Yesterday the Inpatient Prospective Payment System (IPPS) proposed rule for the fiscal year 2013 was published in the Federal Register.  It will be effective for discharges October 1, 2012.  Some highlights include:

• A 2.3% increase in payment rates due to inflation, improvements in productivity, a statutory adjustment factor and adjustments for hospital documentation and coding changes.
• The addition of two new Hospital Acquired Conditions which include surgical site infection following cardiac implantable electronic device (CIED) and iatrogenic pneumothorax with venous catheterization.
• New policies and measures for the Value-Based Purchasing (VBP) program to reward hospitals for their performance and their improvement of performance.
• A total documentation and coding adjustment reimbursement rate of 0.2%.
• Changes to the Readmissions Reduction Program methodology, which was implemented in the IPPS Final Rule for FY 2012, including finalization of the readmission definition, the proposal to codify the definition of ‘excess readmission ratio’, and defining the base operating DRG payment amount.
• There are minimal changes to the ICD-9-CM code set since it is to be used until October 1, 2014.
• Limited updates to the complications and comorbidities (CCs) and major complications and comorbidities (MCCs), including the addition of three CCs to the list and the change of one MCC to CC.

CMS will accept comments on the proposed rule until June 25, 2012. The proposed rule will be published in the Federal Register on May 11. The FY 2013 IPPS Proposed Rule can be viewed here: http://www.ofr.gov/OFRUpload/OFRData/2012-09985_PI.pdf

Yesterday, Health and Human Services (HHS) announced a new proposed rule that is in line with the previous announcement made in February of this year:

HHS Secretary Kathleen Sebelius stated, “We have heard from many in the provider community who have concerns about the administrative burdens they face in the years ahead.  We are committing to work with the provider community to reexamine the pace at which HHS and the nation implement these important improvements to our health care system.”

In accordance with the concerned expressed, HHS issued a proposed rule to delay of ICD-10 compliance by one year, moving the date from October 1, 2013 to October 1, 2014.  If adopted, the delay will allow providers more time to prepare fully for the transition to ICD-10 segments.

The proposed rule is available on fact sheets (4/9/2012): http://www.cms.gov/apps/media/fact_sheets.asp.

It can also be viewed in its entirety at www.ofr.gov/inspection.aspx.  Comments on the proposed rule will be accepted for 30 days.

We encourage providers to continue their implementation efforts towards ICD-10 compliance rather than delay them.  Healthcare Consulting staff includes certified coders and consultants certified in healthcare compliance that are available to provide expert assistance with your ICD-10 implementation efforts, including physician and staff documentation and coding training.  We are also available to assist with your ongoing compliance needs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

On March 15, 2012, the Centers for Medicare & Medicaid Services (CMS) issued a notice for all Medicare Providers, both hospitals and other institutional providers, concerning the significant increase in the amount of documentation requests that can be made by Recovery Audit Contractors (RACs). A summary of the notice is as follows:

• The maximum request amount is applied per campus, based upon the facilities Tax Identification Number (TIN) and whether the facilities are located within the same area; this is determined via zip codes.
• The request limit is based on prior year Medicare claims volume.
• The new request limit is 2% of all claims submitted for the previous calendar year, divided by eight; up from 1% in previous guidelines.
• The maximum request limit is 400 records per 45 days; the previous limit being 300 records per 45 days.
• CMS reserves the right to allow RACs to exceed documentation request limits, either by their own initiative or as a result of permission sought by Recovery Auditors.

 We recommend ensuring that you have appropriate resources and procedures in place to respond to the requests timely and thoroughly. There should be appropriate mechanisms in place to track the requested records and audit results, as well as having a team in place to review the results and appeal findings as necessary.  HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and a statistician that are available to provide expert assistance with your RAC compliance programs, including appeals.

The complete CMS notice may be viewed here

http://www.cms.gov/Recovery-Audit-Program/Downloads/Providers_ADRLimit_Update-03-12.pdf.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

Yesterday Health and Human Services (HHS) Secretary Kathleen G Sebelius announced that HHS will initiate a process to postpone the date by which CERTAIN health care entities have to comply with ICD-10.

HHS Secretary Kathleen Sebelius stated, “We have heard from many in the provider community who have concerns about the administrative burdens they face in the years ahead.  We are committing to work with the provider community to reexamine the pace at which HHS and the nation implement these important improvements to our health care system.”

The current compliance date is set at October 1, 2013, HHS will announce a new compliance date for CERTAIN health care entities moving forward.

The full press release can be found at the following link:  http://www.HHS.gov/news/press/2012pres/02/20120216a.html.

Healthcare Consulting staff includes certified coders and consultants certified in healthcare compliance that are available to provide expert assistance with your ICD-10 implementation efforts in addition to your ongoing compliance needs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

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.

To access the publication go to the following link: 

http://tiny.cc/7hup0

Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and a statistician that are available to provide expert assistance with your RAC compliance programs.

 DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

The FY 2011 Totals are as follows:

FY 2010 Total Corrections $92.3MFigures are provided in millions.

To access the quarterly report publication go to the following link:  https://www.cms.gov/Recovery-Audit-Program/Downloads/FY2011QtrlyReport.pdf.

