Home Health & Hospice Week

Be prepared to back up your code usage in medical review.

You’ll be at risk of losing your rightful reimbursement under PDGM if you count on the Medicare claims system to automatically adjust your claims for institutional stays.

Why it matters: Under the new Patient-Driven Groupings Model taking effect Jan. 1, 30-day periods will receive a big payment increase when they are deemed “institutional” due to certain facility stays (see box, p. 231). For example, based on 2018 data, Missouri home health agency episodes saw a nearly $660 increase for institutional versus community episodes, on average, relates billing expert M. Aaron Little with BKD in Springfield, Missouri.

Another example: When comparing non- wage-adjusted payments for late Muskuloskeletal Rehab periods, an institutional period pays $803 more, on average, than a community period, indicates data drawn from an educational presentation by Dave Macke, director of reimbursement services with VonLehman & Co. in Ft. Wright, Kentucky.

The other case mix factors are timing (early or late), clinical grouping based on the claim’s principal diagnosis code, functional impairment level based on eight OASIS items, and comorbidity level based on the claim’s secondary diagnoses.

A claim can receive the institutional upgrade in two different ways.

Method #1: When submitting the claim, the HHA can include two occurrence codes that indicate an inpatient stay that triggers the institu­tional payment increase. Occurrence code 61 will indicate an acute care hospital discharge within 14 days prior to the “From” date of any HH claim, while OC 62 will indicate a skilled nursing facility, inpatient rehabilitation facility, long-term care hospital, or inpatient psychiatric facility discharge in that timeframe.

Don’t forget, OC 62 adds payment only to an “early” episode. “Late” episodes see the pay bump only for OC 61 indicating an ACH stay.

Method #2: You can submit a claim without those occurrence codes and still achieve the payment increase. “When the inpatient claim is processed later, Medicare systems will automatically adjust the paid HH claim and pay it using an institutional payment group instead” — upcoding the claim to institutional — “when the relevant facility submits its claim to Medicare,” a Centers for Medicare & Medicaid Services speaker indicated in an Aug. 21 education call, “Home Health Patient-Driven Groupings Model: Operational Issues.”

The problem is that with the latter method, you have to depend on the facility to submit the Medicare claim within timely filing guidelines. Your payment bump could be delayed up to 12 months, if the claim arrives at all.

Good news: Stays at facilities that don’t submit claims to Medicare — such as Veterans Administration hospitals — can still count by using method #1, the CMS official said in the call. When agencies submit claims using OC 61 or 62, the claims system doesn’t require verification of the stay, he confirmed in response to a caller question.

Furthermore, CMS has “no current plan to create any automated lookback” to make sure an institutional claim eventually comes in, the CMS source explained in response to a provider question.

“Medicare systems will not automatically downcode all HH claims after the timely filing period elapses,” a CMS spokesperson confirms to Eli.

On one hand: The uncertainties of method #2 make it seem that submitting OCs for inpatient stays is a good way to secure rightful reimbursement. “At this early stage, it would seem like a good idea to always use the occurrence codes to report the inpatient stays, so as not to take a chance on the inpatient providers not getting their claims billed timely or in the event the inpatient providers find out the stays were covered by a payer primary over original Medicare,” Little tells Eli.

On the other hand: Always submitting the codes when patients have inpatient stays can be “a double-edged sword, because if the occurrence codes are used incorrectly then it would cause the HH claims to be overpaid,” Little points out.

For example, the patient might tell you that they have spent the night in a local hospital, which you mark as an ACH stay. But in reality, they may have been kept for an observational stay, which doesn’t count toward the institutional designation.

Most “seventy-year-old Medicare patients don’t know the difference” between an inpatient stay and observation stay, Macke tells Eli. That could lead you to mark a claim as institutional when it’s not, and the error will never get corrected by the Medicare system.

Similar confusion can arise over patients in hospital swing beds (see box, p. 231).

Watch out: If a claim comes up for medical review, it could be adjusted for such mistakes, the CMS staffer cautioned in the call. “If documen­tation of an institutional discharge cannot be found in the medical record or in claims history during a post-payment review, the claim could be recoded at that point,” the CMS spokesperson emphasizes.

And if reviewers suspect the problem is widespread and/or intentional, you could find yourself subject to extensive medical review, referred for fraud and abuse scrutiny, and more, experts worry.

Of course, strong documentation can counteract those types of problems. In the 2019 home health final payment rule implementing PDGM, CMS noted that “Regarding the usage of discharge summaries as evidence of a prior institu­tional stay, such summaries may be considered in the assessment of the appropriateness of the usage of an occurrence code indicating admission to HH from an institutional setting and determinations will be made based upon the evidence gathered.”

Note: A recording and transcript of the call should be available in about two weeks at go.cms.gov/npc — scroll down to the Aug. 21 listing.