1. Analyzing RAC and Government Audit Data: Gleaning Audit Intelligence to Reduce Denial Risk Donna J Brock, RHIT System HIM Audit & Privacy Coordinator Lee Memorial Health System Dawn Crump Vice President Audit Management Solutions HealthPort

2. Overview Recognize growing audit demands and the impact across revenue cycle and HIM teams. Compare and reset productivity benchmarks for timely submissions to auditors, denial reductions, appeal management and process/procedure adjustments to changing program parameters. Assess best practices in effective audit data clean-up, centralization and workflow improvement. Uncover audit data integrity issues, which are exacerbated when multiple audit-data sources are used, including home-grown systems.

3. Request for Health Information Drivers Increased scrutiny of health information Audits are on the rise More covered lives ACO Growth Health Information Exchange Health Care Reform Value Based Payment Legal Billing/ Quality Compliance/ Audits Commercial Plan Audits HEDIS Medicare Risk Adjustment Commercial Risk Adjustment Government Audits MAC RAC CERT OIG QIO

4. State and Federal Auditors U.S. Department of Health & Human Services CMS Centers for Medicare & Medicaid Services Medicaid MEDICAID RAC Medicaid Recovery Audit Contractor MIC Medicaid Integrity Contractor PERM Payment Error Rate Measurement Medicare MAC Medicare Administrative Contractor CERT Comprehensive Error Rate Testing RAC Recovery Audit Contractor QIO Quality Improvement Organization OIG Office of Inspector General ZPIC Zone Program Integrity Contractors U.S. Department of Justice

5. Recovery Audits vs Health Plan/Quality/Risk Audits No direct financial impact to the provider Large volume of requests No results letters or appeal process – only need to submit records Records are requested to be reviewed by the health plans to: –Compile quality data –Improve health management –Maximize health plan’s reimbursement from CMS Direct Financial impact to the facility Records must be submitted timely or payment is recouped Results are communicated to facility in various ways Money is recouped Denials can be appealed Records are reviewed to identify improper payments: –Services were medical necessary –Services were performed in the correct setting –Procedures were coded and billed correctly Health Plan Audits Recovery, Government and Commercial Audits

6. One Hospital System Journey of ROI Growth

7. What are the cost associated with improper payments? Medicare auditors are after all improper payments from all providers Medicare Modernization Act and Affordable Care Act have components to reduce fraud, waste, and abuse to preserve the Medicare Trust Fund Though some auditors may focus more on hospitals, the reviews can lead to physician and other provider reviews If the inpatient procedure was deemed medically unnecessary then so are corresponding Part B claims. CERT programs cites insufficient documentation for high percentage of errors http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/CERT/index.html?redirect=/CERT

9. Changes you need to know for 2016 New RAC & SOW QIOs auditing short stay/two midnight Managed Care RACs Comprehensive Care for Joint Replacement (CJR) 9

10. Analysis of Denials According to AHA RAC Trac Q3 2015 –Only 40% percent of all records requested last quarter were denied What should you be reviewing in your data? –Requests and denials Patient type Audit type Diagnosis What is your denial rate per volume requested? What is your appeal success rate? Compare your reasons for denials –Drill down to root causes

11. Dig into your Denials Analyze audit results and trends Review Medicare’s surgery and DRG lists AHA RACTrac Survey results Fact based decision making- *remember garbage in- garbage out Educate CDI professionals with key audit outcomes 11

12. Reading between the lines- Understanding the top reasons for audit denials Health care services or supplies needed to diagnose or treat an illness, injury, condition, disease, or its symptoms and that meet accepted standards of medicine. Does documentation support medical decision? Medically Necessary Specific documentation or documents required to support services billed per LCD or health plan requirements Insufficient Documentation Codes assigned per coding guidelines based on documentation provided in health information Incorrect Coding

13. What are auditors looking for? Complete documentation Diagnostic test results supporting medical decisions (admission, procedures, therapy) Previous treatment options Orders/ Appropriate Signatures Certification Statement Review records for completeness prior to submitting

