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Reimbursement Primer for Compliance, Ethics and Legal Officers: “Everything You Have Always Wanted to Know About Reimbursement but Were Afraid to Ask.”. Post Acute Care: Nursing Facilities, Skilled Nursing Facilities, Assisted Living April 17, 2007. - PowerPoint PPT Presentation
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Reimbursement Primer for Compliance, Ethics and Legal Reimbursement Primer for Compliance, Ethics and Legal Officers: “Everything You Have Always Wanted to Know Officers: “Everything You Have Always Wanted to Know
AboutAbout Reimbursement but Were Afraid to Ask.” Reimbursement but Were Afraid to Ask.”
Post Acute Care: Nursing Facilities,Skilled Nursing Facilities, Assisted Living
April 17, 2007April 17, 2007
► Janine Boudreau, Janine Boudreau Healthcare Consulting, Inc.► Lynda Hilliard, Senior Manager, Life Sciences & Healthcare
Regulatory Services,Deloitte & Touche LLP► W. Scott Plumb, Senior Vice President, Massachusetts Extended
Care Federation
► Moderated by Lawrence W. Vernaglia, Foley & Lardner, LLPModerated by Lawrence W. Vernaglia, Foley & Lardner, LLP
Session ObjectivesSession Objectives
► Gain insight into the market for the primary Gain insight into the market for the primary care sectors for Post Acute Care care sectors for Post Acute Care
► Obtain a general understanding of the Obtain a general understanding of the primary reimbursement streams for skilled primary reimbursement streams for skilled nursing facilities (“SNF”), assisted living nursing facilities (“SNF”), assisted living faciities (“ALF”), and nursing homes (“NH”).faciities (“ALF”), and nursing homes (“NH”).
► Gain insight into government Gain insight into government reimbursement compliance issues in this reimbursement compliance issues in this marketplacemarketplace
Post Acute CarePost Acute Care
►Discussion will be segmented into 3 Discussion will be segmented into 3 areas:areas: Industry Overview – Scott PlumbIndustry Overview – Scott Plumb
High Level Revenue Cycle Overview – JanineHigh Level Revenue Cycle Overview – Janine
Reimbursement Compliance Issues – Lynda Reimbursement Compliance Issues – Lynda
HilliardHilliard
► Questions and Answers from ParticipantsQuestions and Answers from Participants
Industry OverviewIndustry Overview
Provider Payer Mix ComparisonProvider Payer Mix ComparisonNursing homes are uniquely dependent upon Medicaid Nursing homes are uniquely dependent upon Medicaid
to provide quality health careto provide quality health care
Medicare49%
Medicaid34%
Private Pay/Other17%
Other7%
Medicaid12%
Private Pay40%
Medicare41%
Private Pay15.0%
Medicare15.9%
Other Payers (Insurance, Hospice)
1%
Medicaid 68.1%
Nursing Home Payer Mix Home Health Payer Mix
Acute Hospitals Payer Mix
$0.71
$0.13
$0.10$0.06
Based on Division of Health Care Finance and Policy nursing facility cost reports
The Nursing Facility “Dollar”:The Nursing Facility “Dollar”:Breakdown of Nursing Home SpendingBreakdown of Nursing Home Spending
Salaries and benefits represent 71 cents of every dollar Salaries and benefits represent 71 cents of every dollar spent by nursing facilitiesspent by nursing facilities
All Staff Wages & Benefits
General Expenses/Operating(Supplies, Food, Utilities & Liability Insurance)
Physical Plant(Mortgage and Property Taxes)
Administration (Administrator, Accounting, Clerical)
50,000 Nursing Facility Employees50,000 Nursing Facility EmployeesThe nursing facility provider community is a major The nursing facility provider community is a major
economic engineeconomic engineand is the largest employer in some communitiesand is the largest employer in some communities
Dietary10%
Laundry3%
Housekeeping6%
Social/ Medical7%
Direct Care Nursing Staff64%
Administrative8%
Maintenance
2%
Source: DHCFP Nursing Facility Annual Cost Reports
32,000
Social/Medical
$12.64$13.23
$14.28$14.87
$15.44$15.90
$16.40$16.88
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1999 2000 2001 2002 2003 2004 2005 2006
Nursing Facility Direct Care Nursing Staff Nursing Facility Direct Care Nursing Staff Median Wage Increases:1999–2006 Median Wage Increases:1999–2006
Nursing facilities are good employersNursing facilities are good employers Average annual increase of 4.2% Average annual increase of 4.2%
$12.64$13.23
$14.28$14.87
$15.44$15.90
$16.40$16.88
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1999 2000 2001 2002 2003 2004 2005 2006
Sources: MECF Annual Wage Surveys 1999-2006
4.6%
7.9%4.1%
3.8%3.0%
3.1%3.0%
3,700 Nursing Facility Direct Care 3,700 Nursing Facility Direct Care Staff Vacancies Staff Vacancies
Despite Investment in Staff Wages & Benefits, Significant Despite Investment in Staff Wages & Benefits, Significant
Vacancies ExistVacancies Exist
Certified Nurse Aide1,900
Licensed Practical Nurse800
Registered Nurse1,100
Sources: DHCFP Annual Nursing Facility Cost Reports and MECF Annual Wage Surveys
Certified Nurse Aide
1,800
Average Daily Minutes of Nursing Average Daily Minutes of Nursing Care Reimbursed By MedicaidCare Reimbursed By Medicaid*1*1
197.0
185.9
196.3194.2
190.6
175
180
185
190
195
200
FY95-97 FY98-00 FY01-03 FY04-06 FY07
Movi
ng A
vera
ge M
MQ
Sco
re
Unaudited Management Minutes
*1The average daily minutes of nursing care reimbursed by Medicaid (197 minutes in 2007) falls short of the average daily minutes of care provided by nursing homes (204 minutes in 2007).
