Presentation on theme: "Presentation to Tennessee Hospital Association"— Presentation transcript:
1Presentation to Tennessee Hospital Association Dennis J. Garvey, JDDirector, Office of Program IntegrityBureau of TennCare
2What is “RAC”? “RAC” stands for Recovery Agent Contractor Pursuant to the Affordable Health Care Act, the State has established a program under which it will contract with one (or more) recovery audit contractors (RACs). This contract is for the purpose of identifying underpayments and overpayments of Medicaid claims under both the State plan and under any waiver of the State plan.
3Our Authority to Perform Recovery Department of Health & Human ServicesCenters for Medicare & Medicaid Services61 Forsyth St., Suite 4T20Atlanta, GeorgiaFebruary 3, 2012Mr. Darin J. Gordon, DirectorDepartment of Finance and AdministrationBureau of TennCare310 Great Circle RdNashville, 1N 37243Re: Tennessee Title XIX State Plan Amendment, Transmittal #11-012Dear Mr. Gordon:We have reviewed Tennessee State Plan Amendment (SPA) , which was submitted to theAtlanta Regional Office on November 7, This amendment requested an exemption to therequired three (3) year look-back period by the Medicaid Recovery Audit Contractor (RAC).Due to Tennessee's Medicaid program being operated as a managed care delivery system and toallow the Managed Care Contractors time to complete their internal claims processing andprogram integrity operations, CMS approves an exemption with a five (5) year look-back period.Based on the information provided, the Medicaid State Plan Amendment 1N wasapproved on February 3, The effective date of this SPA is November 15, Thesigned HCFA-179 and the approved plan pages are enclosed.If you have any questions regarding this amendment, please contact Kenni Howard at(404)Jackie Glaze ~by David KimbleAssociate Regional AdministratorDivision of Medicaid & Children's Health OperationsEnclosures
4Look-back PeriodCMS has granted approval for TennCare to look-back five (5) years from the date of a paid claim.
5TennCare RAC FactsTennessee currently contracts with HMS to perform RAC recoveries.HMS has a three-year contract with TennCare; from February 1, 2011 through January 31, 2014; with two allowable one-year contract extensions through January 31,HMS is the RAC contractor for twenty-six (26) states.
6What does RAC cover? All TennCare Providers All TennCare claims (Fee-for-service, Encounter and Capitation)All improper payments, including, but not limited to:Incorrect paymentsNon-covered servicesIncorrectly coded servicesDuplicate servicesServices not renderedExcessive ReimbursementsReimbursement ErrorsCoverage or Eligibility Errors
7Types of RAC Audits Automated Audits Complex On-site Audits Data MatchingData MiningDesk AuditsComplex On-site AuditsFinancialClinical
8Additional RAC requirements The contractor shall refer any and all suspected fraud cases to the Bureau of TennCare.TennCare will coordinate the payment integrity efforts of the MCOs, the PBM and DBM and remove them from HMS reviews as appropriate.
9Scenario DevelopmentThe RAC request shall document the overpayment scenario, explaining the methodology used to identify the finding and citing state and federal regulations to establish good cause for the review of the claim.RAC contractor is required to present two new scenarios per quarter for approval, but are currently delivering two new scenarios each month.
10Records RequestThere is a maximum limit of three-hundred (300) record requests per provider for any 45-day period.A statistically valid random sample (SVRS) may be used for providers to decrease the amount of records needed for a suitable sample.HMS does not and shall not pay for copying medical records.
11Audit FindingsA Preliminary Recovery Findings letter will be sent to a designated contact person at each provider. It contains:Summary of provider’s response optionsAudit Report - containing a listing of each claimEvidence supporting the determinationInformation and instructions for requesting a reconsideration and/or appeal.
12Review Audit Personnel Medical DirectorRelevant Medicaid experience in a role that involves developing coverage or medical necessity policies and guidelinesGood standing with the relevant State licensing authorities and has relevant work and educational experienceBoard-certification in a medical specialty and at least three (3) years of medical practice as a board-certified physicianProfessional Nursing and Coding Staff
13Answers to Frequently Asked Questions about the RAC may be found at: RAC QuestionsAnswers to Frequently Asked Questions about the RAC may be found at:
14What is an “overpayment”? “(B) OVERPAYMENT—The term ‘‘overpayment’’ means any funds that a person receives or retains under title XVIII (Medicare) or XIX (Medicaid) to which the person, after applicable reconciliation, is not entitled under such title.”Important distinction: “funds”, not “benefit”
15Some Reasons for Overpayments Payment exceeds the usual, customary, or reasonable charge for the serviceDuplicate payments of the same service(s)Incorrect provider payeeIncorrect claim assignment resulting in incorrect payeePayment for non-covered, non-medically necessary servicesServices not actually renderedPayment made by a primary insurancePayment for services rendered during a period of non-entitlement (patient's responsibility)
16More Reasons for Overpayments Failure to refund credit balancesExcluded ordering or servicing personPatient deceasedServicing person lacked required license or certificationBilling system errorService induced by false statement of ordering providerService inconsistent with physician order or treatment planService not documented as required by regulationNo order for serviceService by an provider who is not enrolled that is “billing through” an enrolled provider
17False Claims Section 6402(g): In addition to the penalties provided for in 6402, a claim that includes seeking reimbursement for provision of items or services that violate this section constitutes a false or fraudulent claim for purposes of Subchapter III of Chapter 37 of Title 31 USC.
