Home Health & Hospice Week

Demand bills and denied episodes could cause you big episode sequencing headaches.

Is the episode you’re trying to sequence for M0110 still considered “later” if the patient’s previous episodes were denied? Stay tuned for the answer, one intermediary says.

Home health agencies are expressing confusion over how to count episodes when a patient’s previous episodes were denied. A question-and-answer in regional home health intermediary Cahaba GBA’s March provider newsletter highlights the issue when the agency has sent demand bills for a patient fully expecting denials, then the patient becomes eligible for Medicare coverage.

Even when the agency submits a demand bill and the intermediary agrees the patient wasn’t eligible and denies the claim, the Common Working File creates episodes that show up in the query screens (HIQH/HIQA/ELGH), an HHA tells Cahaba in this month’s Newsline. If a clinician marks an episode as early because she knows it is the first Medicare-covered episode, the claims system could recode the claim as a later episode during processing based on the CWF episode history for the patient.

The result: If the patient has had two or more denied adjacent episodes, the system will count the current episode as later and pay the agency based on a higher HIPPS code accordingly.

Agencies might not even know that the patient’s previous episodes were denied if the patient is new to them, points out Abilene, TX-based consultant Bobby Dusek. And they’ll run into the same sequencing problems in the other direction--marking an episode as early when it’s really later--if a previous HHA serving the patient files its claims late.

Right now, agencies should stick with the CWF history to fill out the OASIS item. “The system will edit and adjust payment for episode timing based on the information posted to the CWF regardless of whether the adjacent episodes are paid or denied,” Cahaba explains.

But that may change. “Cahaba is seeking further clarification from the Centers for Medicare & Medicaid Services whether changes need to be made to the system logic to account for episodes resulting in a Medicare denial,” the RHHI says.

M0175 Takebacks Haunt HHAs’ M0110 Practices

Getting M0110 right from the start is important because it makes a major difference in payment. “A late episode will pay an average of 8 to10 percent more than an early episode,” Dusek figures.

HHAs don’t want a repeat of the M0175 fiasco, with CMS coming back years later to collect millions in overpayments that agencies had no way of knowing about. They also don’t want the feds to accuse them of unethically upcoding episodes for higher reimbursement when there was nothing they could do to prevent the higher payments.

But for now, there’s not much agencies can do about the claims system issues regarding M0110, says consultant Judy Adams with Charlotte, NC-based LarsonAllen.

HHAs are reduced to watching and waiting for a system update to fix the issue, notes reimbursement consultant Michelle Enger with Optimal Reimbursement Strategies in Clearwater, FL.

Prediction: And at least one reimbursement consultant doesn’t expect to see any changes anytime soon. “I think the clarification that [Cahaba] will receive from CMS is that there will be no changes,” forecasts Melinda Gaboury with Healthcare Provider Solutions in Nashville. “The patient received home care during that time whether it was denied or not.”

The good news is that the impact from this problem should be limited, expects consultant M. Aaron Little with BKD in Springfield, MO. The number of demand bills, and thus affected claims, appears relatively small.

Note: Cahaba’s article on the M0110 issue, along with an HHA’s detailed case scenario, is at https://www.cahabagba.com/part_a/education_and_outreach/newsletter/200803_rhhi.pdf on pp. 38-39.