Home Health & Hospice Week

From losing pay to pouring in more resources, the cons far outweigh the pros.

Home health agencies have hated the idea of no-pay requests for anticipated payment since the CMS proposed them in 2018, and 2021 has shown they have good reason.

Background: In its 2019 final payment rule issued in late 2018, the Centers for Medicare & Medicaid Services finalized no-pay RAPs for newly enrolled providers effective 2020. In its 2020 final rule issued in late 2019, CMS reduced RAP payments to 20 percent of the full episode amount in 2020 and switched all agencies to no-pay RAPs in 2021.

The change was met with vociferous protest from the industry, but CMS overruled its concerns. The agency insisted that 30-day billing periods made upfront cash payments unnecessary and that widespread RAP fraud was costing Medicare big (see HCW by AAPC, Vol. XXVIII, No. 39-40).

As expected by the home health industry, “the transition from RAPs to no-pay RAPs has been a disaster,” emphasizes Nick Seabrook with BlackTree Healthcare Consulting in King of Prussia, Pennsylvania. It’s the opposite of the relatively smooth transition to the Patient-Driven Groupings Model this year, Seabrook observes.

“CMS really did not do providers any favors with this transition plan,” judges reimbursement expert M. Aaron Little with BKD in Springfield, Missouri.

Here are some of the top problems HHAs have seen since no-pay RAPs began Jan. 1:

• The five-day deadline and financial penalties. HHAs now have five days from the start of care to submit a RAP. If they don’t, they incur a 1/30 financial penalty for every day they are late with a billing period’s RAP.

Agencies that have failed to fully adapt to the new, lesser requirements for RAPs are having a tough time hitting the five-day deadline, relates consultant J’non Griffin with Home Health Solutions in Carbon Hill, Alabama. For example, HHAs may now submit RAPs based on verbal orders and can use a “dummy” placeholder HIPPS code instead of the real thing.

Even under the new requirements, “the challenge of getting admission documents processed to generate the RAP poses some operational challenges,” notes Joe Osentoski with Gateway Home Health Coding & Consulting in Michigan.

The shift to the five-day deadline was a major operational change for some providers. They “were used to sending the billing weeks or months later,” relates Tim Olson with billing company Astrid Medical Services in Corpus Christi, Texas. “Even some of those who are usually more timely have had to rethink and rearrange their processes to get the RAP information completed as quickly as possible,” and that has been a challenge, Olson says.

When LUPAs get triggered, the problem can be even worse (see box, p. 83).

“The financial penalty is the clearest downside since it has a concrete effect,” Osentoski judges. “The deadline is causing the most angst.”

• Cash flow slowdown. Even when no-pay RAPs work as intended, they are still resulting in significantly reduced cash flow, says Lynn Labarta, CEO of Imark Billing in Miami. “The RAPs are now paying zero,” Labarta highlights. “Agencies, especially smaller agencies, counted on the 20 percent upfront payment to help cover their payrolls.”

The result: “They are down 20 percent of upfront cash,” Labarta tells AAPC. “This is a strain.”

• Medicare claims system errors. Every week seems to bring a new RAP payment error coming to light (see story, p. 84). “There have been numerous problems with claims processing, as evidenced by the claims processing issue logs published by all three MACs,” Little stresses. Every error, even if the HHH Medicare Administrative Contractors go back and correct it, is “yet another hit to providers’ cash flow and claims processing headaches,” he says.
• HHA software errors. The processing glitches aren’t all on Medicare’s side. “Some of the software [programs] were having challenges in generating the second RAPs,” Labarta offers.

Another example: “Some softwares have not adapted their processes either, so the OASIS has to be completely reviewed before the RAP will drop,” Griffin recounts. That “costs the agency time and money, because likely it won’t be accurate and complete, submitted, and accepted within the 5 days.”