Home Health & Hospice Week

Software glitch recoups $10 million from HHAs in error.

Medicare has moved quickly to correct its recent mistake in recouping home health agency outlier payments, but the headache’s not quite over.

Background: The claims system ran the quarterly reconciliation process on April 30, a HHH Medicare Administrative Contractor Palmetto GBA spokesperson tells Eli. "The utility did not reconcile the outliers properly, and resulted in erroneous provider overpayments," Palmetto notes on its website (see Eli’s HCW, Vol. XXII, No. 19). HHAs served by all MACs were affected by the $10 million in erroneous overpayment determinations, the rep says.

What happened: "Claims adjustments were triggered based on the incorrect total amounts, recouping outlier payments that were not actually over the cap," explains HHH MAC National Government Services in a message to providers. "Errors ... caused the data in the outlier totals for prior years for many HHAs to be corrupted."

The Centers for Medicare & Medicaid Services acted quickly, directing MACs to alleviate cash flow problems. MACs have "taken immediate action to repay incorrect recouped outlier amounts that were over $10,000, and providers should have seen the payments on Remittance Advices (RAs) dated May 29, 2013," HHH MAC CGS says on its website.

Request Your Payment If You Don’t Meet $10K Threshold

Example: A client of billing service Astrid Medical Services in Corpus Christi, Texas, has seen its $13,000 outlier recoupment returned, notes Lynn Olson. "However the payment didn’t show up in the Electronic Remittance Notification (ERN) system," Olson tells Eli. "It just appeared in their account."

MACs also have issued repayments upon request to HHAs whose takebacks were below the $10,000 threshold, Palmetto and NGS add.

Olson’s client with an $8,000 recoupment plans to submit such a request, he relates.

The process of fixing the outlier takebacks isn’t quite over, however. "Once the affected claims are corrected, Palmetto GBA will be creating a withholding amount for each affected provider equal to the lump-sum payment that was made," the MAC explains. "These withholdings will be similar to the process used to recoup accelerated payments." The other MACs will do the same.

"A utility that causes all claims associated with the May 2013 outlier reconciliation to be reprocessed also will be implemented in the near future," NGS elaborates. "The utility adjustments will restore outlier amounts and the withholding/netting function will recoup the lump sum payments."

Status: At press time, Palmetto was "in the validation phase in determining if the FISS changes were successful," the MAC spokesperson says.

Tip: With the number of transactions occurring around outlier payments, smart agencies will monitor affected claims to make sure the corrections actually result in accurate payment in this trouble area.

That may be harder than it sounds, though. "Keeping track of the amounts that have been withheld incorrectly or paid incorrectly due to outlier cap issues is quite complex," laments billing expert M. Aaron Little with BKD in Springfield, Mo. That may be more due to Medicare’s lack of a clear explanation for outlier calculation and reconciliation methodology than anything else.

Reminder: "Outlier payments are subject to a 10 percent per home health agency per calendar year cap," NGS explains. "The cap is enforced through comparing total outlier payments to total overall payments for each HHA on a per claim basis. To reflect late submission of claims, a quarterly reconciliation adjusts claims to pay any outliers due or to recover overpayments." The Centers for Medi-care & Medicaid Services limited outliers to 10 percent of HHA payments annually in 2010, after rampant abuse of the payment mechanism — particularly in the Miami area.