Quick Regulatory Update – More delay in RAC Review of Short Stays and SGR

This provides a quick update to the e-newsletter we distributed March 31, 2015 as Congress has taken the action we anticipated.

H.R. 2: Medicare Access and CHIP Reauthorization ActAdditional delay in RAC reviews of short stays

On April 14, 2015, Congress passed this bill. It delays RAC audits for inpatient stays with dates of admission between October 1, 2013 and September 30, 2015 unless there is evidence of gaming, fraud, abuse or delays in the provision of care by a provider. There had already been a delay through April 30 so this adds 5 more months to the delay. The bill will be sent to President Obama who has already indicated that he will sign it.

Audits by the MAC will continue, and there is continuing audit activity by the Department of Justice.  The medical necessity of every service paid by Medicare is ALWAYS subject to review so it is imperative to establish processes to ensure that appropriate documentation is in the medical record. Below is an excerpt from the bill.

SEC. 111. EXTENSION OF TWO-MIDNIGHT RULE. (a) CONTINUATION OF CERTAIN MEDICAL REVIEW ACTIVITIES.— The Secretary of Health and Human Services may continue medical review activities described in the notice entitled ‘‘Selecting Hospital Claims for Patient Status Reviews: Admissions On or After October 1, 2013’’, posted on the Internet website of the Centers for Medicare & Medicaid Services, {through the end of fiscal year 2015} for such additional hospital claims as the Secretary determines appropriate.

(b) LIMITATION.—The Secretary of Health and Human Services shall not conduct patient status reviews (as described in such notice) on a post-payment review basis through recovery audit contractors under section 1893(h) of the Social Security Act (42 U.S.C. 1395ddd(h)) for inpatient claims with dates of admission October 1, 2013, through {September 30, 2015}, unless there is evidence of systematic gaming, fraud, abuse, or delays in the provision of care by a provider of services (as defined in section 1861(u) of such Act (42 U.S.C. 1395x(u))).

SGR Repealed

The passage of the bill includes the permanent repeal of the 1997 law that would have cut Physician reimbursement for Medicare claims by 21% as of April 1, 2015. CMS reported that a small number of claims have already been processed at the reduced rate, MACs will automatically reprocess these claims with the new payment rate. We suggest, however that physicians and facilities flag and follow up on any reduced rate payments received.

Let us know how we can help you

If you have questions about this (or other) CMS communications or compliance requirements, please do not hesitate to contact any of MedManagement’s experts.

Joan C. Ragsdale, JD                                                   Ann M. Purdy
Chief Executive Officer                                               Chief Compliance Officer
Direct Line: 205-970-8804                                          Direct Line: 205-314-8859
JRagsdale@MedManagementLLC.com               APurdy@MedManagementLLC.com