Secure Transfer System »     Client Portal Access »

Posts Tagged ‘OIG’

A Monday Look At Medicaid

Posted by J. Paul Spencer, CPC, CPC-H in Health Care Reform

I currently live in Wisconsin, and before that I had spent most of my time on the East Coast. I needed only look at the date on the calendar yesterday, and I knew the drill.

Yesterday (obviously) was St. Patrick’s Day. In Ireland, this is considered a serious day for the mostly Catholic country. In America, thanks to the descendants of the rabble from Europe having come to our shores, it’s an excuse to drink (a lot).

It is with great sadness, and to the significant financial detriment of the Wisconsin Tavern League, that I must announce that I was at home this St. Patrick’s Day, as my wife is out of town and I am in charge of my 6-year-old for the time being. As a public service, I would like to offer the reader a flimsy excuse to continue overindulging.

I have been spending a lot of my free time considering the expansion of Medicaid, set to arrive on January 1st, 2014 as part of the ongoing implementation of the Patient Protection and Affordable Care Act. Of late, I have written about the counter-intuitive approach of rolling out the Medicaid RAC program at full speed as millions are about to be added to states’ Medicaid rosters. One infrequently discussed portion of the Medicaid universe that I would like to turn my attention toward is Medicaid State Fraud Control Units (SFCUs).

Back on March 4th, the OIG released the results for SFCUs nationwide from Fiscal Year 2012. The final number is impressive on its face, showing over $2.9 billion in recoveries. Most of the states with bigger recoveries also ended up being our most populous states, which didn’t come as a surprise, but I decided on my own to conduct another exercise for purposes of self-enjoyment.

If we overlay the individual state collections by SFCUs over a map of states that have thus far decided against Medicaid expansion under PPACA (by the latest count there are 14 states in the “definitely not” column), we find that over $1.4 billion of the collections (or 48% of the total) comes exclusively from those same 14 states.

To me this points to another weakness in the Medicaid expansion. Thanks to the Supreme Court decision that gave the green light to PPACA, expanding Medicaid is now optional for all states. At first, those states more vocally opposed to the law quickly stated that they would not expand Medicaid programs in their states. Slowly, some of those original states, such as New Jersey and Florida (thought the Sunshine State has yet to finalize participation) have changed their minds, mainly due to hospitals – which have no interest seeing a spike in uncompensated care – lobbying in these states.

Medicaid Integrity programs are several years behind similar efforts in the Medicare system, mainly because in attempting to control the costs of Medicaid, you are forced into dealing with 50 different audit philosophies. Standardization does not exist, so it becomes any one’s guess as to what will be audited and when.

Obviously, the states involved in turning down a Medicaid expansion are doing it for political purposes, but is it a significant leap to say that the Medicaid Fraud in these same states is so pronounced that expanding the program would overwhelm their ability to control fraud? I leave that up to the reader, but it hands these states some ammunition beyond a simple disdain for all things Barack Obama.

My wife comes home today. See you at the bar!

Tags: , , , , , , , , , , , , , ,
March 18th, 2013 | No Comments »

The RAConteur: The Latest RAC Report to Congress

Posted by J. Paul Spencer, CPC, CPC-H in The RAConteur™

If there is one thing I can’t stand in the world of journalism, it is the alarming trend toward a lack of detail. Journalism is not about stenography. In a country with a “free press”, we must rely on people to not simply accept what they are being told. Journalists have a mandate to discover and report. They should look at the world with the eyes of Magellan, continuing to explore, challenge and report.

Recently, CMS released its Fiscal Year 2011 Report to Congress on Recovery Auditor Activity. Most of the press releases I have seen talk about the numbers, as if the only pages of the 41-page report that were reviewed were the two that dealt with collections and appeal numbers. None of these are remotely believable, let alone finalized, so I am going to ignore them. I feel it is important to look and read the entire report for findings that point to the continuing failure of the program.

The first thing that jumped out at me was on page 7. Under the heading of “How Recovery Auditors are Paid”. Like virtually everyone else who has wide exposure to the program, I was aware of the base contingency fee of 9 to 12.5 percent for the permanent contractors, but what I was unaware of was that this applies to all claim types except those for durable medical equipment (DME). The contingency fees for DME claims range from 14 to 17.5 percent.

This fact requires all of us to stop and think for a moment. One of the biggest areas of fraud in the Medicare program, which has been reiterated over several years and hundreds of OIG police blotters, is DME. Similarly, service specific probes undertaken by the MACs of DME claims have consistently reported inordinately high DME error rates. Seeing this, CMS has incentivized the RACs to go after improperly paid DME claims retrospectively with a 5% premium on the contingency fees.

