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Posts Tagged ‘Medicare Reimbursement’

Reimbursement for Telemedicine and Telehealth Services

Thursday, April 11th, 2013

Reimbursement Rules for Telemedicine Slow to Develop

The absence of consistent, comprehensive reimbursement policies has historically been one of the most serious obstacles to the development of telemedicine.  Without uniformity in reimbursement it is much more difficult for providers to develop economically self-sustaining telemedicine programs.  If reimbursement is inconsistent, providers must look to other factors, such as enhancement of efficiencies, to justify the development of new telemedicine technologies.  We are beginning to see changes in state and federal reimbursement for telehealth services, but changes are coming slowly.

All health care reimbursement policy is disjointed between a variety of federal agencies, state governments, and various types of private health care payors.  Reimbursement policies play an important role in determining the rate which new modes of providing care can develop.  CMS policy often sets some of the general rules that other payors look to when setting their reimbursement policies.  Unfortunately, in the area of telehealth coverage, CMS has not taken a progressive approach to developing a reimbursement policy.  Some progress has been made toward expanding Medicare coverage.  Yet, Medicare coverage is still severely limited and is only (with very few exceptions) available to patients that are located in specific rural areas.

Many state Medicaid programs, including Wisconsin’s Badger Care Program, provide more expansive coverage of services that are provided using telemedicine technologies.  Other states have more restrictive coverage.  Private insurance policies vary widely.  Some states have passed laws that mandate telemedicine coverage.  Even of the states that have passed mandatory laws, the nature and scope of the mandate differ widely.

Unfortunately, this inconsistency and unpredictability in reimbursement serves as an impediment to development in telemedicine.  Even when a telemedicine program is developed, reimbursement inconsistencies increase administrative burdens involved with billing for services.  The inconsistencies also necessarily increase compliance risk if the provider is not up to date and accurate as to the reimbursement rules that are applicable.

Inpatient Prospective Payment Systems Hospitals Long-Term Care Hospital Fiscal Year 2013 Rates

Friday, October 26th, 2012

IPPS Revisions Released By CMS

We are revising the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from our continuing experience with these systems. Some of the changes implement certain statutory provisions contained in the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively known as the Affordable Care Act) and other legislation. These changes will be applicable to discharges occurring on or after October 1, 2012, unless otherwise specified in this final rule. We also are updating the rate-of-increase limits for certain hospitals excluded from the IPPS that are paid on a reasonable cost basis subject to these limits. The updated rate-of-increase limits will be effective for cost reporting periods beginning on or after October 1, 2012.

 We are updating the payment policies and the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs) and implementing certain statutory changes made by the Affordable Care Act. Generally, these changes will be applicable to discharges occurring on or after October 1, 2012, unless otherwise specified in this final rule.

 In addition, we are implementing changes relating to determining a hospital’s full-time equivalent (FTE) resident cap for the purpose of graduate medical education (GME) and indirect medical education (IME) payments. We are establishing new requirements or revised requirements for quality reporting by specific providers (acute care hospitals, PPS-exempt cancer hospitals, LTCHs, and inpatient psychiatric facilities (IPFs)) that are participating in Medicare. We also are establishing new administrative, data completeness, and extraordinary circumstance waivers or extension requests requirements, as well as a reconsideration process, for quality reporting by ambulatory surgical centers (ASCs) that are participating in Medicare.

We are establishing requirements for the Hospital Value-Based Purchasing (VBP) Program and the Hospital Readmissions Reduction Program.

 DATES: Effective date: This final rule is effective on October 1, 2012.

CMS Backpedals on Medical Staff Director Requirement

Thursday, July 5th, 2012

In May 2012, CMS issued final regulations containing new conditions of participation requirements for hospitals. One new requirement that was included in final regulations was the requirement that one or more members of the medical staff be included on a hospital’s governing body. The medical staff director requirement had not been included in previous proposed regulations and took the industry by surprise when it was included in the final regulations. The requirement was scheduled to go into place effective July 16, 2012.

 Several organizations, including the American Hospital Association, objected strongly to CMS issuing the final rule without the opportunity for stakeholders to provide any input into this new requirement.

