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Medicare Compliance & Reimbursement

Home Health:

HHAs Preparing For M0175 Recoupments This Spring

Published on Fri Nov 07, 2003

Millions of dollars in takebacks based on patient hospital stays are on agencies' horizons. 

Despite the fact that the HHS Office of Inspector General hasn't even concluded its series of reports on M0175 inaccuracies, new claims edits based on the issue are poised to recoup millions of dollars from home health agencies.

The Centers for Medicare & Medicaid Services has instructed intermediaries to put in place new pre- and post-payment edits that will check whether HHAs correctly identify an inpatient hospital stay in the 14 days before home health admission, according to an Oct. 24 instruction from the agency (Transmittal No. 13).

OIG reports on the issue indicate "the Medicare program is vulnerable to make excess payments on HH PPS claims when certain OASIS assessment information is reported in error," CMS says in the transmittal.

Specifically, when agencies fail to report a hospital stay while at the same time reporting a skilled nursing facility or rehabilitation facility stay in M0175, it can bump the episode's health insurance prospective payment system (HIPPS) code up to a higher-paying "K" or "M" in the fourth position - a difference of about $200 and $600 per episode, respectively. If agencies record the SNF or rehab stay and the hospital stay, they don't see the increase.

While HHAs have a heck of a time obtaining information on prior hospitalizations, CMS and the intermediaries have the information at their disposal. Thus, three new types of edits will take effect for HHAs April 1:

  • Pre-payment RAPs. When requests for anticipated payment come in with a "K" or "M" in the HIPPS code, the claims payment system automatically will check the patient's claims history for an inpatient hospital stay within 14 days of admission to home care. If it finds one, the system will return the RAP to the provider, so the agency can correct and resubmit it.

  • Pre-payment final claims. When a final claim comes in with a "K" or "M" in the HIPPS code, the system again will check it against the patient's claims history for an inpatient stay. If one has shown up since the RAP check, the system automatically will adjust the claim to the lower-paying HIPPS code using an "L" or "J," respectively.

  • Post-payment claims. Because hospitals have up to 27 months to submit and be paid for their claims, CMS annually will analyze its National Claims History file to ferret out claims that were paid at the higher, no-hospital stay rate, but whose patients eventually did end up with a hospital stay recorded during the 14-day time period. The intermediaries then will recoup the money for those claims retroactively.

    An official with regional home health intermediary United Government Services expects most overpayments resulting from M0175 to be caught with the pre-pay final claims edit. HHAs tend to submit RAPs very quickly since reimbursement depends on them, and often the hospital claims won't be processed before the home health RAP goes through, the source presages.

    However, most hospital claims generally will be processed by the time the final claim rolls around 60 days later, the official predicts, so the discrepancy should be caught for the pre-pay edit of final claims. "I believe the bulk [of M0175 corrections] will be caught in the final claim," the source speculates.

    In those few instances where hospital claims aren't in by the time the home health final claim is, the annual post-pay review will catch the stragglers.

    The exception will be the first post-pay review, which will cover time periods when the pre-pay edits weren't in effect, the UGS official points out. That listing will have "huge numbers," the source predicts. The review, which is expected to come shortly after the edits' April 1 implementation date, apparently will catch all the claims that incorrectly recorded hospital stays since PPS began.

    The OIG said in its July report that in fiscal year 2001 alone, RHHI Associated Hospital Service of Maine made $1.9 million in M0175 overpayments. AHS is the smallest of the four RHHIs.

    Vague Notifications May Plague HHAs 

    "There must be some notification to the provider of the final adjustment," insists consultant John Gaynor with the Chicago office of Frost Ruttenberg & Rothblatt. When the claims payment system RTPs a RAP or adjusts a final claim based on an M0175 error, CMS says code N180 will appear on the remittance advice. The code says, "This item or service does not meet the criteria for the category under which it was billed," according to the transmittal.

    But that vague statement is not going to be very helpful in identifying the adjustment as related to M0175, the UGS staffer acknowledges. Due to HIPAA confidentiality rules, "it's not as clear as we would like," the RHHI official tells MLR.

    That means HHAs may have a hard time figuring out when their claims are being adjusted for their M0175 answers.

    HHAs complain that CMS is taking steps to correct M0175 data when it takes money away from agencies, but not when it adds money to their episodes. It's likely just as common to mark an inpatient stay and fail to mark a rehab or SNF stay as the opposite, notes consultant Rose Kimball with Med-Care Administrative Services in Dallas. But CMS makes no mention in the transmittal of correcting the rehab and SNF information.

    Editor's Note: The transmittal is at www.cms.gov/manuals/pm_trans/R13CP.pdf.

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