therapy student supervision: The Final Rule will discontinue the policy requiring lineof-sight supervision of therapy students in SNFs. Instead, effective October 1, 2011, each SNF will determine for itself the appropriate manner of supervision of therapy students consistent with state and local laws and practice standards.
Group therapy clarifications: Effective October 1, 2011, group therapy will be defined as therapy provided simultaneously to four patients who are performing the same or similar activities, and group therapy time will be divided by four in determining the reimbursable therapy minutes for each group therapy participant and, therefore, the appropriate RUG-IV group.
Five- or seven-day a week therapy clarification: Elimination of the distinction between facilities regularly furnishing therapy services on a 5- or 7-day basis for purposes of setting the date for the End of Therapy (EOT) Other Medicare Required Assessment (OMRA).
Introduction of the End of Therapy Resumption (EOT-R) OMRA: Effective for services provided on or after October 1, 2011, when an EOT OMRA has been completed and therapy subsequently resumes, SNFs may complete an EOT-R OMRA rather than a Start of Therapy (SOT) OMRA, in cases where the resumption of therapy date is no more than five consecutive days after the last day of therapy provided and the therapy services have resumed at the same RUG-IV level that had been in effect prior to the EOT OMRA.
Introduction of the Change of Therapy (COT) OMRA: Effective for services provided on or after October 1, 2011, SNFs would be required to complete a COT OMRA for patients classified into a RUG-IV therapy group whenever the intensity of therapy (that is, the total reimbursable therapy minutes provided) changes to such a degree that it would no longer reflect the RUG-IV classification and payment assigned for a given SNF resident based on that resident's most recent assessment used for Medicare payment.
The ARD of the COT OMRA would be set for day seven of a COT observation period, which is a successive seven-day window beginning on the day following the ARD set for the most recent scheduled or unscheduled PPS assessment and ending every seven calendar days thereafter.
Changes to MDS 3.0 SNF PPS assessment schedule: The Final Rule modifies the Medicare-required assessment schedule to incorporate new assessment windows and grace days to capture more appropriately the changes in patients status, in-services, and treatments provided over the course of the stay. This will also reduce the possibility that information from the same days of the stay may be used on different scheduled MDS assessments.
To read the SNF PPS Final Rule for FY 2012 in its entirety, visit the Resources page on MDSCentral. Also, stay tuned to MDSCentral in the coming weeks for more news and analysis on this final rule.
During the American Health Information Management Association's (AHIMA) Long-Term and Post-Acute Care (LTPAC) Health Information Technology (HIT) Summit, held June 7-8 in Baltimore, MD, industry leaders and representatives from a variety of organizations met to discuss the future of HIT in LTPAC settings.
Eric Dishman, director of health innovation and policy at Intel Corporation and the keynote speaker, kicked off the summit with a presentation on the shift away from long-term care facilities to home and community-based care in the near future.
This model of care is very different from the current model of institutionalized long-term care and will transform how providers deliver services and brand their organizations. During his presentation, Dishman outlined the major building blocks of community-based care systems, which are as follows:
Care coordination
Telehealth/e-care capabilities
Social network/online communities
Virtual call center capability
Remote fleet management
Service aggregation
Broadband to community
Volunteer training/management
Dishman believes that to successfully build community-based care systems, long-term care facilities will have to partner with other organizations, such as local businesses, physicians, dentists, and technology companies. In addition to partnerships, the community-based care model will also rely heavily on the use of electronic health records (EHR) and the interoperability of HIT systems, which were main focuses of discussions throughout the summit.
Although LTPAC providers were not included in the EHR adoption incentive program of the Health Information Technology for Economic and Clinical Health (HITECH) Act, speakers at the AHIMA summit emphasized the importance of EHR use by these providers. One reason for LTPAC providers to begin EHR adoption efforts is that incentive programs may eventually be expanded to include these providers.
As outlined in the LTPAC HIT Roadmap for 2010-2012, which was unveiled at the summit, the LTPAC Collaborative will be "advocating for full participation, consideration, and benefits for LTPAC providers in national, state, and regional HIT incentives, investments, and initiatives." In addition, the HITECH Act requires the secretary to conduct a study on whether incentive payments for EHR adoption should be available to other providers.
According to Jennie Harvell, M.ed., senior policy analyst in the Office of the Assistant Secretary for Planning and Evaluation at the Department of Health and Human Services, this study should be completed in October and delivered to Congress in December. LTPAC organizations that begin EHR adoption and implementation efforts now will be in better positions if and when incentive programs are expanded to include other providers.