18False Claims Act (FCA)Expands FCA liability to indirect recipients of federal fundsExpands FCA liability for the retention of overpayments, even where there is no false claimAdds a materiality requirement to the FCA, defining it broadlyExpands protections for whistleblowersExpands the statute of limitationsProvides relators with access to documents obtained by government
19Reporting and returning of overpayments: Section 6402(a)Adds Section 1128J(d)(1)(A) to the Social Security ActReporting and returning of overpayments: “In general, if a person has received an overpayment, the person shall:(A) report and return the overpayment to the Secretary, the State, an intermediary, a carrier, or a contractor, as appropriate, at the correct address; and(B) notify the Secretary, State, intermediary, carrier, or contractor to whom the overpayment was returned in writing of the reason for the overpayment.”
20PPACA Section 6402 Medicare & Medicaid Program Integrity Provisions ‘‘(d) REPORTING AND RETURNING OF OVERPAYMENTS— (1) IN GENERAL — If a person has received an overpayment, the person shall— (A) report and return the overpayment to the Secretary, the State, an intermediary, a carrier, or a contractor, as appropriate, at the correct address; and (B) notify the Secretary, State, intermediary, carrier, or contractor to whom the overpayment was returned in writing of the reason for the overpayment.”
21What Are Funds “Not Entitled”? KickbackSTARKEligibilityConditions of payment
22Violation without Intention Section 6402(f)(2):Adds new subsection 1128B(g) of the Social Security ActAmends the federal health care program anti-kickback statute by adding a provision to clarify that “a person need not have actual knowledge of this section or specific intent to commit a violation of this section.”
23Who must return the overpayment? A “person” (which includes corporations and partnerships) who has either “received” or “retained” the overpaymentFocus on “receipt”; payment need not come directly from Medicaid; if “person” “retains” overpayment due the program, violation occursA “person” includes a managed care plan or an individual program enrollee, as well as a program provider or supplier
24When is an overpayment “identified”? “Identified” for an organization means that the fact of an overpayment, not the amount of the overpayment, has been identified. (e.g., patient was dead at time service was allegedly rendered, APG claim includes service not rendered, charge master had code crosswalk error)Compare with language from CMS proposed 42 CFR overpayment regulation 67 FR 3665 (1/25/02 draft later withdrawn)“If a provider, supplier, or individual identifies a Medicare payment received in excess of amounts payable under the Medicare statute and regulations, the provider, supplier, or individual must, within 60 days of identifying or learning of the excess payment, return the overpayment to the appropriate intermediary or carrier.”
25When is an overpayment “identified”? Employee or contractor identifies overpayment in hotline call orPatient advises that service not receivedRAC advises that dual eligible Medicare overpayment has been foundTennCare sends letter re: deceased patient, unlicensed or excluded employee or ordering physicianQui tam or government lawsuit allegationsCriminal indictment or information
26Government is Using Data to Detect Overpayments Excluded personsDeceased enrolleesDeceased providersCredit balances
27Overpayment Identification in Error An employee, contractor, patient or State may make a mistake.That is the reason why the statute gives providers 60 days to report after the identificationNeed for internal review and assessmentNo obligation to report allegation if your investigation shows that it is inaccurateBUT - risk is on provider who decides not to report
28Reduced Protection From Limitations Periods What is effect on statute of limitations?Under federal and state false claims acts, statute of limitations runs from 60 days after date of identification, not date of claim or date of payment.
29Credible Allegation of Fraud State agency makes determination of credible allegation of fraud that has “indicia of reliability”Can come from any source:Complaint made by former employeeFraud hotlineClaims data miningPatterns identified through:AuditsCivil false claimsInvestigations
30Important PointsTennCare is required to review evidence and carefully consider the totality of facts and circumstances.Suspension or even partial suspension is an extraordinary action, not a routine matter.This action is reserved only for cases where there are pending investigations of credible allegations of fraud.
31What is a “Good Cause Exception”? CMS regulations allow for discretion in cases where the best interest of law enforcement or the Medicaid program come into play as a result of an allegation of fraud.These are called “good cause exceptions”.
32Law Enforcement Good Cause There are valid law enforcement-related reasons to not suspend payments to providers, such as where:There are requests by law enforcement.Suspension of payments might give a “heads up” to a perpetrator, or expose undercover investigators, whistleblowers or confidential sources.
33Other Reasons for Good Cause Certain other Good Cause exceptions may be invoked, such as in cases where:Suspension is not in the best interest of the Medicaid program; and/orAccess to necessary items or services may be jeopardized.This situation involves working with other regulating agencies on access to care.
34More Reasons for Good Cause Examples could fall into either category depending on context, such as where:Other available remedies could more effectively or quickly protect Medicaid funds than would implementing (or continuing) a payment suspension; and/orThere is immediate enjoinment of potentially unlawful conduct.
35Suspension Process Notes The suspension process must be documented and maintained by TennCare.The 6402(h) suspension process will be coordinated with TennCare and the TBI Medicaid Fraud Control Unit.TennCare and MCOs may be required to work with providers to accommodate patients who need care.
36Credible Allegations of Fraud Questions?RACOverpaymentsCredible Allegations of Fraud
37Reporting Allegations To TennCare PHONEMAILGo to:or us at:Fraud HotlineFax:Bureau of TennCareOffice of Program Integrity310 Great Circle RoadNashville, TN 37243