RAC Update RAC Update GAHA: 2014 Health Care Law Update May 16, 2014 Tracy M. Field, M.S., J.D. Womble Carlyle Sandridge & Rice, LLP th Street, NW – Suite 2400, Atlanta, GA (404)

MEDICARE AUDITS Now What? Perspective: By challenging denials, CMS changed the rules! Compliance challenge: How assess accuracy? Business reasons for rebilling Part B 2 year backlog – and growing!

ALJ BACKLOG OMHA February 2014 Forum Office of Medicare Hearings and Appeals (OMHA) Forum: February 12, 2014 Backlog of 500,000 cases – and counting! Moratorium on docketing new appeals until workload addressed per ALJ o Hearings being scheduled

ALJ BACKLOG OMHA February 2014 Forum Backlog o Budget increase: 18+% (after sequester) o Statistical sampling? ‒ OMHA statistician ‒ Appropriate for fact-specific cases o Mediation/Alternative Dispute Resolution o New regulations

ALJ BACKLOG OMHA February 2014 Forum No longer need to submit medical records? Group cases – but individually file! Electronic filing? o Send files via tracking methods, and don’t expect an acknowledgment! o Miami pilot o 2 year development from award

ALJ BACKLOG OMHA February 2014 Forum Backlog o Increase in Escalation to DAB-MAC ‒ NO Hearing at DAB-MAC ‒ Access to federal court sooner – but… o OMHA stated testimony makes difference - yet o OMHA suggested may not want to request hearing?

ALJ BACKLOG OMHA February 2014 Forum Legal Considerations o Medicare Modernization Act (MMA) and BIPA deadlines not being met o For medical necessity cases, what standard of review applies? o Confusion on effective dates for local coverage determinations (LCDs) o Jimmo Case: Important for rehab, other uses?

ALJ BACKLOG OMHA February 2014 Forum Compliance Considerations o Part A/B Claims: 97% of appeals o Redetermination reversal rate to fully favorable: ‒ 30% per OMHA

ALJ BACKLOG OMHA February 2014 Forum For OMHA Outcomes of Cases Decided at ALJ 37% Fully Favorable – 4% Partially Favorable 30% Unfavorable 1% Remand 27% Dismissed Impact on Compliance activities….

RAC REPORT (March) 2014 For FYE 2012: o Increasing RAC Activity »Medicaid RACs »Data warehouse »Validation audits, education »“Maximize transparency” »Hearing Participation

RAC REPORT (March) 2014 For FYE 2012: o Collected $2.3 Billion in overpayments… o New initiatives to prevent provider appeals? »The 2 Midnight Rule »Subregulatory Guidance?

17 RAC Denial  Redetermination (MAC)  Qualified Independent Contractor (QIC)  Administrative Law Judge (ALJ)  Medicare Appeals Council (MAC)/Departmental Appeals Board (DAB)  Federal Court MAC REVIEWS

INITIAL REVIEWS Probe Audits MAC Audits: January 2014 MAC prepayment reviews: “probe and educate” Recovery Audits: Delayed until November 2014 – but the probe audits continue….

INITIAL REVIEWS Probe Audits Presumptions that Hospital Stays Less than 2 Midnights are Not Medically Necessary Presumption does not mean wrong!! Legal challenges to denials Strategy to avoid audits o Some opted for no one-day stays o Rebill under Part B?

MEDICARE APPEALS Other Considerations IPPS Proposed Rule: Payment for Short Stay Admissions: Payment under OPPS or IPPS? AHA Litigation: Challenges the 2 Midnight Rule; Part A/B Rebilling time limitations and physician certification of orders as payment condition

REFERENCES Per OMHA: Updates after 15 th of each month on adjudication timelines, processes OMHA Adjudication Manual Pending

QUESTIONS? Tracy M. Field, M.S., J.D. (404) Womble Carlyle Sandridge & Rice, LLP th Street, N.W. Suite 2400 Atlanta, Georgia 30363