If the current approved issues listings of the four RAC contractors are to be believed, this incentivization is being met with indifference. The approved issues lists are still made up of an overwhelming majority of inpatient hospital issues. HDI, the Region D contractor, currently ranks highest with 29 DME issues, while Connolly in Region C  brings up the rear with a mere 11. This is in contrast with CMS’ statement on page 18 that says “The CMS also continues to encourage Recovery Auditors to review all claim types”. Apparently, the RACs didn’t get the message about follow-through.

Perhaps the biggest outrage can be found on page 36 of the report. This is the page that shows the cumulative accuracy scores for the four recovery auditors. If we remember, the FY2010 Congressional Report had accuracy scores of 97.6 to 99.4 percent. What we knew at the time of the release of that report that these numbers strained all sense of credibility. Knowing that the number of outstanding appeals of RAC determinations number well into the hundreds of thousands now, the information on page 36 provides little solace. It is at least notable that the accuracy scores have gone down for every single Medicare RAC contractor, but the scores remain in an unbelievable range of 90.7 to 98.4 percent. CMS at least added information regarding how many claims were reviewed, with a post-script to the numbers stating “The sample size reviewed for each Recovery Auditor was between 1275 and 1300 claims”. Based on the fact that any one hospital that receives more than $100 million in payments annually from Medicare can receive as many as 4,867 additional documentation requests for complex review in a year, the claim sample size appears to be paltry in comparison.

The types of claims audited, as well as the entity that is conducting the reviews, was left out of the report. I asked CMS if the RAC Validation Contractor (RVC) was the entity performing the audits to determine the accuracy scores, as well as who is if the RVC is not. As of the release of this posting, I had yet to receive an answer to my question from CMS.

At the end of the day, the problem is not with the report, but the fact that only CMS submits a report to Congress. The more accurate reporting of RAC activity is coming from the AHA in their quarterly RACTrac report. Rather than CMS doing all of the talking on Capitol Hill, I suggest that the AHA get into the habit of sending their quarterly report to every member of Congress to counter CMS’ rosy picture of the program. There isn’t a single government entity that has ever existed that regularly admits to its own shortcomings. In a free society, it is left up to those of us who bother to discover, challenge and report. Despite being long separated by time and progress from Magellan, that process should never end.

Tags: , , , , , , , , , , , ,
February 14th, 2013 | 1 Comment »

The RAConteur: Truths (or Not) During Yuletide

Posted by J. Paul Spencer, CPC, CPC-H in The RAConteur™

Being a natural skeptic, I live by a central belief that based on the innate failings of humankind as a species, to attempt to live by a belief system written in any form by the hands of a human being is a waste of time. Additionally, anything new in written form should be regarded as highly suspect. This is not to say that I am a nihilist, as we (hopefully) all read Fathers and Sons by Ivan Turgenev, and we all know how adherence to that belief system turned out for Bazarov (I never said I didn’t read and digest fiction).

December is a special month when it comes to government healthcare reporting, and the past ten days brought forth a holiday season cornucopia full of chest-beatings, distortions and half-completed projects as it relates to Medicare “Integrity” efforts.

I’d like to rewind to the OIG’s Semiannual Report to Congress. The OIG reported $6.9 billion in “recoveries”, as well as $8.5 billion in estimated savings. Those are rather lofty numbers, so let’s take another look at what the OIG actually uncovered.

With regard to the recoveries, more than half of that total involved the illegal marketing and promotion of prescription drugs by two pharmaceutical companies. This is important to point out for two reasons. The pharmaceutical industry is making a killing on Medicare Part D thanks to the Billy Tauzin kickback that states that the government must purchase pharmaceuticals using average sale price. rather than the much lower average wholesale price. It’s once again simply wonderful to know that my tax dollars are being spent to subsidize aberrant corporate behavior. The second reason comes down to a simple conclusion. If more than half of your investigative recoveries come from those not involved in the direct delivery of health care, could it be that the constant “fraud” spotlight on doctors and hospitals needs to be redirected?

As for the “estimated savings”, if you look at all of the issues, from finding 1,700 physicians billing at a higher than expected E/M level to the 51% overpayment rate on vacuum erection systems for male impotence (you knew I would cover this in this blog) point back to what I have been telling anyone who will listen for years; the Medicare Administrative Carriers (MACs) are paying claims improperly and there are no consequences to their actions. Finding the savings are obvious with the slightest bit of deductive reasoning, but sometimes the solution doesn’t rely on redesign, but rather the threat of a hammer.

Since it’s RAC day here, let’s talk about the latest quarterly whitewash reports regarding RAC results. If we were to believe the latest quarterly RAC newsletter, the RACs collected $648 million in overpayments, with HDI-brought-to-you-by-HMS in Region D responsible for 37% of that total. That brings the total to $2.4 billion for Fiscal Year 2012 and nearly $3.5 billion over the 3-year life of the program, according to a second newsletter.

