Healthcare Business News

Coding scrutiny sought

But SNFs say federal approach is misguided

By Paul Barr
Posted: November 17, 2012 - 12:01 am ET

"Our providers are not trying to do anything fraudulent."

—Dianne De La Mare, American Health Care Association

Representatives for skilled-nursing facilities are displeased with a suggestion that CMS contractors take a closer look at therapy reimbursement following an HHS inspector general's office report that concluded there were $1.5 billion in inappropriate Medicare payments to the facilities in 2009.

In the report, the inspector general's office found that a majority of the $1.5 billion in inappropriate Medicare payments were related to coding for higher and more costly levels of care than what HHS investigators believed to be necessary, which is known as upcoding, and suggested that the CMS' Medicare administrative contractors increase and expand skilled-nursing facility claims reviews, one of six recommendations. Medicare paid $32.2 billion for skilled-nursing services in fiscal 2012, according to the report.

Representatives of the American Health Care Association, a nursing home group, disagreed with many of the conclusions in the report, as well as the federal government's overall approach when using third-party contractors to oversee skilled-nursing facility therapy payments, particularly in those identified as being upcoded.

“We don't believe the government's approach with respect to high-intensity therapy is correct or substantiated by facts,” said Dianne De La Mare, vice president of legal affairs for the AHCA.

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The inspector general's report also recommends that the CMS use its fraud prevention system to identify skilled-nursing facilities that are billing for higher-paying resource utilization groups, a classification used to bill for therapy; monitor compliance with new therapy assessments; change the current method for determining how much therapy is needed to ensure appropriate payments; improve the accuracy of reporting by skilled-nursing facilities; and follow up with facilities that billed in error, according to the report.

The CMS concurred with the recommendations and said it would provide a technical assistance letter to Medicare administrative contractors along with the report and its recommendations.

Should the MACs agree to expand claim reviews as recommended, the CMS will ask them to “more closely scrutinize” data reports from skilled-nursing facilities, called minimum data sets, and to identify facilities and chains with reoccurring issues and focus the reviews on them.

This latest report follows a similar examination by the inspector general's office released in December 2010, which found that skilled-nursing facility therapy coding was shifting to higher-paying levels even though the patient population wasn't changing. Still to come is a report that will assess the quality of care that skilled-nursing facilities provided, according to the inspector general's office.

In addition to highlighting the point that the CMS has made changes since 2009 designed to improve the way therapy payments are allocated to skilled-nursing facilities, AHCA officials say the government's apparent targeting of the facilities as a major source of inappropriate coding or fraud is misguided.

There have been regulatory and marketplace changes that are driving rehabilitation and long-term acute-care hospital patients into skilled-nursing facilities, meaning the patients are then more likely to need more complicated therapy, De La Mare said.

“Now that we're getting the higher-acuity patients … we can provide therapy at a lower cost,” she said.

The AHCA has complained that outside contractors charged with varying degrees of oversight power are overwhelming skilled-nursing facilities with conflicting or duplicative records requests, creating excessive reporting burdens.

At the same time, the standards being used, if they exist, for determining what makes an improper billing code are not being made available to the skilled-nursing industry, making it more difficult for the facilities to code as the CMS wishes, De La Mare said.

“Our providers are not trying to do anything fraudulent,” she said. “They're not trying to upcode. They're trying to do what's best for the patient.”

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