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MedPAC shows enthusiasm for equalizing SNF, inpatient rehab facility payments
MedPAC shows enthusiasm for equalizing SNF, inpatient rehab facility payments

Instead of spending more time doing hands-on patient care, therapists who work with Medicare beneficiaries have been strapped with increased administrative tasks, sometimes leading to delayed services, or worse. It started with a three-month test phase of a federally mandated manual review process requiring physical, occupational and speech therapists to submit pre-approval requests to Medicare Administrative Contractors (MACs) for all services beyond the $1,880 Medicare Part B outpatient therapy caps. The rule applied to therapy provided by skilled nursing facilities, private practices, rehabilitation agencies, outpatient facilities and home health agencies.

Healthcare administrators and policy analysts said the pre-approval process, as they expected, placed too much burden on employees of long-term care facilities, where medically complex patients often require multiple types of therapy over extended periods of time.

“Manual medical review has increased workload for typically the neediest residents in long-term care — those with chronic and debilitating illnesses who may have treatment more than one time a year in order to maintain independence and activities of daily living,” says Holli Benthusen, regional director of business development for Select Medical Rehabilitation Services.

Benthusen points particularly to residents who suffer falls or have problems swallowing. Patients recovering from strokes also would be highly likely to exceed the caps, therefore becoming snagged in the review process.

Providers reported slow or lost responses from fiscal intermediaries, high denial rates and an overall failure to communicate. Among their other concerns: confusion among patients and responsible parties about the review process; potential lapses in service and financial responsibility; and patients who opted to delay medically necessary therapy until their caps “reset” in January rather than risk being billed.

“It's really a calamity,” says Cynthia Morton, executive vice president of the National Association for the Support of Long Term Care. “That's a strong word, and I mean it. There are problems happening all over the place.”

It doesn't get better

Worse news for providers: The three-month test phase has been extended. In January, Congress lengthened the review process through 2013 — a sign that the process is here to stay, Medicare experts believe. 

The Centers for Medicare & Medicaid Services has struggled in recent years to create a payment system for therapy services, while the need and cost for such care continue to grow.

“I can't imagine that they would stop this process,” says Leigh Ann Frick, vice president of clinical services for Heritage Healthcare. “It's doing what they want it to do, which is creating a bottleneck.”

Congress established the manual medical review criteria as part of the Middle Class Tax Relief and Job Creation Act of 2012, which was signed into law a year ago.

Providers were divided into three phases and assigned a reporting start date. By the time the review requirements kicked in during the fall, many Medicare contractors still were not prepared to deal with the influx of paperwork and fast turnaround times.

Shelly Mesure, senior vice president for Orchestral Rehabilitation Services, offers training on government requirements to facilities of all sizes. Providers she worked with told of “craziness” surrounding the new process.

“Almost every facility that was in Phase I said they had major problems,” Mesure says. “The FIs weren't well-equipped to handle all of the new workload.”

Because of HIPAA regulations, providers were not allowed to transmit their requests electronically. That meant that all requests had to be made through hand-delivered mail or by fax, depending on the contractor. In some cases, 20 pages were needed to support a request.

“We saw, on average, a three- to five-percent drop in productivity,” says Frick. “We heard an endless stream of phone calls from employees who were frustrated by standing at fax machines.”

Even when transmittals were confirmed by time stamp or certified mail, many facilities said MACs denied that requests were received.

“I've heard it over and over again,” says Morton. “And we don't really have a window into the MACs. There's no ombudsman. For most, there's not even a phone number you can call.”

Regulations give MACs 10 days to make a decision. Otherwise, guidelines say, “the request for exception will be deemed to be approved.” The loophole, however, is that some decisions are mailed on the 10th day and providers must allow for delivery time.

At Frick's facilities, that often translated to a wait of 16 business days for pre-approval. In some cases, providers reported responses were sent to business addresses on file with Medicare instead of to contacts provided on pre-approval forms.

“The tracking and communication needed to know where each patient is in the process can be extensive,” says Benthusen.

Margaret Kopp, vice president of clinical services and quality management at Select Medical, says 50% of requests for her facilities' patients are pending at any time.