Implementing EHRs is a step in the right direction, but providers will reach a stand-still if their HIT and EHR systems are not interoperable, meaning information cannot be exchanged with other providers. Currently, a major barrier to interoperability between LTPAC providers is the inability to compare information collected using the different assessment tools—nursing homes use the MDS, home health agencies use the Outcome and Assessment Information Set (OASIS), and inpatient rehabilitation facilities (IRF) use the patient assessment instrument (PAI).
CMS is in the process of exploring one solution to this problem with the Post-Acute Care Payment Reform Demonstration (PAC-PRD), which makes use of the Continuity, Assessment, Record, and Evaluation (CARE) instrument.
The CARE instrument is an assessment tool that can be used by SNFs, home health agencies, and IRFs, instead of their respective assessment instruments. During the summit, Shannon Flood, technical project officer for PAC-PRD in CMS' Office of Research Development and Information, informed attendees that CMS is finished with the data collection phase of the demonstration and is currently doing analysis. "We plan to submit recommendations for payment reform next year, but will need congressional authority to then move forward," Flood said.
When asked if the CARE tool could be tied to payment bundling projects in the future, Flood responded, "Maybe. The long-term goal would be to combine the MDS, OASIS, and the PAI into one. But we really are at a pre-policy decision point."
Although a wide variety of technology-related topics were covered during AHIMA's LTPAC HIT Summit, the overall message was clear: healthcare is becoming more and more reliant on technology and LTPAC providers must adapt to the changing industry if they want to remain valuable players in the field.
The Minimum Data Set, Version 3.0 (MDS 3.0) Train-the-Trainer conference held in Baltimore April 13-15 provided attendees with a wealth of information regarding the new long-term care assessment tool, which will be implemented in October.
During the conference, officials from the Center for Medicare & Medicaid Services (CMS) and other speakers provided an overview of the MDS 3.0, step-by-step coding explanations for multiple sections, and interesting information regarding the delay of Resource Utilization Group, Version Four (RUG-IV) and changes to the MDS 3.0 and Resident Assessment Instrument (RAI) User's Manual.
Some of the major updates include the following:
If the partial RUG-IV delay is implemented as outlined in healthcare reform, CMS will have to do some work on the back-end of things to transform the RUG-IV grouper determined by the MDS 3.0 back into a RUG-III grouper for payment. CMS officials said that the modified system would not be in place for the October implementation of the MDS 3.0 and may not be ready until the end of the year. They did not give a definitive answer about how payments to facilities will be affected by this. When CMS figures out a transition approach and what tool will be used during this time, they will inform providers. However, CMS officials are working to have RUG-IV implemented on October 1, 2010 (as originally planned) and seemed to think there is still a chance that this will occur.
The timeline to change the items on the MDS 3.0 to be implemented in October has already passed, so any changes to the item sets will just be to clarify the language, not to the actual items. However, CMS said there will be revisions to the item sets in early or mid 2011.
An updated version of the RAI User's Manual is expected for late May or early June. CMS will release the sections as they are finished, rather than hold the sections until the entire revised manual is ready. The revisions will mostly be to clarify the coding and assessment rules.
After the October implementation of the MDS 3.0, nursing facilities will not be able to access the Quality Measure and Quality Indicator (QM/QI) reports for a number of months.
A new draft of Appendix P and PP of the State Operations Manual is expected to be released in early August. Some of the changes included in these appendices will address modifications to the survey process while the QM/QI reports are not available.
The updated RAI User's Manual will change the MDS transmission date for the admission, annual, significant change in status, and significant correction to prior comprehensive assessments. The RAI User's Manual released in January lists the transmission date for these assessments as no later than the MDS/Care Area Assessment (CAA) completion date + 14 days. The revised manual will change the transmission date for these assessments to be no later than the care plan completion date + 14 days. The care plan must be completed within seven calendar days after the MDS and CAA completion date.
The updated RAI User's Manual will change the timeframe to conduct the Resident Mood Interview (PHQ-9). Although preferred, the PHQ-9 interview will no longer be required to be conducted the day before or the day of the assessment reference date (ARD). CMS officials did recommend that the resident interview be conducted as close to the ARD as possible.
There is still a lot up in the air and CMS seems to be taking all comments into consideration as they make their revisions to the RAI User's Manual. Stay tuned for more information and updates as we approach the October 1 implementation date.
