CMS announced that beginning January 1, 2012 they will start conducting the following demonstrations:
Recovery Audit Prepayment Review – This demonstration will allow Medicare RACs to review claims before they are paid to ensure that the provider complied with all Medicare payment rules. The focus will be on claims that have a history of high rates of improper payments. The demonstration will be conducted in 11 states. Seven states with high populations of fraud and error-prone providers which include CA, FL, IL, LA, MI, NY and TX. Four states with high volumes of short inpatient hospital stays which include PA, OH, NC, and MO.
Prior Authorization for Certain Medical Equipment – This demonstration will require prior authorization for certain medical equipment for all Medicare beneficiaries who reside in CA, FL, IL, MI, NY, NC, and TX, states that have been deemed areas with high populations of fraud and error-prone providers. The demonstration will be implemented in 2 phases. The first phase will be a prepayment review on certain medical equipment claims to occur in the first 3-9 months. The second phase of the 3 year demonstration will implement prior authorization.
Part A to Part B Rebilling – The third demonstration will allow hospitals to rebill for 90% of the Part B payment when a Medicare contractor denies a Part A inpatient short stay claim as not reasonable and necessary due to the hospital billing for the wrong setting. The demonstration is limited to 380 hospitals on a first come first service basis that volunteer to be part of the program.
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