Once again, CMS has no reliable numbers regarding either the number of claims currently under appeal, appeals finalized, those appeals found in favor of the provider or the dollar amount returned to providers after successful appeal. These quarterly missives make for a great self-aggrandizing press release for CMS in the same fashion as a press conference featuring a single survivor of an Andean plane crash who was found four months after the crash and hearing this individual state that he only ate the women in order to survive.

Yesterday, the Justice Department sent out news stating that $4.9 billion was collected involving government fraud for FY 2012. When we scroll down to the Health Care Fraud section, we find that most of the money identified is from the two drug companies identified in the OIG Semiannual Report from a few paragraphs ago. Of note is the fact that 647 qui tam whistleblower suits were filed during the fiscal year, with $3.3 billion collected from such suits in the same period. As a compliance officer, the biggest responsibility I have is explaining why processes occur the way they do in order to avoid these types of filings. If your business model is shady, you deserve this kind of employee activity, but on-the-job teaching goes a long way.

Finally, we come to something from the OIG called the Compendium of Unimplemented Recommendations. This used to be known as the Red Book once upon a time, but post-traumatic stress disorder used to be called shell shock, so are you really surprised that something else in this world is now more complicated?

Here’s how unimpressive this particular report is as anything but as a doorstop. Of the 28 recommendations detailed under the headings “Avoid Wasteful Spending” and “Identify and Reduce Improper Payments”, 18 have a conclusion stating ”Savings probable but not estimated”. In short, the OIG did one very narrow review of a questionable payment issue, came up with findings pointing to significant savings, but are unable to quantify it beyond the realm of probability. I’ll give you an equal example, just to show my brilliance as compared to the OIG. Sometime in the future, on any given roulette wheel, someone will land on the Green zero, and the amount of the payout will vary based on the bet. For this display of brilliance, I’ll expect my first government pension check next Friday.

As Ben Franklin once stated, and Gladys Knight & The Pips later paraphrased in song (I prefer this version, as it’s got soul!), “Believe half of what you see, and none of what you hear”. In matters related to government reports, the percentage of belief in what you see is directly proportional to the level of information presented. In the cases of these reports, the percentage plummets from half to near-zero. From my comfortable spot in the skeptic’s world, I could have told you so.

Tags: , , , , , , , , , , , , , ,
December 5th, 2012 | 1 Comment »

Of RACs, ALJs, Medicaid and Elections

Posted by J. Paul Spencer, CPC, CPC-H in Health Care Reform

All hail Autumn, that season of incorrect pundits who are never fired, far-too-early holiday shopping and rotting jack-o-lanterns. Perhaps it’s the plummeting temperatures that stunt the blood flow to the brain, but the world gets slightly dumber at this time of year. In four-year cycles, when a presidential election is thrown into the mix, the stupidity becomes profound and seemingly intractable.

For this week’s Friday rumination, we are going to explore two key pieces of health care reform, one that is already in place and one that will take place 13 1/2 months from now. Sadly they are intertwined, and the former is doing damage to the latter, and, by extension, to all hopes of meaningful reform.

When I’m not driving all over the country as part of my chosen profession, I spend my Wednesdays talking about the evils and inconsistencies of government audits in this space. When RAC audits were expanded in the lead-up to PPACA, the country was told that collections from improperly paid claims would pay for health care reform. With that calculus as a premise, two important follow-up questions were left unanswered:

  • What if the audits are unsuccessful?; AND
  • If they are successful, what will be the financial effect on the provider community?

 

In assessing three years of work with the Medicare Recovery Audit Program, perhaps “successful” is the wrong word. We get what I call the Quarterly Whitewash Reports from CMS about the “success” of the RAC program, but with the AHA estimating provider appeal success rates in the 75% range, “success” becomes an empty term. As stories of the damage RACs incur on rural and critical access hospitals proliferate, and knowing that RAC response is a negative revenue proposition for everyone else, the initial bravado of CMS amounts to an empty promise.

Given the successful appeal rates, CMS and the OIG have spent the bulk of the last 13 months attempting to stack the deck against providers in order to meet the predetermined financial goal of paying for reform with audits. This began in September of 2011 with a dollar limit on reimbursement to providers for providing medical records to the RACs. This was followed with a record request percentage increase in March, in the hopes that resistance would then be futile and money would flow back into CMS. Yet instead of packing up their RAC response units and chalking it up to “the price of doing business”, hospitals doubled down, appealing the blatantly incorrect audits from the contractors as far into the Medicare Appeals process as possible. Administrative law judges (ALJs) nationwide have been overturning scores of RAC determinations and, in the case of short stays, ordering Part B benefits to be paid.