The Department of Health and Human Services' (HHS) Office of Inspector General (OIG) recently released its Compendium of Unimplemented Office of Inspector General Recommendations, which highlights a variety of OIG recommendations that had not been fully implemented as of September 30, 2009.
A handful of the unimplemented recommendations included in the report are related to nursing homes:
Ensure that states properly maintain nurse aide registries
Update nurse aide training curriculum
Ensure that hospice claims for beneficiaries in nursing facilities comply with Medicare coverage requirements
Ensure that Part B payments are appropriate for beneficiaries' medical equipment during non-Part A nursing facility stays
Ensure that Medicare Part D excludes payments for drugs for beneficiaries in Part A skilled nursing facility stays
"Clearly, if implemented, the recommendations could have an effect on nursing facilities," says Wayne van Halem, AHFI, CFE, president of the van Halem Group, LLC, in Atlanta, GA. "Reviewing the information is an excellent source for facilities to determine focus of their own internal controls.
"For example, the document talks about training for nursing aides. Clearly, OIG found the training to be insufficient, as a provider should certainly have an effective training program in place for all employees as part of their regular compliance and control process. So, they may want to review their training programs for nursing aides."
The OIG report also includes a list of priority recommendations, which in the OIG's opinion "represent the most significant opportunities to positively impact HHS' programs." One of these priority recommendations was to ensure the appropriate processing of denial of Medicare payment remedies for noncompliant nursing homes.
"Some of these recommendations will never be implemented because CMS has come up with different solutions or it requires a change in legislation; however, some may very well be implemented," van Halem says. "More than anything else, this OIG report is a good resource for facilities."
Long-term care leaders spoke about how a federal program impedes nursing home residents from getting necessary medications at a Senate Special Committee on Aging hearing on Wednesday.
Both the American Association of Homes & Services for the Aging (AAHSA) and the National Community Pharmacists Association (NCPA) submitted written testimonies urging the committee to address the Drug Enforcement Agency's (DEA) interpretation of the Controlled Substance Act (CSA) that they said creates a barrier to providing nursing home residents with pain medication in a timely matter.
Nursing home physicians typically work for multiple facilities and are not always in the facility to provide written orders for prescriptions. Because of this, physicians sometimes communicate new orders for the resident over the telephone, especially when a resident's condition changes quickly. When this occurs, a nurse records the physician's verbal order in the resident's chart. This documentation is known as a "chart order."
If this chart order calls for a new prescription, the nurse faxes the chart order to a long-term care pharmacy for dispensing. Using the chart order to fill and dispense a prescription ensures "that medications are acquired on a timely basis to meet residents' changing and emergent medical needs," according to an AAHSA press release.
However, the DEA's interpretation of the CSA does not allow for controlled substances, such as many pain medications, to be filled based on nurses' chart orders. The DEA regulations require that a pharmacy can only fill and dispense controlled substances if they have a signed prescription from a physician.
According to the AAHSA press release, "This additional step means that nursing home residents may be forced to wait hours, or even days, to receive medication for pain, seizures, psychiatric, and end-of-life symptoms at times when physicians are hard to reach."
The industry-wide concern for this issue arose from the DEA's recent audits of multiple long-term care facilities and pharmacies for filling controlled substance prescriptions for nursing home residents based on chart orders.
"We believe that the DEA is undermining the ability of pharmacists to address controlled substance pain medications needs in long-term care facilities in a timely manner, which can lead to unnecessary suffering for residents with serious health challenges," Bruce T. Roberts, RPh, executive vice president and CEO of NCPA, said in a press release.
Both AAHSA and NCPA expressed interest in working with Congress and the DEA to establish a viable solution to this problem.
The health reform legislation passed in the House Sunday contains numerous provisions related to long-term care.
One of these provisions is the Community Living Assistance Services and Support (CLASS) Act, which was originally introduced by the late Senator Edward Kennedy. The CLASS Act will make long-term care insurance available to all Americans, who will be automatically enrolled with the choice to opt out.
Individuals will begin paying a premium immediately and, after five years, those with functional limitations have the option of receiving a cash benefit of around $50 a day that can be used to offset the cost of long-term care services.
"The CLASS Act will help offset the high cost of long-term care services for aging and disabled populations. In particular, these funds will allow individuals flexibility to receive services in their homes and potentially prevent admissions to nursing homes," says Katherine McCarthy, business account manager at PointRight in Lexington, MA. "The overarching goal of healthcare reform is to make healthcare both more accessible and affordable in the U.S. Long-term care expenses, particularly in aging populations, are among the most costly to Medicare and Medicaid today. By providing insurance, there is a real opportunity to reduce costs in this sector."