Source: MassHealth and Division of Health Care Finance and Policy; Prepared by: Massachusetts Extended Care Federation
Medicaid Nursing Facility Medicaid Nursing Facility Resident AcuityResident Acuity – 2006 – 2006
Nearly all nursing home residents require extensive Nearly all nursing home residents require extensive nursing carenursing care
26.0%
15.0%
3.0%
13.0%
20.0%
24.0%
0%
5%
10%
15%
20%
25%
30%
Category 1 Category 2 Category 3 Category 4 Category 5 Category 6
% of Total Medicaid Residents in Case Mix Category
MMQ Category H J,K L,M N,P R,S T
Minutes (Range) 30 30.1 – 110 110.1 – 170 170.1 – 225 225.1 – 270 270.1+
Source: MassHealth Unaudited Management Nursing Minutes Score
Minutes (Median) 30 81 142 199 244 288
Nursing Facility MEDICAIDNursing Facility MEDICAIDUNCOMPENSATED CARE Per Day, 1999-2006UNCOMPENSATED CARE Per Day, 1999-2006
$500,000 annual Medicaid loss per Medicaid participating nursing $500,000 annual Medicaid loss per Medicaid participating nursing
facilityfacility
$15$16
$18
$21$20
$16
$18
$21
$0
$5
$10
$15
$20
$25
1999 2000 2001 2002 *2003 2004 2005 2006(Proj)
Sources: 1999-2004 BDO Seidman Reports; MECF Estimates 2005-2006
*User Fee Program Implemented (2003); User Fee Program Maintained In Subsequent Years
Consumer Satisfaction in Consumer Satisfaction in Massachusetts Nursing HomesMassachusetts Nursing Homes
Independent state survey shows nursing facility consumers are Independent state survey shows nursing facility consumers are highly satisfiedhighly satisfied
87%
13%
0% 0% 0%
0
10
20
30
40
50
60
70
80
90
100
Very Satisfied Satisfied Neutral Dissatisfied Very Dissatisfied
Source: Massachusetts DPH Nursing Home Satisfaction Survey Results, December 2005
% of nursing homes
Consumers who are:
Nursing Facility Spending As a Percentage Nursing Facility Spending As a Percentage of Total Medicaid Spending: FY1999-FY2006of Total Medicaid Spending: FY1999-FY2006
22.5%
24.3%
26.4%25.6%
25.7%
28.2%
30.1%
31.5%
22
23
24
25
26
27
28
29
30
31
32
1999 2000 2001 2002 2003 2004 2005 2006
% of Total Medicaid Spending
Sources: SFY 1999-2004 Actual (MassHealth Budget Office); SFY 2005-FY2006 Massachusetts Taxpayers Foundation (April 2005 Report, p.14) and MECF Nursing Home Data
Continuum of Long Term CareContinuum of Long Term Care
► Short Term CareShort Term Care► Hip FracturesHip Fractures► Knee Knee
ReplacementsReplacements► StrokeStroke► Cardiac DiseaseCardiac Disease
► Long Term CareLong Term Care► Alzheimer’s DiseaseAlzheimer’s Disease► Advanced DementiaAdvanced Dementia► Multiple IllnessesMultiple Illnesses► Congestive Heart Congestive Heart
FailureFailure► Advanced DiabetesAdvanced Diabetes► Neurological (MS, Neurological (MS,
Severe Brain Injury)Severe Brain Injury)► HospiceHospice
At Home:Routine Care
At Home:Informal Support
At Home:Formal Support
AssistedLiving
Facility-Based Care
High Level Revenue CycleHigh Level Revenue Cycle
Pre-Admission ChecklistPre-Admission Checklist► Review and Log ReferralReview and Log Referral► Verify BenefitsVerify Benefits► Co-InsuranceCo-Insurance► Medicaid – Eligibility Date/TypeMedicaid – Eligibility Date/Type► Managed Care – PolicyManaged Care – Policy► Hospice – ProviderHospice – Provider► Other – Review with AdministratorOther – Review with Administrator► Price Out P.O. MedicationsPrice Out P.O. Medications► Call for IV Medication PricingCall for IV Medication Pricing► Review Clinical Information with DON or designeeReview Clinical Information with DON or designee► Review Whole Referral with Administrator/COOReview Whole Referral with Administrator/COO► Offer Bed Immediately for ApprovalsOffer Bed Immediately for Approvals► Contact Chief Clinical Officer for DenialsContact Chief Clinical Officer for Denials► Admissions Stand Up MeetingAdmissions Stand Up Meeting► Assign Guardian AngelAssign Guardian Angel► Sign Resident InSign Resident In