“This does not give the facility or the provider much say in the matter,” says Kopp, “yet a patient can be waiting more than three weeks sometimes for a reply.”

Morton says some facilities are starting needed services regardless of the review.

“The patients are there, waiting,” she says. “They're not well. They are pretty debilitated. Maybe it's post-surgery. Maybe it's post-stroke. But they will become worse as they sit there and wait for therapy, when therapy is supposed to help them talk, help them walk, help them swallow their food.”

For some patients, Mesure says, a two-week delay could translate to a three-month setback.

Perilous pauses

Facilities that wait to deliver care know the risk is great. CMS told therapy providers they should not wait to start services until hearing from the MAC, Mesure says. And state surveyors who see patients in need of care will not accept the pre-approval process as a legitimate reason for delay.

On the other hand, some providers' requests are being denied at an alarming rate, depending on the MAC. Kopp said approximately 40% of the responses received by her facilities have been denials.

“We have one MAC that has denied almost every single one of them,” reports Frick, whose company has 180 contacts across 15 states.

In another scenario, three letters were issued for the same request: one saying the service was fully approved, one saying it was partially approved, and one saying it was denied. Frick said the facility moved forward with the care as if it were approved, using a tracking number that was provided by the MAC. At press time, the therapy had not yet been billed so it was unclear how Medicare would treat that case.

Other providers have submitted requests for speech therapy and been approved to give the patient physical therapy instead. Some have had a few days of service approved for patients with extensive needs, rather than the full 20 provided for in the regulations. 

MACs, says Morton, generally have a therapist on staff. But a physical therapist isn't necessarily qualified to determine whether a patient needs speech or language therapy. She says the overlap may lead to some of the “bizarre” responses.

Now that Congress has extended the review period — and increased each cap to $1,900 — providers will have to work from within the system to improve it.

But they are concerned that one major piece of fallout could be compounded by year-round pre-approval requirements: patients who are at or near the cap limit who decide to delay therapy.

“They're making financial decisions,” says Frick. “They're saying ‘Let me wait until January when my cap resets,' when they could truly benefit from the care now.”

Mesure says that was most common in outpatient therapy settings, where some patients notified of a possible denial canceled appointments. She says it's less likely to happen at nursing homes, where immediate care is critical.

But skilled nursing patients may not have as many treatment options as they once did. Morton says she is aware of some nursing homes that, in 2012, declined to accept patients who were already at the therapy cap limit. Benthusen is worried that patients who were denied services in 2012 also will be “more likely scrutinized if picked up for treatment in 2013.”

In cases where coverage is denied, Mesure says strong documentation can lead to successful appeals. The burden of explaining the process to patients, however, will fall on therapists already taxed by the review process.

Also on Jan. 1, therapists were required to begin reporting additional codes to help CMS track functional limitations at the outset, during and at the conclusion of therapy. 

Barbara Manard, vice president for long-term care health strategies at LeadingAge, says the data will be used “primarily to design a new payment system for therapy services,” which was the same explanation attached to the manual review regulations.

Frick, who has expressed her concerns in meetings with CMS officials, doesn't think either reporting requirement will lead to viable changes any time soon.

“Their intentions are good, but the bureaucracy of it is working against them,” she says. “There is a way to eliminate the silos of the continuum of care. You can establish some criteria looking at the key outcomes for the geriatric population.”

Morton notes that Congress is getting “impatient” for a fix. In the meantime, she suggests providers keep stronger documentation and that each MAC designate a trouble shooter to help make sure the needs of patients are addressed quickly.

“There has just got to be more attention paid to this,” she says. 

According to CMS, officials are monitoring workload, processing time and accuracy, as well as providing technical assistance to the contractors.

CMS says its staff has participated in Open Door Forum calls with providers to exchange information about the new policies and procedures. Providers also can email concerns or suggestions to therapycapreview@cms.hhs.gov.

New guidance for 2013 will be shared through MLN Matters articles and other means of outreach, officials say. 

CMS also says it is considering electronic submission and its possible implications. Information gathered is supposed to determine, in part, where more provider education might be needed, reasons for improper payments and potentially fraudulent practices. 

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