The bill also includes a provision to help close the Medicare Part D coverage gap for medications. According to the Senate’s summary of the Patient Protection and Affordable Care Act, "in order to have their drugs covered under the Medicare Part D program, drug manufacturers will provide a 50 percent discount to Part D beneficiaries for brand-name drugs and biologics purchased during the coverage gap beginning July 1, 2010. The initial coverage limit in the standard Part D benefit will be expanded by $500 for 2010."
The bill will implement much stricter guidelines in terms of ownership transparency of nursing home chains.
"This will allow patients and the public at large to better understand ownership and operational hierarchies that currently are difficult to identify. Making these changes in the industry will be challenging, particularly for large publically-owned chains," McCarthy says. "However, those of us in the industry are all very excited that the bill will extend the therapy caps exceptions process through 2010. At the end of this year, they will have to revisit this issue again, at which point we are all hopeful for a long-term fix that ensures patients are able to receive the care they need based on medical necessity, rather than an arbitrary cap on funding."
In addition to the healthcare reform bill, the House passed a reconciliation bill containing changes to the just-passed legislation, which will be sent to the Senate for final approval.
One of these amendments awaiting a final vote is an amendment to delay the implementation of Resource Utilization Group, Version Four (RUG-IV), by a year. RUG-IV was originally scheduled to be implemented alongside the MDS 3.0 in October, but the amendment to the healthcare bill will not allow RUG-IV to be implemented before October 1, 2011.
However, the amendment will still implement the MDS 3.0, concurrent therapy adjustment, and changes to the look-back period to ensure that only services provided after skilled nursing facility admission are counted toward RUG placement on October 1 of this year.
"The RUG-IV delay is not certain yet, but we will know more as the budget reconciliation process unfolds and expect an answer within the next few days," McCarthy says. "In my opinion, the RUG-IV delay is not a cost saver, and that a delay in the implementation of RUG-IV is unlikely, but we don't have any concrete information at this time."
McCarthy says long-term care faces challenges, but she is hopeful that it will continue to adapt.
"In my opinion, reform will be a hurdle for long-term care facilities and providers. While there will always be a need for nursing homes, healthcare reform does ultimately encourage greater usage of home care services or other residential options," McCarthy says. "But overall, this bill, and the spirit with which it was written, is good for everyone, because its main goal is to increase the number of insured substantially and improve both quality and access to care. The long-term care sector has proven their adaptability in the past, and I am certain we will see that in these changing times as well."
The Temporary Extension Act of 2010 (H.R. 4691) that aims to help unemployed Americans, including extending unemployment insurance and premium assistance for COBRA benefits, also extends the exceptions process for Medicare therapy caps to March 31, 2010.
The therapy caps were designed to put a limit on Medicare Part B reimbursement for therapy services. In 2010, this limit is $1,860 for physical therapy (PT) and speech language pathology (SLP) combined and $1,860 for occupational therapy (OT). Under the exceptions process, which was enacted in 2006, Medicare will continue to pay for therapy services in excess of the cap if the services are deemed to be medically necessary.
"Congress has voted on the therapy cap process for years and the last time this was in review was 2008," says Karen Connor, president and CEO of Connor LTC Consulting in Haverhill, MA. "Congress gave until 2010 to review this coverage for Medicare, but in January the coverage was not voted on and the therapy caps went back into play without an exceptions process."
H.R. 4691 extends the therapy cap exceptions process through March 31, 2010, retroactive to January 1, 2010. Some nursing homes have been holding claims for therapy services provided on or after January 1 for residents who exceeded the cap, but qualified for an exception under previous law. These facilities may now submit those claims to Medicare.
Nursing homes who have submitted these claims before now and had them denied should ask their Medicare contractor to adjust the claims to add the KX modifier and ensure the appropriate exception applies.
Although the extension of the therapy cap exception process is good for providers, it is only temporary. If the process is not extended beyond March, many facilities will see declines in revenue.
"If a resident goes over the cap, the facility can bill privately. But if the resident has Medicaid, this may hurt the SNF for reimbursement purposes," Connor says.
In a statement released Wednesday, Larry Minnix, president and CEO of the American Association of Homes and Services for the Aging, commended Congress and President Obama for extending the therapy cap exceptions process and also called attention to the need for a permanent solution.
