Avoid payment denial

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Avoid payment denial
Avoid payment denial

By Leah Klusch, Executive Director The Alliance Training Center 

Medicare payment to skilled nursing facilities is a vital part of many facilities' fiscal stability. That's one reason for the build-up of rehab departments in facilities.

But now post-payment reviews are putting that resource at risk.

You cannot afford demands for repayment from federal regulators because of technical or database errors. The Recovery Audit Contractor (RAC) program adds an additional, aggressive level of scrutiny to paid Part A SNF claims that must be considered by operational managers.

For better or worse, the demonstration project for the RAC program resulted in payment denials for many facilities after post-payment review.

To deal with this, you need a well-defined corporate compliance program to monitor day-to-day compliance with Part A Medicare coverage criteria, billing processes and internal documentation requirements for the program. Most audits are conducted on MDS and Universal Billing databases without facility notification until demands for repayment are issued. This could put you at risk eight to 20 months post payment.

Where trouble occurs

In brief, many management teams have not looked at compliance in this specific area. They assume that if claims have been paid, the claims are accurate and appropriate. Not necessarily so.

Here are some questions to ask for an internal compliance review that teams should initiate to prepare for the RAC audit activity, based on the current audit activity and the demonstration project that was completed and reported on in 2008.  The final RAC program activity started in March of 2009 and will be involving claims from most states early in 2010.

1. What does your team know about the Medicare Part A benefits available in skilled nursing facilities from actual CMS guidelines or definitions?  

You must use the definitions and benefit statements from the Medicare Benefit Policy Manual, Chapter 8, section 30. What is covered and how does my facility document that we have considered and met the definitions and guidelines for coverage? One of the best examples of this lack of specific definition is the statement in the MBPM section 30 that states, “Care in a Skilled Nursing Facility is covered if the following four criteria are met …” and then four very specific criteria are explained.

Many admissions and clinical professionals making the in-facility coverage decisions at the time of admission know the general concepts but do not document the specifics. The same section also states, “If one of the four criteria are not met the stay in the facility is not covered.” (Emphasis added.)

So a year after you have admitted the beneficiary and successfully delivered proper skilled services, you could be requested to substantiate your compliance with the four criteria for admission. Where are the physician orders for the care and services documented and dated? What do your documents say and do they show compliance?   How do you manage the admitting diagnosis documentation and changes in that diagnosis as the stay progresses? Does the diagnosis connect to treatment?

Meeting of minds

2. How does your rehab and nursing team determine continued coverage under Medicare Part A during the stay?

This is managed by specific decisions of the team with the physician and also as the result of the Utilization Review or Medicare meetings. What is the format for your meetings discussing coverage and just how are the decisions at the meetings documented for future reference if the coverage of the case is ever questioned on a pre-payment or post payment review?

Who is in attendance at the meetings, and are the decisions for coverage documented with clinical substantiation? On rehab cases, how are the ADL score and functional improvement of the resident documented to show improvement or stability of function? The RAC audits look at the level of rehab and the corresponding ADL score over time. You should have minutes with decisions related to coverage as part of your corporate compliance records.

3. Do your documents show treatment records that substantiate skilled nursing or skilled rehabilitation on a daily basis? 

This is a requirement for coverage of Part A services.

Can you, as an operational manager, go to a closed Part A Medicare chart and see the documentation of skilled services on a daily basis?

What do the MDS documents say throughout the stay to substantiate the services and the resident's condition and does that data exactly match the Universal Bill that delivered us the payment?  Billing, assessment and compliance records need to match.

By taking a look at these three important compliance and operational processes in your facility, you can begin to evaluate the quality of your documents and documentation. Your goal should be that the documents (billing, clinical record and compliance) match the coverage guidelines and the billing process direction.

Significant communication needs to be facilitated between the MDS manager, the billing managers and the rules that formulate coverage and compliance.

The RAC auditors will be looking for situations where the data does not match, the processes have not been competed accurately or on time, or where services and data are not reasonable.