14. CERT Error Rate Information WPS CERT “insufficient documentation continues to have a large impact on error rates for WPS Medicare and on a national level. Medical record documentation must support the services billed according to Medicare guidelines, the medical necessity of the services, and be legible in order?” http://www.wpsmedicare.com/j5macpartb /departments/cert/document-tips.shtml 14

15. Insufficient Documentation Claims are placed into this category when: Medical documentation submitted is inadequate to support payment for the services billed Evidence that allowed services were actually provided, were provided at the level billed, and/or were medically necessary Specific documentation element that is required as a condition of payment is missing, such as a physician signature on an order, or a form that is required to be completed in its entirety

16. How to know what to include? All requests are not the same! Create checklist for high volume/high dollar services Know your auditors and what they are auditing Use the following to develop your lists: LCD/NCD Requirements Know the LCD’s (local coverage determination) and NCD’s (national coverage determination)- **review annually for changes on high volume procedures CERT tips guidelines Medicare Billing Manuals Recovery Auditor websites

17. CERT examples CERT –Errors Medically Unnecessary Service or Treatment - 48% of total errors Insufficient Documentation - 25% of total errors Invasive Procedure Not Medically Necessary - 10% of total errors Service Incorrectly Coded - 7% of total errors 17 Ex: Missing 12-Lead Electrocardiogram (EKG) tracings to support the 12- Lead EKGs billed during the emergency room encounter and observation admission on billed dates of service. Submitted documentation includes the physician's testing orders and the physician's EKG interpretations. http://www.wpsmedicare.com/j5macparta/departments/cert/j5mac-2nd-qtr-2014-error-summary.shtml

18. Inpatient Rehab Example Inpatient Rehab Facility Patient Assessment instrument (IRF-PAI) –Must be submitted in a specific timeframe –Must be included in the health information When reviewing the record in the EMR for appeal, IRF-PAI was present and time stamped…

19. Example from CGI website Documentation needed for Chemotherapy drugs: 1. Administration Record including start and stop times 2. Signed and dated physician order for chemo 3. Infusion start and stop times 4. Drug order including dose and route Supplemental Medical Review Contractor (SMRC) project - Herceptin http://www.strategichs.com/wpcms/project-y2p25-herceptin-multiuse-vials/

20. Best Practice Tip View and approve prior to submission of health information Randomly audit compiled health information

22. Tips to Control costs Prevent denials and/or appeal denials Electronic delivery of documentation Audit/Appeal automation software Continuous quality improvement - physician, CDI and coding education Centralize audit process 22

23. What does your process look like?

24. Respond to denials timely Be prepared for denials Review record submitted against denial reason – EMRs can be tricky to review – Ensure health information included supports minimum LCD/NCD requirements Utilize discussion period when possible Establish an internal appeals team or a rapid denial review process with your external appeal partner Direct denials to appropriate personnel Monitor appeals process 24

25. CMS Overpayment Collection Timeline Adapted from http://www.cms.gov/Outreach-and-Education/Medicare- Learning-Network-MLN/MLNProducts/downloads/overpaymentbrochure508- 09.pdf

26. Following up on key audit trends Review demonstration project results CMS updates CERT information Scrutinize published RAC data Evaluate PEPPER reports 26

27. Top Inpatient Surgery 1.Arteriography and angiocardiography using contrast material: 2.4 million 2.Cardiac catheterizations: 1.0 million 3.Endoscopy of small intestine with or without biopsy: 1.1 million 4.Endoscopy of large intestine with or without biopsy: 499,000 5.Diagnostic ultrasound: 1.1 million 6.Balloon angioplasty of coronary artery or coronary atherectomy: 500,000 7.Hysterectomy: 498,000 8.Cesarean section:1.3 million 9.Reduction of fracture: 671,000 10.Insertion of coronary artery stent: 454,000 11.Coronary artery bypass graft: 395,000 12.Total knee replacement: 719,000 13.Total hip replacement: 332,000 http://www.cdc.gov/nchs/fastats/inpatient-surgery.htm 27

