Medicare Compliance & Reimbursement

‘Corrective actions’ factor in 2019 improper payment rate reductions.

You may find Medicare’s paperwork rollbacks encouraging as the feds continue to streamline the claims process for overburdened providers. However, don’t be lulled into a false sense of security by these administrative simplifications — accurate notes still matter, claims audits aren’t going away, and repayment is expected. 

Context: On Dec. 19, the Centers for Medicare & Medicaid Services (CMS) released its “2019 Medicare Fee-for-Service Supplemental Improper Payment Data” as part of its Comprehensive Error Rate Testing (CERT) program. The report looks at the biggest errors among Medicare claims and covers the causes of the improperly paid charges.

Here’s a breakdown of the overall improper payment rate impacts by each part of Medicare:

• Part A with Hospital IPPS: The government found Medicare Part A with hospital inpatient prospective payment system (IPPS) claims added 15.5 percent to the total improper payment rate.
• Part A without Hospital IPPS: A whopping 46.1 percent of Medicare Part A excluding hospital IPPS claims were part of the overall error rate.
• Part B: The CERT data highlights Medicare Part B’s portion in the improper payment rate at 29.9 percent of the overall amount.
• DMEPOS: According to CMS, Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) accounted for 8.5 percent of the total error rate.

Good news: CMS’ efforts to curtail incorrect coding are working. Since 2014 the improper payment rate has steadily declined, and last year’s numbers went down significantly. The improper payment rate in 2019 was 7.3 percent, down from 8.12 in 2018, while improper payment amounts decreased from $31.6 billion in 2018 to $28.9 billion last year.

The reduced rates are a boon for everyone, according to agency guidance. “Every dollar spent inappropriately is one that should have been used to benefit patients,” explains CMS administrator Seema Verma in a release. The agency “is pulling every lever at its disposal to safeguard precious resources and direct them to those who truly need them — both today and in the future.”

CMS Targets 3 Areas to Reduce Improper Payments

There are problem zones that add substantially to the improper payment rate annually, according to CMS. By nipping those issues in the bud with “corrective actions,” Medicare cut down improper payments by billions, suggests the agency in a release. 

1. Home health: For example, CMS credits the Targeted Probe & Educate (TPE) program as being a major factor in reducing home health improper payments by $5.32 billion between 2016 and 2019.

2. Part B services: “Clarification and simplification of documentation requirements for billing Medicare under our Patients Over Paperwork initiative” helped cut Part B services like office visits and lab work by $1.82 billion last year, CMS says.

3. DMEPOS: Though the agency doesn’t go into detail, it implies that various “corrective actions” in the DMEPOS space contributed to the $1.29 billion decrease between 2016 and 2019, a release notes.

Insufficient Documentation Remains Primary Issue

According to the CERT report, insufficient documentation is the chief cause leading to improper payments across the Medicare spectrum. “Root causes” varied, but both Parts’ A excluding IPPS and B suffered from multiple universal errors as the top cause at 40.5 percent and 31.3 percent of improper payments respectively (see Figures’ 8 and 9 in the CERT data).

On the other hand, the samples highlighted DMEPOS’s problem with medical records’ accuracy. Missing or inadequate records accounted for 62.7 percent of the DMEPOS improper payment rate, notes the report.

Here’s How CERT Data Impacts Your Practice

Whether your notes, coding, and compliance policies are spot on or your Medicare claims could use a little help, it is a good idea to review the annual Comprehensive Error Rate Testing (CERT) data.

Why? The Centers for Medicare & Medicaid Services (CMS) uses the information garnered from the CERT program in three different ways. First, it utilizes providers’ data to “protect the Medicare Trust Fund by identifying errors and assessing error rates, at both the national and regional levels,” indicates Part B Medicare Administrative Contractor (MAC) CGS Medicare in its CERT guidance.

Second, the government tracks error trends amongst certain provider types, codes, and services through the CERT program. These findings help CMS pinpoint problem areas that are perennially an issue and ratchet up the improper payment rate, costing taxpayers billions. The agency then uses this valuable information to rein in outliers, rectify issues, and promote program integrity, CGS suggests.

Lastly, CMS uses the information garnered from the report to measure how MACs are doing. The CERT data helps to determine regional programming and education, including tools like the Targeted Probe & Educate (TPE) program and Comparative Billing Reports (CBRs) in a jurisdiction.  

If you’ve been burned by documentation blowups in the past, 2020 is a great time to realign your protocols with those of Medicare and put medical records accuracy at the top of your to-do list. You should always pay attention to the medical documentation, so you can avoid making errors in your own practice, instructs Christina Neighbors, MA, CPC, CCC, coding quality auditor for Conifer Health Solutions, Coding Quality & Education Department, and member of AAPC’s Certified Cardiology Coder steering committee.

Look at some examples of what CMS considers “insufficient documentation” and check for these types of inaccuracies in your claims audits:

• Orders that are not signed by a valid physician or are missing other required elements
• Missing documentation to support the services were provided
• Documentation that doesn’t support the code reported
• No hospital record or a missing medical report
• A lack of proper authentication in the record
• Various signature issues including things like a missing or illegible signature, no signature logs, or an electronic signature with no policy or protocol attached

Review more of Medicare’s medical record documentation requirements at  www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/CERTMedRecDoc-FactSheet-ICN909160.pdf.

Tip: Keep in mind that just because documentation supports the level of service billed, the coder or biller must be sure that it’s medically necessary to report that level of service, says Gina Vanderwall, OCS, CPC, CPPM, financial counselor with Finger Lakes Ophthalmology of Canandaigua, New York. “One can have excellent documentation that supports a higher level of service, but medical necessity must be taken into consideration as well. You can’t always bill the higher level of service simply because your documentation has all the bullet points checked,” she adds.

California and Texas Bump Up the Overall Improper Payment Rate

Among the unadjusted impact stats for Medicare Parts’ A and B with home health and hospice included, Texas ranked first with an error rate of 9.7 percent while California was second at 9.1 percent. Florida rounded out the top three at 6.8 percent, and Ohio and New York tied for fourth at a 4.6 percent error rate overall.

Resource: Review the CERT report at  www.cms.gov/files/document/2019-medicare-fee-service-supplemental-improper-payment-data.pdf.