If a report issued by the OIG this week is any indication, the ALJs and their seemingly endless collection of monkey wrenches are about to get an uncomfortable makeover.

In the OIG’s report, it was found that 56 percent of Level II QIC appeal determinations were overturned by the ALJs in Fiscal Year 2010. In addition, it was found that when CMS took part in ALJ hearings, the provider’s chances for a favorable decision decreased.

There were ten recommendations coming out of the report, but there were three that were directed at the Office of Medicare Hearings and Appeals (OMHA) that further indicates that the Federal branch of government is willing to go to extraordinary lengths in order to make the pipe dream of audits paying for health care reform a reality.

First, the OIG wants OMHA to seek statutory authority to institute a filing fee for appeals to the ALJ level. Remember again that fighting the RAC contractors always incurs a loss, because the provider is not trying to make a profit, but to secure dollars already received and reinvested back into operations. If you aren’t paid for all of the records you provide, and you are then required to provide a filing fee for level 3 appeals, the dollar loss in defending past reimbursement begins to add up when multiplied by hundreds of incorrect RAC determinations.

Second, the OIG wants OHMA to implement a “quality assurance process” to review ALJ decisions. Look at this recommendation from an ALJ’s perspective. If, according to the report, 72% of all ALJ appeals from hospitals are overturned in the provider’s favor, does that number decrease if the ALJ knows that someone is going to second-guess them in a QA process?

This question becomes more important with the third recommendation that caught my eye, which is to continue to increase CMS participation in ALJ appeals. When CMS is absent from an ALJ hearing, providers are 33% more likely to have a QIC determination overturned. If the OIG had their way, providers would pay for the privilege of an ALJ hearing, would have to combat CMS at the hearing and have the hearing presided over by a judge looking over his or her shoulder. If this isn’t the very definition of “stacking the deck”, can anyone reading this provide me with a better example?

Which brings me to the Medicaid part of this equation. The biggest portion of PPACA is a now-optional Medicaid expansion to populations that have not been covered in the past. Over the past few months, Medicaid RAC programs have begun in earnest, with (not surprisingly) the same types of abysmal results beginning to rear their heads. If this article from yesterday’s New York Times is any indication, high-dollar Medicaid providers are in the crosshairs of state fraud control units.

The Medicaid RAC program has no mandated limit on the number of services that can be pulled, and there is no clear definition of just who can conduct the reviews. Seeing the wreckage being caused by the Medicare RAC program, and noticing that Medicaid is following suit, is this the best strategy to implement when you are trying to convince providers to increase their Medicaid patient population?

Last week’s election has decreased the chances of any part of PPACA being disposed of legislatively to very near zero. Yet if CMS’ aggressive audit stance continues, the chances of PPACA suffering a lethal, self-inflicted wound increase if providers decide to throw their Medicaid keys on the table and walk away. In that setting, with regard to health care, did the election really have consequences? Stated another way, perhaps it is better to look upon PPACA as yet another rotting jack-o-lantern?

Tags: , , , , , , , ,
November 16th, 2012 | No Comments »

Welcome to the 2013 OIG Work Plan

Posted by J. Paul Spencer, CPC, CPC-H in OIG Issues

There are subtle indications that this particular October is going to be somewhat different from those past. The NHL is locking out its players, the political season is creating a particularly virulent strain of stupidity and I find that I have suddenly lost my tolerance for Oktoberfest beers.

Yet if it’s early October in the United States, we have something that was released on Tuesday that arrives with the reliability of the Sun and organic death; the 2013 OIG Work Plan.

This year’s plan brings with it 148 pages of new and old areas of focus, which is slightly smaller than last year. Let’s jump right in and discover what to expect over the next year.

The hospital world is already up in arms about one particular aspect of the OIG’s Part A plan. The OIG is going to analyze claims data to determine how much money could be saved by CMS “if it bundled outpatient services delivered up to 14 days prior to an inpatient hospital admission into a DRG payment”. Currently, the DRG payment window is set at 3 days.

In my mind, if this is the first salvo towards a proposed rule on a 14-day payment window, hospitals across the country that were planning to build ambulatory surgical centers (ASC) that they would own and operate more than likely just scrapped their plans. Those hospitals that currently wholly own their ASCs are probably going to redraw the contracts to bring in partial new ownership to make certain that services there never fall under the DRG window. If a patient has a procedure in a hospital-owned ASC, the patient goes home and within two weeks has a complication necessitating an inpatient stay, suddenly the ASC services would be bundled into the DRG payment. Worse yet, if CMS and the OIG define the complication as acquired at the facility, would this lead to CMS paying nothing for eitherencounter under their desired future payment paradigm? It is comparable to being hit by a bus while crossing the street and being sent flying across the double yellow line into the path of a Peterbilt truck.

