Home Health & Hospice Week

Expect this cash-flow draining tactic to spread across the country.

If you’re letting too many RAPs time out, you could pay the price in cash flow shortages.

HHH Medicare Administrative Contractor Palmetto GBA is cutting off payments for requests for anticipated payment (RAPs) when the agency has a too-high rate of auto-cancels for the RAPs. "Palmetto GBA is monitoring the number of RAPs that are auto-cancelled due to providers not filing a final claim," the MAC explains on its website. "In accordance with Medicare regulations, contractors have the authority to revoke a provider’s privilege to receive payment on the RAP. Therefore, providers identified with a high number of RAP auto-cancels due to no final claim will be notified that their RAPs will be set to pay at zero percent."

Don’t be surprised to see this tactic spread to the other HHH Medicare Administrative Con-tractors, industry veterans say.

Reminder: Providers have 120 days after the start of the episode or 60 days after the paid date of the RAP to submit the final claim, Palmetto explains. If the final claim is not submitted within the specified time, the RAP will auto-cancel and the provider must resubmit the RAP before submitting the final claim. "It is expected that instances where the RAP is auto-cancelled for no submission of a final claim should be minimal," Palmetto stresses.

What counts as "a high number of RAP auto-cancels"? Agencies that had 100 or more RAPs auto-canceled between January and April 2013, reports the National Association for Home Care & Hospice. Palmetto suppressed RAP payments for 298 home health agencies using this threshold, the trade group says in its member newsletter.

"Several agencies had more than 1,000 RAP cancellations and at least one had over 4,000," NAHC notes.

Next step: Agencies nearing the threshold aren’t off the hook. "Other providers that are identified to have RAPs auto-cancelled for no final claims that are below the acceptable threshold will be notified that their current billing practices are unacceptable and their RAPs are being monitored," Palmetto says. "If improvement is not noted within a reasonable amount of time, future RAPs may be set to pay at zero percent."

Palmetto is sending the warning letters to agencies that had 50 to 100 auto-canceled RAPs during the time period, NAHC says.

To get off the RAP no-pay list, agencies must submit a Corrective Action Plan and "demonstrate improvement in timely billing of final claims," Palmetto explains.

Submit Corrective Action Plan Yesterday

This could be "a huge problem for providers subject to the suppression," warns billing expert M. Aaron Little with BKD in Springfield, Mo.

"Agencies with suppressed RAP payments are expected to face severe financial hardships as they continue to deliver services and pay their personnel without any financial remuneration until episodes of care are completed," NAHC protests.

The problem of auto-canceled RAPs has grown since Medicare started requiring face-to-face documentation from physicians, Little notes. Slow physician signatures on plans of care and orders are also a problem.

Sometimes billing system or personnel problems contribute to a higher-than-usual RAP auto-cancel rate, NAHC offers.

Poor billing practices, delayed clinical documentation, and delayed pre-billing/compliance audits can also be the culprit, Little adds.

Do this: If you’re under Palmetto’s RAP payment embargo, determine whether you were correctly targeted by analyzing your Provider Statistical & Reimbursement (PS&R), NAHC advises. "If an error was made … call Palmetto GBA immediately to request that the RAP suppression be lifted."

If the auto-cancel rate checks out, "conduct an immediate in-depth assessment of potential causes," NAHC counsels. Then submit the corrective action plan as soon as possible.

What to include: The plan "should offer details of root causes and how they will be corrected," NAHC says. It should address issues such as "software enhancements, improved billing policies and practices; and allocation of additional resources to obtain physician signatures on certifications and plans of care."

Note: For a link to Palmetto’s notice of RAP suppression, e-mail editor Rebecca Johnson at rebeccaj@eliresearch.com with "RAP suppression" in the subject line.