"We thank Congress and President Obama for extending the Medicare Part B therapy cap exceptions process for an additional 30 days. The exceptions process works well to ensure that Medicare beneficiaries get the therapy they need to resume their regular activities and maintain as much independence as possible," Minnix said. "We urge Congress and the administration to come to a more permanent solution to allow seniors to get essential therapy in the venue they choose, by extending the exceptions process permanently or by repealing therapy caps before the current extension ends."
The Center for Medicare & Medicaid Services (CMS) recently posted the remaining sections of the new Resident Assessment Instrument (RAI) User's Manual on their Web site, allowing long-term care providers to view the manual for the new Minimum Data Set, Version 3.0 (MDS 3.0), in its entirety.
The recently released sections include Chapter 2 – Assessments for the RAI, Chapter 4 — Care Area Assessment (CAA) Process and Care Planning, and Appendix C — CAA Resources. In addition to the final RAI User's Manual sections, CMS also posted a new version of the MDS 3.0 item subsets and a file that lists the changes that have been made to each of the individual item subsets from the previously-posted versions. CMS also removed the MDS 3.0 Item Matrix from the list of available downloads, but the content of this matrix can be found in Appendix F of the RAI User's Manual.
Chapters 1, 3, and 5, and Appendices A through H of the new RAI User's Manual were released November 24 and Chapter 6 was released January 6.
"Now that the complete manual is available, it is the time for providers to read it and continue to highlight the changes and make notes to prepare themselves for the upcoming implementation date," says Randy Kozeal, owner and manager of LTC Midwest, LLC, in Wilber, NE.
Although reviewing the manual in preparation for the changes under the MDS 3.0 is imperative for a successful transition to the new assessment instrument in October, providers should be on the look out for potential manual revisions. During a January 21 SNF Open Door Forum, CMS official Tom Dudley mentioned there may be revisions to the manual in the upcoming months.
"Based on feedback they receive on the manual, they plan to issue an update prior to the March train-the-trainer session for the state RAI coordinators and surveyors," says Rena Shephard, MHA, RN, RAC-MT, C-NE, president of RRS Healthcare Consulting Services in San Diego.
Rural healthcare projects would lose $44 million in President Obama's proposed 2011 budget, but that number is deceiving because the reduction includes the end of two regional projects that are costing $45 million in the current fiscal year.
The programs are the Denali Project and the Delta Health Initiative. The Denali Project has received more than $300 million since 2000 for construction of health facilities in rural Alaska. The Delta Health Initiative, launched in 2006, brought seed money to projects providing chronic disease management, pharmacy, dental, school-based mental health services, and teenage pregnancy prevention to rural areas of Mississippi.
With those programs ending, their funding goes with them, leaving the total rural health line item in Obama's proposed budget at $142 million.
There are some positives for rural health. Rural health outreach is slated to receive an addition $1 million in the proposed budget ($57 million compared to $56 million in the current fiscal year).
"There are nearly 50 million people living in 2,052 rural counties throughout America who experience ongoing challenges in accessing healthcare," according to Obama's budget proposal. "The budget includes $142 million to improve access to quality healthcare in rural areas. Within this total, $62 million is included to work with Critical Access Hospitals, conduct research on rural health issues, and support community access to emergency devices."
It adds, "As part of the President's initiative to improve rural healthcare, HRSA [the Health Resources and Services Administration] will develop stronger links between telehealth activities and other investments in rural health."
Lori Heim, MD, president of the American Academy of Family Physicians, points to another section of the HRSA budget that increases spending by $27 million for the National Health Service Corps—from $142 million to $169 million.
"We calculated that this will pay for 445 new physicians, and most of them will provide care in medically underserved areas," including those in rural communities, Heim says.
She adds that still another section of the budget labeled "Primary Care" will receive an additional $290 million for health centers, many of which serve rural areas. The total sum for primary care goes from $2.08 billion to $2.498 billion.
"We're pleased with parts of this budget, because this is a pretty austere climate, an a lot of budget items are level," Heim says.
But the fact that primary care services in underserved areas will get a boost is encouraging. "We certainly represent doctors who provide most of the medical care delivered in rural areas. And this does show recognition by this administration that we need to build up the workforce of primary care so we can provide more healthcare and expand coverage for rural communities."
Healthcare programs for American Indians and Alaska Native communities also received a boost of an additional $354 million, totaling $5.4 billion.
This would "enable the Indian Health Service (IHS) to deliver quality care, ensuring that IHS services can be supplemented by care purchased outside the Indian health system where necessary, and funding health facility and medical equipment upgrades," according to the proposal.