In 2011, the Work Plan began to look at the proper use of swing beds within a hospital. This year’s plan expands on that, looking at transfers from one hospital into a swing bed at another hospital. Specifically, the OIG wants to know if these cases were handled as discharges by the first hospital, rather than the proper procedure of a transfer. Additionally on this topic, the OIG is going to look at payments for swing-bed services in critical access hospitals and compare them to payments in skilled nursing facilities in an attempt to identify savings.

Also new to the hospital realm within the work plan are:

  • An analysis of the changes in inpatient stays from FY 2008 to FY 2012;
  • Review of payments for hospital discharges that should have been coded as transfers;
  • A closer look at what happens from a payment perspective when a surgical procedure is cancelled during an inpatient stay;
  • The appropriateness of Medicare payments for mechanical ventilation;
  • Assessing the work product of contracted Quality Improvement Organizations (that’s $1.1 billion in contracts, folks!); AND
  • Hospital acquisition of ASCs and possible subsequent conversion to hospital outpatient departments, leading to higher reimbursement.

 

Continuing in the Part A realm, the OIG is once again revisiting the administration of atypical anti-psychotic drugs, with a closer look at the characteristics of the nursing homes that use them more frequently that others (I think we used to call them “communes” in my infancy).

Let’s delve a little bit into Part B. I’d like to start with some of the new issues on the Program Integrity front. The OIG wants to know how often on-site visits are happening for providers and suppliers during the enrollment / re-enrollment process. The OIG found in a prior review that 33% of DME suppliers in South Florida did not have a physical facility. As an adjunct to this finding, the OIG will also be looking at the improper use of commercial mailboxes opened with the specific intent being to defraud the Medicare program.

A few specialties are new on the radar. Anesthesiologists billing with the “AA” modifier for services (indicating that the services were personally performed, rather than supervised) will have their claims reviewed to verify that this information is correct. Ophthalmologists, who were paid $6.8 billion in FY 2010, will have their claims reviewed for what the OIG calls “questionable billing”. A similar probe will be done for needle EMGs and nerve conduction studies, which puts neurologists and neurosurgeons on notice nationally.

Some issues are continuing from previous years, such as reviews of providers that have proven themselves to be error-prone in CERT testing, the high utilization of sleep testing procedures and ASC payment methodology.

The ongoing drug shortages happening throughout the country are now drawing the attention of the OIG. In addition to studying the experiences of physicians and hospitals dealing with the shortages, the OIG is also looking at manufacturer sales of drugs in short supply. With drugs being vastly overpriced thanks to manufacturer-friendly language in the law that created Medicare Part D, the OIG is looking into instituting a drug rebate program for Part B drugs similar to what is in effect for Medicaid. Along the same lines, the OIG is continuing its investigation into the differences between average sale  price and average manufacturer price.

Long overdue is a two-front investigation of Medicare Administrative Contractors which will assess their performance and their use and management of system edits for claims processing. When set alongside the OIG’s intention to review CMS’ contracting landscape and looking into whether contractors are meeting requirements for error-rate reduction, it would appear that a new front has been opened up in investigating why the Medicare payment error rate remains ridiculously high, and in the opinion of this writer, not a moment too soon.

In addition to the work plan, the OIG is planning a free webcast on October 24th as a follow-up to the plan’s release. More information on this can be found here. Enjoy perusing the pages of the work plan, as past plans have provided a foundation for long-standing audit issues. The Work Plan is never the bearer of bad news, but rather the best road map for the future. I know you have plenty of time to read it, as there is no hockey to watch.

Tags: , , , , , , , , , , , , , ,
October 5th, 2012 | No Comments »

The RAConteur: A RAC By Any Other Name…

Posted by J. Paul Spencer, CPC, CPC-H in The RAConteur™

Since this happens to be a year when a presidential election occurs, we can expect that over the next 10 weeks, we shall be subjected to well-choreographed and carefully-tested speeches that refer to what makes the United States “the greatest country in the world”. To save everyone some time for other more wholesome activities, let me give you the correct analysis of this question.

America, more than any place on Earth, offers above all things the possibility of re-invention. In the simplest terms, we are a collection of the refuse from the rest of the world. All of us ended up here because either ourselves or our ancestors were precipitously close to the bottom of life’s ladder somewhere else. As an example, one of my great-grandfathers on my mother’s side left the British Isles, where he was a simple alcoholic, and came to America, where he rose to the level of employed and thriving binge drinker. Three generations later, you all get this blog.