 In a recent release from CMS, it appears that CMS may be backpedaling on this requirement. However, a June 15, 2012 memorandum from CMS to State Survey Agency Directors instructs state survey agencies not to attempt to assess compliance with this requirement or cite deficiencies without receiving further instructions from CMS. The memorandum also provides that accrediting organizations are not required to revise their standard or survey processes until CMS has addressed the issue completely.

 At least for now, the requirement that a medical staff member be included on the Board of Directors of a hospital need not be implemented. Stay tuned for further releases from CMS on this issue. It appears possible that CMS will reverse its decision on this issue in view of the regulatory deficiencies used to adopt the requirement.

Primary Care Rate Increases in Proposed CMS Rule

Tuesday, May 15th, 2012

Primary Care Would Benefit From Proposed Rate Increases

Centers for Medicare & Medicaid Services (CMS) has published a proposed rule that will have the net affect of increasing Medicaid payments for some services provided in a primary care setting. The propsed rule, which was published on May 11, 2012 would implement provisions of the Patient Protection and Affordable Care Act that requires that Medicaid reimbursement for certain primary care services be increased to Medicare levels instead lower Medicaid rates that have been established by the states.  The rate increases apply to primary care services provided by family medicine, general internal medicine, or pediatric medicine physicians.  The increased payment for these services will be funded by the Federal government.

OIG Audits Reveal Areas of Billing Compliance Risks

Monday, December 19th, 2011

Recent OIG Billing Audits Are Reflective of Risk Areas for Hospital Billing

Medicare OIG Billing Audits InpatientThe Office of Inspector General Audit Division has released the results of a billing audit that it performed relative to Norwood Hospital, a 264-bed acute care facility located in Norwood, Massachusetts. The audit included certain identified claims for inpatient and outpatient services provided to beneficiaries from July 2008 through June 2010.  The OIG  audit covered $1,204,371 in Medicare payments for 198 claims (123 inpatient and 75 outpatient) that were judgmentally selected by the OIG as potentially at risk for billing errors.  A complete report of the Norwood audit can be found at: Norwood OIG Audit Report

The audit found that the Hospital complied with Medicare billing requirements for 99 of the 198 claims. However, 99 claims had errors, resulting in overpayments totaling $206,836. The OIG determined that the overpayments occurred primarily because the Hospital did not have adequate controls to prevent incorrect billing of Medicare claims and did not fully understand the Medicare billing requirements.

The audit of Norwood was part of the OIG’s routine process to identify certain billing areas that are at a high risk of error.  The OIG has announced that it plans to conduct more of this type of review on an ongoing basis.  As such, the nature and outcome of this review process can be instructive to hospitals who may find themselves on the receiving end of one of these audits.
The OIG has outlined the general areas where it will focus its audits and has identified these areas as “risk areas.”  Risk areas identified by the OIG includ claims billed for:

  • inpatient short stays,
  • inpatient same-day discharges and re-admissions,
  • inpatient claims billed with high severity level DRG codes,
  • inpatient claims paid in excess of charges,
  • outpatient claims billed with modifier -59,
  • outpatient claims billed during inpatient stays,
  • outpatient evaluation and management services billed with surgical services,
  • outpatient claims paid in excess of charges, and
  • outpatient dental services.

The report from the OIG identified more specific errors that the Hospital was found to have made and wich led to the overpayment determination.  These specific findings are quite instructive.  Facilities should consider including these areas as potential risk areas for targeted internal review.  In some cases, these areas a facility may wish to provide focused training and instruction to billing staff of other relevant employees in order to reduce the risk of inaccurate claims being made.

Some of the specific areas that were a problem in the Norwood audit included:

  • Incorrect billing of Medicare Part A for beneficiary stays that should have been billed as outpatient or outpatient with observation services.
  • One claim did not have a valid physician order to admit the beneficiary for inpatient care
  • Incorrect billing for inpatient claims with same-day discharges and re-admissions.
  • Billing with incorrect DRG codes for several cases with high severity level DRG codes.