28. Service Types with Highest Improper Payments: Part A Inpatient Hospital PPS 2014 CERT Results

29. Improper Payment Rates- CERT 2014 Error Report Part A Inpatient Hospital PPS Services (MS-DRGs) Projected Improper Payments Improper payment rate Insufficient Documentati on Medical Necessity Major Joint Replacement Or Reattachment Of Lower Extremity (469, 470)$345,709,6505.90%68.40%21.20% Spinal Fusion Except Cervical (459, 460)$200,530,71910.30%46.60%37.60% WPS CERT Denial : Procedure, total hip replacement, and thus inpatient admission, not reasonable and necessary: little information about prior conservative treatment; no specific information about X-rays.

30. Service Types with Highest Improper Payments: Part A Excluding Inpatient Hospital PPS 2014 CERT Results

31. Home Health Documentation Required Documentation: Physician certification/recertification of “confined to home” status and the need for home health services Why confined to home in narrative? Why intermittent skilled nursing services are needed? PT, OT, SLP services must be reasonable and necessary to the restoration or maintenance of function Face-to-face encounter documentation Therapy notes Comprehensive assessment of the home care recipient

32. Home Health – Insufficient Documentation Denial The devil is in the details: ask the why’s? A home health agency submitted a claim for home PT, OT and home health aide services. Documentation was submitted Physician’s signed plan of care Face-to-face encounter documents Comprehensive assessment of the beneficiary Copies of all therapy and home health aide notes The submitted face-to-face encounter documentation stated only “unsteady gait” and “taxing effort.” Acceptable Narrative: Ambulates limited distance of 125’ with assistance of a walker due to acute stroke; Frequent seizure activity, requires supervision/assistance of another person

33. How do you compare? Appeals AHA RAC reports providers are appealing 47% of all denials  Settlement?  Utilize Discussion option for RAC process  50% of denials reversed by RAC through discussion per AHA RAC Trac Survey results 53% of claims are not appealed after a RAC denial (AHA RAC TRAC) What are the reasons you didn’t appeal? No IP order Documentation doesn’t support the necessity Not enough staff to manage appeals Interqual validation? Compliance impact document: Reasons for not appealing Action plans for un-appealed RAC denials Education plans with key stakeholders Re-audit as needed 33

34. Other Questions to consider on Appeals Do you separate out automated vs complex denials? Cost of appeal vs dollars at risk? Do you utilize Internal vs External appeal partner? –Do you capture administrative cost of appeals? Productivity Quality vs Quantity What is your overturn /success rate on your appeals? How many dollars are held in your appeals?

35. Appeal /Dollars at risk example –Once a record is requested for an external audit the expectation is that the entire payment for that claim is at risk until otherwise communicated. 35 Volume of records requested150 Avg value of medical records requested or $$ at risk$5,458.00 $$ in Medicare Payments$818,700.00 Technical denial error rate (example only)0.5% Volume of Techinal Denials0.75 Cost of Technical Denials$4,093.50 % Denied45% Total Claims Denied67.5 Appeal Percentage47%57% Total Appealed31.72538 Overturn rate62% Appeal Success Rate # of claims19.669523.8545 Avg $ retained$107,356$130,198

36. Appeal vs Rebill Data analysis can help determine what is the best course for rebill or appeal –58% of original Part A recouped when Part B rebilled *(AHA RAC TRAC 3 rd QTR 2015) Points to consider –Overturn rate on appeal –Overturn rate by DRG or Procedure –$ associated with improper payment –Expected part B reimbursement –Refunds due to secondary payors

37. Lee Memorial Health System, Fort Myers, FL 1461 Acute Care beds –4 campuses (3 provider numbers) 60 bed Rehab Hospital 300 Primary and Specialty Care Physicians 112 Skilled Nursing Facility Home Health Services 2 RACs (Soon to be 3 with Home Health) 3 MACs 18,563 AudaPro RAC accounts