One unique quirk about our system is that the possibility of re-invention never ends once you get here. Nowhere is this more apparent than in the business world. If people associate the name R. J. Reynolds with deadly tobacco products, no problem. They can just change their name to ALTRIA, which is a field-tested, nondescript word that doesn’t make people think of lung cancer. If medical billing company Medaphis finds itself under an OIG corporate integrity agreement, no problem. They can call themselves Per-Se Technologies and start again. I once asked my good friend and compatriot Curtis to describe America in five words or less, and he said “Cosmetic surgery”. Maybe this is what he was talking about?

This month, the wheels of re-invention struck the RAC world, when DCS, the Region A RAC, announced that they had changed their name to Performant Recovery, Inc, “a subsidiary of Performant Financial Corporation”. Performant has been a government contractor performing various collection activities for federal programs since the late-1990’s. Federal contractors never truly go away…..

This particular name change is not a quest for sudden anonymity that comes with finding that you have been knee-deep in questionable activity, such as Altria and Per-Se. Yet if there is any process in the realm of healthcare that would benefit from a dark cave and a disguise, none is more in need than the recovery audit process.

CMS has repeatedly stated that the RAC effect on administrative burden should be minimal. It would be extremely hard to make that argument to hospital systems, some of whom have had thousands of additional documentation requests. It is equally impossible to make that argument to administrative law judges around the country, who are beginning to grouse about the rapid expansion of the number of RAC appeals on their dockets.

Sometimes, reinvention takes more than either a change of scenery or a simple name change. It takes a renewed commitment to performing tasks that are of benefit to society at large. When rural hospitals are threatened with extinction due to predatory recovery practices, which forces choices between patient care and administrative activities, a RAC by any other name is still a RAC.

This particular attempt at reinvention is more akin to the federal witness protection program. A gangster in a small town under an assumed name is still a gangster, and your presence and way of doing business, in any form, is not appreciated.

Tags: , , , , , , , ,
August 29th, 2012 | No Comments »

Vultures Team With Blind Skeet-Shooters To Fight “Medicare Fraud”

Posted by J. Paul Spencer, CPC, CPC-H in CMS

At this point, it’s safe to say that you all have an inkling of how I think and the direction from which I approach topics related to health care. I have presented facts regarding issues that affect those with a financial stake in our health care system, which let us not forget includes doctors and patients (remember them?).

I have been critical of government “anti-fraud” efforts, mainly because a payment error isn’t always indicative of fraud. Sometimes, as we would expect with a confusing behemoth of a system such as ours, typical human error rules the day. I have been a certified medical coder for 14 years and I can tell you that every once in a while, two digits get transposed, not because I have a diabolical plan to buy a classic, mint-condition Ferrari Daytona by padding my wallet one office visit at a time, but because I’m human, imperfect and make mistakes. For further evidence of this, I direct your attention to the file marked “Marriage, First”.

It was with these thoughts in mind that I read a press release from CMS that hit my e-mail box yesterday. CMS proudly announced that they will now be teaming with assorted insurance carriers, insurance commissioners, the OIG, the FBI and an alphabet soup of insurance industry anti-fraud front groups to fight health care fraud with something of a united front. The partnership has the stated short- and long-term goals of information sharing, the ability to stop payments for the same patient on the same date from payers in different cities and using technology to predict and detect fraud schemes long before the damage is done.

There is one problem with this approach, as I see it. The two main players in this partnership, CMS and the insurance industry, are approaching the partnership with opposing sets of guiding principles.

The government, in the form of CMS and the Obama Administration, wants to eliminate waste, fraud and abuse in government healthcare. The Administration is desperately in search of good news news with regard to bringing improper payments under control, so much so that contracted entities such as the Recovery Audit Contractors (RACs) and the Zone Program Integrity Contractors (ZPICs) are now the beneficiaries of rules of combating overpayments deliberately tilted in the favor of the auditor. This is being done for no other purpose but to achieve the desired monetary results for CMS. After that, claiming success becomes a fait accompli.

On the other hand, the insurance industry wants to provide premium value to its stockholders. It is naive to think that the insurance industry has a goal that revolves around anything other than maximizing profits and retaining the maximum amount of  money in premiums by consistently lowering the amount paid in benefits to health care providers and patients. When approaching the partnership from their particularly odious side of the fence, working with the government to lower “fraudulent” payments makes perfect sense.

To justify the partnership, CMS goes on to state that the partnership builds on efforts that, “have resulted in a record-breaking $10.7 billion in recoveries of health care fraud over the last three years”. Disputing that stated collection total, line-by-line, would provide fodder for my writings through the end of the calendar year. In other news, I turned approximately 25,000 years old on my last, record-breaking birthday, but bear in mind that I am human and prone to error.