Part A Medicare Appeal Process Described

Monday, June 13th, 2011

Appealing Part A Adverse Reimbursement Determinations

Providers that are reimbursed under Medicare Part A have the opportunity to appeal adverse determinations of claims that they submit for payment.  There are two general types of appeals, depending upon whether a provider is appealing a claim or reimbursement under a cost report.

Medicare administrative contractors (“MACs”) review and process claims made under Medicare Part A.  When a claims determination is negative, the provider may appeal the decision within 120 days of the initial determination.  The provider requests a MAC for a redetermination of its claim.  Once the initial redetermination appeal is filed, the MAC has 60 days to make a redetermination.  The next step in the process is for the provider to request that a qualified independent contract (“QIC”) be appointed to reconsider the MAC’s denial.  The provider has a right to request a QIC review within 180 days following a negative redetermination by the MAC.  The QIC must render a reconsideration decision within 60 days following the provider’s request.


If the determination is still adverse to the provider, and if the amount in controversy exceeds a certain minimum amount, the provider may seek review of the claim by an administrative law judge (“ALJ”).  The request for administrative law judge review must be made within 60 days following the QIC’s determination.  The amount in controversy must exceed approximately $130.  Multiple controversies can be aggregated in order to meet this threshold the administrative law judge is required to submit a ruling within 90 days after the record of review is completed.


The next step for a provider who receives an adverse review by an administrative law judge is to request a review by the Medicare Appeals Council.  This review must be requested within 60 days of the ALJ’s ruling, and the Appeals Council must rule within 90 days after the request.


The last step for a provider assuming a continued negative result, is to file a claim with the Federal District Court.

 Procedures are different for appeals based upon adverse cost report determinations.  Cost report appeals are initiated when the MAC issues a notice of program reimbursement.  The notice of program reimbursement will include a determination of what costs are allowable and will identify any underpayment or overpayment due to or from the provider.  The provider is given 180 days from receipt of the notice of program reimbursement to file an appeal.  Where an amount in controversy is less than $10 the provider must appeal directly to the MAC.  For the smaller claim amounts the MAC decision will be reviewed by the administrator of CMS; however, there is no potential for judicial review of claims involving $10,000 or less.

The Provider Reimbursement Review Board (“PRRB”) hears cost report appeals where the dispute involves $10,000 or more.  PRRB decisions may be reviewed by the CMS administrator.  Amounts in controversy over $10,000 are also subject to court review.  This is just a brief summary of some of the appeal procedures for Part A providers.  Please contact our offices or speak with your usual health care attorney for more detail on these procedures.

Home Health Hospice Face-to-Face Certification Rule

Thursday, April 7th, 2011

CMS Begins Enforcing Home Health and Hospice Face To Face Rule

On March 31, 2011, the Center for Medicare and Medicaid Services issued a statement that it intends to begin enforcing the home health and hospice “face-to-face” requirement.  The Accountable care Act established a face-to-face encounter requirement before eligibility for Medicare home health services can be certified.  A certifying physician is now required to document that the physician or a non-physician practitioner that works with the physician has seen the physician “face-to-face.”  Face-to-face encounters with hospice patients must also occur  prior to the patient’s 180th-day re-certification, and each subsequent re-certification.

 The face-to-face requirement went into effect on January 1,  2011 but CMS announced in December 2010 that it would suspend enforcement for the first calendar quarter of 2011 in order to give providers additional time to establish compliance protocols.  CMS has stated that it expects providers (home health and hospices) to have fully established and implemented internal processes to be in compliance with the face-to-face requirement and by April 1, 2011, Home health providers and physicians are required to ensure that a face-to-face encounter with a home health or hospice patient occurs within the 90 days prior to the start of care, or within the 30 days after the start of care in order to appropriately certify the need for home health services.  Documentation of the face-to-face requirement must be included with patient certifications.

John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
500 First Street, Suite 8000
P.O. Box 8050
Wausau, WI 54402-8050

Tel 715.845.4336
Fax 715.845.2718

Ruder Ware is a member of Meritas Law Firms Worldwide

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