RAC UpdateRAC UpdateGAHA: 2014 Health Care Law Update

May 16, 2014Tracy M. Field, M.S., J.D.

Womble Carlyle Sandridge & Rice, LLP 271 17th Street, NW – Suite 2400, Atlanta, GA 30363(404) 962-7539

MEDICARE AUDITSNow What?

Perspective:•By challenging denials, CMS changed the rules!•Compliance challenge: How assess accuracy?

• Business reasons for rebilling Part B• 2 year backlog – and growing!

ALJ BACKLOGOMHA February 2014 Forum

Office of Medicare Hearings and Appeals (OMHA) Forum: February 12, 2014•Backlog of 500,000 cases – and counting!•Moratorium on docketing new appeals until workload addressed per ALJoHearings being scheduled

ALJ BACKLOGOMHA February 2014 Forum

• Backlogo Budget increase: 18+% (after sequester)o Statistical sampling?‒ OMHA statistician‒ Appropriate for fact-specific caseso Mediation/Alternative Dispute Resolutiono New regulations

ALJ BACKLOGOMHA February 2014 Forum

• No longer need to submit medical records?• Group cases – but individually file!• Electronic filing?

o Send files via tracking methods, and don’t expect an acknowledgment!

o Miami piloto 2 year development from award

ALJ BACKLOGOMHA February 2014 Forum

• Backlogo Increase in Escalation to DAB-MAC‒ NO Hearing at DAB-MAC‒ Access to federal court sooner – but…o OMHA stated testimony makes

difference - yeto OMHA suggested may not want to

request hearing?

ALJ BACKLOGOMHA February 2014 Forum

• Legal Considerationso Medicare Modernization Act (MMA)

and BIPA deadlines not being meto For medical necessity cases, what

standard of review applies? o Confusion on effective dates for local

coverage determinations (LCDs)o Jimmo Case: Important for rehab, other

uses?

ALJ BACKLOGOMHA February 2014 Forum

• Compliance Considerationso Part A/B Claims: 97% of appealso Redetermination reversal rate to fully

favorable: ‒ 30% per OMHA

ALJ BACKLOGOMHA February 2014 Forum

For OMHA Outcomes of Cases Decided at ALJ•37% Fully Favorable – 4% Partially Favorable•30% Unfavorable•1% Remand •27% DismissedImpact on Compliance activities….

RAC REPORT(March) 2014

For FYE 2012: oIncreasing RAC Activity

» Medicaid RACs» Data warehouse » Validation audits, education» “Maximize transparency”» Hearing Participation

RAC REPORT(March) 2014

For FYE 2012: oCollected $2.3 Billion in overpayments…oNew initiatives to prevent provider appeals?

» The 2 Midnight Rule» Subregulatory Guidance?

17

RAC Denial

Redetermination (MAC)

Qualified Independent Contractor (QIC)

Administrative Law Judge (ALJ)

Medicare Appeals Council (MAC)/Departmental Appeals Board (DAB)

Federal Court

MAC REVIEWS

INITIAL REVIEWSProbe Audits

MAC Audits: January 2014• MAC prepayment reviews: “probe and

educate”

Recovery Audits: • Delayed until November 2014 – but the

probe audits continue….

INITIAL REVIEWSProbe Audits

Presumptions that Hospital Stays Less than 2 Midnights are Not Medically Necessary

• Presumption does not mean wrong!!• Legal challenges to denials• Strategy to avoid audits

o Some opted for no one-day stayso Rebill under Part B?

MEDICARE APPEALSOther Considerations

IPPS Proposed Rule: Payment for Short Stay Admissions:• Payment under OPPS or IPPS?

AHA Litigation: • Challenges the 2 Midnight Rule; Part A/B Rebilling time limitations and physician certification of orders as payment condition

REFERENCES

www.hhs.gov/omha•Per OMHA: Updates after 15th of each month on adjudication timelines, processes

•OMHA Adjudication Manual Pending

QUESTIONS?

Tracy M. Field, M.S., J.D.

tfield@wscr.com(404) 962-7539

Womble Carlyle Sandridge & Rice, LLP271 17th Street, N.W.

Suite 2400Atlanta, Georgia 30363