Somewhere in CMS’ press release, facts go unstated. There are a lot of improper Medicare payments going out the door, the problem needs to be brought under control, and we need a fresh approach. Yet, if the goal of CMS is to build the trust of the provider community regarding payment integrity, teaming with the carrion-chewing vultures of the insurance industry may not be the best approach. Trust will come only when all participants in the process are devoid of a profit motive for conducting activities.

That sound you just heard was me not holding my breath awaiting that circumstance.

Tags: , , , , , ,
July 27th, 2012 | 2 Comments »

The RAConteur: ZPIC Contracting Conflicts

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

I ask the pardon of my readers for the brief absence from this space. Due to work-related volumes, the Fi-Med blog has been delayed, but we now return to bring you the latest in audit news and healthcare trends.

As I have opined in this space previously, a virulent orthodoxy has embedded itself into the halls of Washington, D.C., and slowly to the rest of the country, that private enterprise can always perform basic tasks better than the government can on its own. A deep look into every Cabinet-level agency can find some example of bureaucracy run amok, yet with the blood-lust for private contracting in all areas of government, a new paradigm has emerged. What was once a government that worked slowly, and within a set of defined rules, is now in the hands of a private sector that fights to justify its existence as a contract holder by any means necessary. As a codicil to this shift, it appears that once a company receives a government contract, there is no behavior so egregious that the contractor doesn’t stick around in one form or another doing something at the expense of taxpayers.  

The Centers for Medicare and Medicaid Services, based on their independent contractors, has under its umbrella some of the worst examples of this behavior. It is a seldom-spoken truth that CMS contractors never really go away, but rather metamorphose into something else that takes its money from the government in the form of a contract for services.

The Office of Inspector General overseeing the Medicare program released a report on July 9th that shines a light on the shell games that go on with Medicare contractors, in this case with Zone Program Integrity Contractors (ZPIC). The OIG decided to take a look at the relationships between the ZPIC contractors and their subcontractors to assess conflicts of interest that could hinder their work product.

In reviewing the contractors, the OIG identified 10 actual conflicts and 1,451 possible conflicts with the companies who are now either contractors or subcontractors under the ZPIC program. These conflicts were related to contractual relationships either with CMS or with other contractors of CMS that provide various other services. In most cases, the companies analyzed did not consider these internecine relationships to be actual conflicts, more than likely because CMS does not have a written policy for reviewing conflict of interest information.

Now, let’s combine this information with another OIG report that was released this past November, which showed that data issues between CMS and the ZPIC contractors has severely hindered the work product of the ZPIC program. This same report stated that over the history of the Program Safeguard Contractor (PSC) and ZPIC programs, less than 2% of all dollars identified as fraudulent have been collected by the contractors.

The picture that is beginning to emerge on the ZPIC program is beginning to look less like Ansel Adams and more like Ralph Steadman. What we have are contractors, aggressively going after identified “fraud” targets, that may very well have a monetary interest in pursuing one target over another, at the expense of the entire Medicare program. With actual results rating so low on the completion scale, I may very well have stumbled upon the best example of private enterprise siphoning contract funds out of CMS for no other reason than to prop up private industry to satisfy orthodoxy. Unfortunately, it is taxpayers and medical providers attempting to do the right thing that pay the penalty under this belief system.

Tags: , , , , , ,
July 18th, 2012 | 2 Comments »

The RAConteur: ….And Medicaid Isn’t Working, Either

Posted by J. Paul Spencer, CPC, CPC-H in The RAConteur™

It is somehow fitting that today, the first day of Summer, serves as the birthday of Brian Wilson, the now-70-year-old musical engine behind the great songs of The Beach Boys. I’d love to be at the beach right now, belly-surfing like a seal in the semi-clean waters that surround the North American continent, but this dream will have to be deferred for today. I’ll give you a song you can listen to to put you in that place while I document the latest audit atrocity.

I made reference in a past posting about the poor showing of the Medicaid Integrity Program, as reviewed by the OIG. The two reports from the OIG seemed to criticize the selection of audit targets by CMS that were eventually referred to the Audit Medicaid Integrity Contractors (MIC). The biggest suggestion that came out of those reports was for CMS to pursue collaborative audits between CMS, the OIG, the MIC’s and the individual Medicaid State Fraud Control Units.

In the past week, criticism of the program came from another portion of the Oversight Universe, that being the Government Accountability Office (GAO). According to a report released on June 14th (just in time for Flag Day), conducting Medicaid fraud audits since 2008 has cost the government $102 million, and has led to the collection of less than $20 million. Unlike the previous OIG reports, the GAO pointed a finger at the data retrieved from the Medicaid Statistical Information System (MSIS), which CMS has used to identify audit targets.