38. Challenges Difficulty tracking and managing influx of audits across all areas $ 48 Million at risk in audits $ 12 Million at risk in appeals At audit peak was receiving ~ 700 ADR’s every 45 days

39. What we currently track? Government audits for: –Medical Necessity –DRG Facilities: –Hospital –Physician clinics –Home health –SNF –IP Rehab –OP Rehab Beginning to monitor commercial reviews

40. How should you be spending your RAC “slow down”? Evaluate your audit management process and team for RAC readiness and efficiencies Monitor other payor audits – commercial plan audits have been on a steady rise Inspect the integrity of your audit data and analyze for clinical improvement opportunities Review claims still in appeal and claims that were not appealed –Develop an educational plan around both –Remember if you did not appeal it and there are trends you may have a compliance issue around improperly billed claims

41. Appeal Everything? Missing documentation on diagnosis or medical necessity Lack of order Discussion -DRG changes Rebill –Weak case with little documentation –Evaluate reimbursement for return on investment

42. Appeals Our Process and Challenges –Cost of appeal vs dollars at risk –Review of DRG/Coding accuracy –Overturn/success rate –Appeal vs Rebill

43. Appeals – Use of Teams Appeal Decisions are Collaborative: –Care Management Department –Analyzes Medical Necessity Denials before Appeals –Central Business Office (CBO) –Involved in Pre-Payment Denials and Part B Re-Bills –Audit Department –Centralized Audit Location –DRG Denials –Clinical Documentation (CDI) –Involved in Level 3 (ALJ) Appeal Decisions Claims Denied Discussion Communicate Statuses and Results of Appeal Claims

44. Audit Department Flow Chart for Appeals

45. Lesson learned Challenge the decision Technical Denials –Discussion or Appeal with Proof of Receipt ALJ Appeals –Current Minimum of 28 Months Out –Are you going to participate in the new appeal demonstration Inpatient Only –Appealing to Prove on CMS IP Only Lists

46. How we stay informed and educated Weekly Webinar –Rac Monitor and vendor/partner education Government Agency Websites PowerPoint Presentations Monthly Audit Meetings LEAN with Department Huddles Seminars and Continuing Education American Hospital Association –Quarterly Rac Trac

47. Duplication of efforts Monitor for compliance and deny when outside limits Duplicate requests –Same name –Same Dates of Service –Same DRG

48. Financial Impact Monthly/Quarterly Reports –$$ at Risk at All Levels of Appeals –Shared with All Required Stakeholders –Examples: –622 Claims at ALJ Older than 12 Months –Dollars at Risk = $4M –55 Claims at ALJ Older than 28 Months –Dollars at Risk = Over $380,000

49. Have a good process Create standard P&P’s Information is only as good as the data that is entered Lower financial risks Quicker turnaround time in appeals with more favorable results –Quicker record submission= quicker reimbursement of prepayment audit claims More accurate reporting

50. Learning from Denials and appeals Appeal Training Sessions –Coders –Top DRG denials –Root cause analysis Communication loop with: –Physicians –CDI –Other System Facilities

51. Summary Denials / Appeals can be costly – learn from denials and appeals Track all denials and appeals Develop a process or initiatives around denials Communicate / Educate key stakeholders on denials and appeal outcomes

52. Best practice tips Identify your top denial reasons Create checklist/ templates to educate clinicians in understanding specific required documentation Identify additional documentation needed for different service lines and specialties Educate clinicians to answer the why’s Make sure all signatures are present and legible and meet requirements Ensure EMR print templates are inclusive of all key information and review annually Review records for completeness/specific documentation needs prior to submitting

53. Questions Dawn Crump - Dawn.Crump@HealthPort.comDawn.Crump@HealthPort.com Donna Brock - donna.brock@leememorial.orgdonna.brock@leememorial.org