There are other rural health segments that are being level-funded. Rural telehealth, which received a $4 million boost last year to $12 million, would remain the same, as would spending on rural hospital flexibility grants ($41 million), rural health policy development ($10 million), black lung disease clinics ($7 million), and research on diseases caused by radiation ($2 million).
In other portions of the budget, there is $5 million in grants to states to help federally qualified health centers and rural health clinics transition to a prospective payment system for the Children's Health Insurance Program.
Martin Kramer, a spokesman for the Health Resources and Services Administration, says outreach grantees can be small rural hospitals, nonprofit organizations or community health centers, and can receive grants to "try out their ideas to meet the goals."
Kramer adds that the money does not have to be focused solely on recruiting physicians, but can also be used to recruit other providers in rural areas, such as nurses, emergency medical technicians, oral health or mental health providers.
Additionally, the budget would increase spending for inspections in a way that is sure to affect rural clinics. Currently, survey and certification frequency for federal reimbursement is scheduled every 11.5 years, but the frequency would be cut in half, to every six years.
Other types of facilities would also have more frequent certification reviews and surveys: non-accredited hospitals would go from every five years to every three years. End-stage renal disease facilities, now reviewed every 4.6 years, would be surveyed every three years. And ambulatory surgical centers, along with hospices, outpatient physical therapy, outpatient rehabilitation, portable X-rays, and ambulatory surgical centers would go from surveys every 11.5 years to every six years.
Skilled nursing facilities in the Recovery Audit Contractor (RAC) program's Region D should pay extra attention to consolidated billing practices and reimbursement as HealthDataInsights (HDI), the RAC for that region, recently added SNF consolidated billing to its list of CMS approved audit issues.
HDI recently posted the following description of SNF consolidated billing on their Web site:
"Payment for the majority of Skilled Nursing Facility (SNF) services provided to beneficiaries in a Medicare covered Part A SNF stay are included in a bundled prospective payment made through the fiscal intermediary (FI)/A/B Medicare Administrative Contractor (MAC) to the SNF. These bundled services are to be billed by the SNF to the FI/A/B MAC in a consolidated bill.
"The consolidated billing requirement confers on the SNF the billing responsibility for the entire package of care that residents receive during a covered Part A SNF stay and physical, occupational, and speech therapy services received during a non-covered stay.
"Section 4432 (b) of the Balanced Budget Act (BBA) requires consolidated billing for SNFs. Under the consolidated billing requirement, the SNF must submit ALL Medicare claims for ALL the services that its residents receive under Part A, except for certain excluded services described in § 20.1 – 20.3, and for all physical, occupational and speech-language pathology services received by residents under Part B.
"Physician's professional services are excluded from this consolidated billing requirement; however, the technical and facility based components of physician services delivered to SNF inpatients are bundled into the Part A PPS payment and are not paid separately under Part B."
Region D includes Alaska, Arizona, California, Hawaii, Iowa, Idaho, Kansas, Missouri, Montana, North Dakota, Nebraska, Nevada, Oregon, South Dakota, Utah, Washington, Wyoming, Guam, American Samoa, and Northern Marianas. The SNF consolidated billing audit issue applies to all states in Region D.
"We don't have information about the specific consolidated billing issues the RACs will target SNFs for since only one contractor has just started to focus on this, but there are some things the RACs will most likely look into," says Andrew Wachler, managing partner at Wachler & Associates, PC, in Royal Oak, MI. "For example, situations when SNF residents don't meet the Medicare Part A eligibility requirements and when physical therapy, occupational therapy, or speech language pathology is not medically necessary will probably be main focuses of the RACs."
Although SNFs will be the primary target when tracking down overpayments related to consolidated billing, Wachler anticipates that the RACs will also look at vendors when auditing for Part B items and services.
"If a RAC does identify an overpayment, providers should aggressively appeal the decision," Wachler says. "We had a very good success rate for appeals in the demonstration project, but, unfortunately, many providers didn't appeal. There were only appeals in 22.5% of the cases in the demonstration project, so the RACs recouped a large amount of money without anyone challenging their decisions."
Although SNFs were not a main focus of the demonstration, Wachler believes the RACs will increase their efforts to identify SNF overpayments as the program progresses.
"The contractors are adding to their lists of audit issues and I think it is only a matter of time until we see SNFs getting hit hard by the RACs," Wachler says. "I don't think you can really avoid a RAC audit, but you can make yourself a hard target by putting procedures and processes in place to make sure you understand the requirements, are in compliance, and properly document the medical necessity of the services you provide."