The MSIS system includes raw claims data, but excludes such important elements as “to which provider do these suspect claims belong?”. Remember kids, the only way you can identify anything in this world is to give it a name in a form you can recognize, as I learned when I was small when someone told that the instrument I was playing was in fact a trumpet, and not a “blowy, push-button thingy”.

As an additional point, the GAO indicated that the National Medicaid Audit Program is desperately in need of redesign, which is a fact that the Medicaid Integrity Group (MIG) has acknowledged and attempted to commence. To date, no details have been reported to Congress as to what changes are being made and why. The GAO criticized the audit program for its lack of transparency based on this, as well as other related factors.

Providers continue to feel the jellyfish-like sting from an alphabet soup of government audit initiatives. The many programs serve mainly as a burden to providers who wish to do the right thing, but instead encounter programs whose design predetermines their ongoing failure. Like waves crashing on the sand at nightfall, every type of audit repaints claims data with a heavy and indifferent brush. With various government agencies finding problems with the design and execution of government audits, it appears providers have very little opportunity to move away from the surf to safety anytime soon.

Tags: , , , , , , , , ,
June 20th, 2012 | No Comments »

The RAConteur: CMS’ Ongoing Appeal Fairy Tales

Posted by J. Paul Spencer, CPC, CPC-H in The RAConteur™

It is inevitable that once in all of our lives, each one of us shall receive bad news. As a result, people are suckers for apparent happy endings. As a relevant current example, television talent competitions are stocked to the rafters with contestants that have heart-touching back stories and only fair-to-middling talent, which goes a long way to supplying a false sense of security in a populace that has been conditioned to accept bad news as normal. In reality, happy endings are few and far between, there are no magical winged ponies or unicorns and people are not suckers solely in the realm of desiring such a happy ending.

For all of these reasons, I exist in life as something of a cross between a spirit guide and interpreter, leading all of those within my sphere of influence toward a higher truth by finding the illusions implanted in other things. It is in this capacity that I come to you today, and since it is Wednesday, the subject today is the CMS version of the effectiveness of the Recovery Audit program.

On June 1, without fanfare (as has been their habit lately), CMS released a one-page appeals update for the RAC program. If you concentrate on just the numbers in the report, you would come to the sugar-coated conclusion that the percentage of claims overturned on appeal for all denials stands at 2.7% for Fiscal Year 2011, which concluded on September 30, 2011. The total number of dollars overturned, to hear CMS tell it, was $37.9 million. If the update stopped there, the prince and the princess would live happily ever after. Unfortunately, the update contains small print that in this case deflates the entire argument.

On the update, below numbers showing the number of claims with overpayment determinations and the numbers appealed, CMS includes this phrase:

“The number of claims that have been appealed is limited to claims originating in FY 2011, with appeals initiated through 9/30/2011. Each level of the appeal process has statutory time frames that provide due process to providers. Since these time frames extend beyond the end of the fiscal year, each update will represent a snapshot in time to ensure accurate data.”

The translation to this is that the numbers in the CMS update address only completed appeals that began during the last fiscal year. In CMS’ zeal to deliver good news, they have left out an enormous universe of appeals still in process. According to the latest AHA RACTrac survey report that was released on May 10th, seventy-five percent of RAC appeals are still in process, many at the 2nd or 3rd level. Suddenly, when we get a full view of the appeal picture, CMS’ representation of the success of the RAC program comes off as less than truthful.

The timing of the release of this report requires some critical thinking as well. I wrote a few weeks ago about the U. S. Senate Finance Committee requesting “white papers” from all interested stakeholders with recommendations on how to reduce fraud, waste and abuse in the Medicare program. The Committee’s deadline for submissions is the end of June.

CMS has been teetering along a carefully-drawn line of their own design that at all times brings forth a public stance that is best distilled by the phrase, “Remain calm. All is well”. With outside entities such as the General Accounting Office, the OIG and the AHA generating report after report stating that the current multi-tiered approach to improper payments is failing at all levels, CMS is becoming desperate to present evidence that shows that the opposite of the reports is true. From the Centers’ vantage point, even a small, carefully-crafted version of good news is worth reporting. Unfortunately, what CMS has produced is the stuff of legend; not quite true, not quite false and leaning heavily towards exaggeration.

The problem with this approach is that CMS is not Babe Ruth. There will be no miracle two-home-run games for the sick child, no called shot and no bigger-than-life persona that can magically turn the disease-infested plague drama that is current anti-waste efforts into a happy story for the ages. I exist today to tell you that CMS’ RAC appeal numbers do not add up. If this post has helped just one person avoid being a sucker for a day, I consider my journey a success.

Tags: , , , , , , , ,
June 6th, 2012 | 2 Comments »

« Older Entries