Payor MixPayor Mix
►MedicareMedicare►HMO/Managed CareHMO/Managed Care►PrivatePrivate►MedicaidMedicaid
Special PopulationsSpecial Populations
►PalliativePalliative►HospiceHospice►HIVHIV
Billing CycleBilling Cycle
►Pre-billing for:Pre-billing for: PrivatePrivate Patient Paid Amount (PPA)Patient Paid Amount (PPA) HMO/Managed CareHMO/Managed Care
►Prior AuthorizationPrior Authorization
Medicare/MedicaidMedicare/Medicaid►Verifying level prior to actual billingVerifying level prior to actual billing
Rebilling and ReconciliationRebilling and Reconciliation
►Credit BalancesCredit Balances►AdjustmentsAdjustments►Denied or Suspended ClaimsDenied or Suspended Claims
Reimbursement Compliance Reimbursement Compliance IssuesIssues
SNFs - Focus of 2007 OIG Work PlanBilling/Reimbursement
Skilled Nursing Facilities’ Involvement in
Consecutive Inpatient Stays
Skilled Nursing Facility Payments for Day of
Discharge
Skilled Nursing Facility Consolidated Billing
Submission of Skilled Nursing Facility No-Pay Bills
HMB (Hospice) Payments to Nursing Home
Covered Services Skilled Facility Rehabilitation and Infusion
Therapy Imaging and Laboratory Services in
Nursing Homes Implementation of Medicare Part D in
Nursing Facilities Inappropriate Psychotherapy Services in
Nursing Facilities
SNFs - Focus of 2007 OIG Work Plan
SNFs - Focus of 2007 OIG Work Plan
►Quality of Care and Licensing Concerns Nursing Home Residents’ Minimum Data
Set Assessments and Care Planning
Enforcement Actions Against Noncompliant Nursing Homes
Assisted Living Facilities
► Primarily Private PayPrimarily Private Pay► Medicaid Nursing Home WaiverMedicaid Nursing Home Waiver
Future State Future State Need to set up systems for monitoring coverage Need to set up systems for monitoring coverage
requirements and on-going eligibilityrequirements and on-going eligibility
► Eligible for certain Part A, Part B and HMB Eligible for certain Part A, Part B and HMB benefits in their homebenefits in their home Home Health services – Part A/BHome Health services – Part A/B Hospice Medicare Benefit – ALF = HomeHospice Medicare Benefit – ALF = Home
Nursing Homes
►Primarily Medicaid and Private PayPrimarily Medicaid and Private Pay►Medicare Part B CoverageMedicare Part B Coverage
For those NH patients who have exceeded For those NH patients who have exceeded their 100 day SNF benefit, they can receive their 100 day SNF benefit, they can receive Part B services, e.g, Rehab Services:Part B services, e.g, Rehab Services:
►Based on Medicare eligibility (enrolled in Part B)Based on Medicare eligibility (enrolled in Part B)►Documentation supports medical necessityDocumentation supports medical necessity►Physician orders are present and meet Physician orders are present and meet
reimbursement requirementsreimbursement requirements
Question and Answer Question and Answer
SessionSession
► Janine Boudreau, Janine Boudreau Healthcare Consulting, Inc.
► Lynda Hilliard, Senior Manager, Life Sciences & Healthcare Regulatory Services,Deloitte & Touche LLP
► W. Scott Plumb, Senior Vice President, Massachusetts Extended Care Federation
► Moderated by Lawrence W. Vernaglia, Foley & Lardner, Moderated by Lawrence W. Vernaglia, Foley & Lardner, LLPLLP