To access the FY 2011 publication go to the following link:  https://www.cms.gov/Recovery-Audit-Program/Downloads/FY2011Corrections.pdf.

Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and a statistician that are available to provide expert assistance with your RAC compliance programs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

CMS has posted a summary of the Medicare FFS RAC corrections for the 4th quarter of fiscal year 2011.  The summary identifies the following amounts for overpayments, underpayments, and total corrections:

Figures are provided in millions.

Top issues per region:

Region A:  Medical necessity regarding renal and urinary tract disorders.

Region B:  Medical necessity regarding surgical cardiovascular procedures.

Region C:  Medical necessity regarding acute inpatient admission neurological disorders.

Region D:  Medical necessity regarding minor surgery and other treatment billed as inpatient.

Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and a statistician that are available to provide expert assistance with your RAC compliance programs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

The United States Sentencing Commission has published the updated 2011 Federal Sentencing Guidelines Manual at the following website:  http://www.ussc.gov/guidelines/2011_Guidelines/index.cfm.  Appendix C (Volume III) pages 102-120 cover the changes made to Chapter 8 Sentencing an Organization.

The following are the major changes noted in Chapter 8:

1. The following was added to the introductory commentary to clarify the factors that the sentencing court must consider, “Culpability generally will be determined by six factors that the sentencing court must consider.  The four factors that increase the ultimate punishment of an organization are: (i) the involvement in or tolerance of criminal activity; (ii) the prior history of the organization; (iii) the violation of an order; and (iv) the obstruction of justice.  The two factors that mitigate the ultimate punishment of an organization are (i) the existence of an effective compliance and ethics program; and (ii) self-reporting, cooperation, or acceptance of responsibility.” 
2. The criteria set forth in Note 3(k) under §8A1.2 Application Notes, summarizing an effective program to prevent and detect violations of law was removed.  The guidance may now be found under PART B – Remedying Harm from Criminal Conduct, and Effective Compliance and Ethics Program, Subpart 2 §8B2.1.  While the existing framework of the seven minimum requirements is still embedded in the guidance it is more specific and elaborates on the criteria and imposes greater responsibility on the governing authority and executive leadership.   It is important to note the following changes:
   • The manual now states to have an effective compliance and ethics program an organization SHALL (emphasis added) exercise due diligence to prevent and detect criminal conduct and promote organizational culture that encourages ethical conduct and a commitment to compliance with the law.
   • Due diligence now requires the organization’s governing authority to be knowledgeable about the content and operation of the compliance and ethics program and shall exercise reasonable oversight of the implementation and effectiveness of the program.
   • The manual now describes how high-level personnel of the organization are to ensure an effective compliance and ethics program.
   • Due diligence now includes employing specific individual(s) to be delegated day-to-day operational responsibility for the compliance program.  The individual(s) must also report to the governing authority regarding the effectiveness of the program.
3. The Sentencing Commission also expands on how to calculate the culpability score, makes compliance and ethics training mandatory, mandates the use of monitoring systems to detect criminal conduct, requires organizations to assess risk that criminal conduct will occur on a periodic basis, provides guidance on how to implement a compliance and ethics program in a small organization.

We recommend reviewing the updated Sentencing Guidelines for Organizations.  We also recommend reviewing current compliance policies to ensure they include all the elements specified in the Sentencing Guidelines.  

HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance, and statisticians that are available to provide expert assistance with your compliance programs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

On November 1, 2011 CMS posted the 2012 Medicare Physician Fee Schedule (MPFS) with comment period.

The following items are the major changes included in the final rule with comment period:

1. 27.4% SGR downward adjustment for services provide on or after January 1, 2012 (unless Congress intervenes).  The reduction will be on the Conversion Factor CMS uses to convert the RVU assigned to each code to an actual dollar amount.
2. CMS is expanding its multiple procedure payment reduction policy to the professional interpretation of advance imaging services.
3. Absent any additional legislation, CMS is implementing the provision that an independent laboratory may not bill the Medicare contractor for the technical  component of physician pathology services furnished to fee-for-service Medicare beneficiaries who are inpatients or outpatients on or after January 1, 2012. 

The complete 2012 MPFS Final Rule with Comment Period may be found at the following link:  http://ofr.gov/OFRUpload/OFRData/2011-28597_PI.pdf.

We recommend Medicare providers review the 2012 MPFS Final Rule in its entirety.

HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and statisticians that are available to provide expert assistance with your Medicare and Medicaid compliance programs.

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations given is general and specific questions should be directed to professional counsel.

The OIG published their semi-annual report to Congress today.  The report summarized the OIG’s efforts for the 2011 fiscal year.  Highlights from their 2011 Medicare and Medicaid enforcement efforts include:

• $5.2 Billion in expected recoveries
• 2,662 Exclusions
• 723 Criminal actions
• 382 Civil actions

We recommend providers conduct ongoing auditing and monitoring of identified risk areas.  HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and a statistician that are available to provide expert assistance and support with your compliance programs.

To access the publication go to the following link:  http://oig.hhs.gov/reports-and-publications/archives/semiannual/2011/fall/HHS-OIG-SAR-Fall2011.pdf