pac audit basics laurie laxton final - aamas.org · a final score was calculated which tied to a...

5/18/2020

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AUDITING BASICS IN POST-ACUTE CARE SETTINGS

Laurie Laxton, RN, BSN, CCFA, RAC-CT, IP-BC

[email protected]

DISCLAIMER

• Neither I nor AAMAS endorses or has a financial interest with any companies

referenced in the presentation.

• Examples shown are not representative of the best quality or most widely used. They

are simply examples readily found during internet research and/or personal

experience.

OBJECTIVES/AGENDA

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POST-ACUTE CARE SPECTRUM

LONG-TERM CARE HOSPITALS (LTCH)

INPATIENT REHABILITATION FACILITIES (IRF)

SKILLED NURSING FACILITIES (SNF)

HOME HEALTH AGENCIES (HHA)

HOW ARE THEY PAID

SKILLED NURSING FACILITIES

• Medicare A

• Medicare Advantage

• Medicaid

• Private payers

HOME HEALTH AGENCIES

SKILLED NURSING FACILITY HOME HEALTH AGENCY

Patient Driven Payment Model Patient Driven Groupings Model

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AUDIT EXAMPLES

• PAST and FUTURE

• Tools used

• Private firm and RAC audit focuses

POST-ACUTE CARE SPECTRUM

LONG-TERM CARE HOSPITALS (LTCH)

INPATIENT REHABILITATION FACILITIES (IRF)

SKILLED NURSING FACILITIES (SNF)

HOME HEALTH AGENCIES (HHA)

SKILLED NURSING FACILITY

• Freestanding vs “swing bed” in-patient

rehabilitation center

• Staffed with trained medical professionals

including MDs, RNs, CNAs, PT/OT, SLP,

Audiologists, Social Services directors, Dietitians,

and more

• “Patients”-short term vs “Residents”-long term

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CMS REQUIREMENTS OF PARTICIPATION

https://www.federalregister.gov/documents/2016/10/04/2016-23503/medicare-and-medicaid-programs-reform-of-requirements-for-long-term-care-facilities

MEDICARE COVERAGE

A Hospital, SNF, Home Health Care, Hospice Care

B Doctor and other HC providers, Outpatient care, DME, Home Health Care, many preventative services

CMedicare Advantage (MA) Plan

Covers Part A, Part B, and often Part D drugs

D Prescription Drug Benefit

MEDICARE PART A

COVERAGE IN A

SKILLED NURSING FACILITY

Medicare Benefit Policy Manual Chapter 8

Contains pertinent rules of coverage

Benefit Period 100 days of coverage

Qualifying stay3 consecutive night hospital stay within 30 days of admission to SNF

MD order for skilled nursing care or rehab services

Certain rules around MD certifications and recertifications

https://med.noridianmedicare.com/web/jea/provider-types/snf/snf-certification-and-recertification-for-medical-review

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EXAMPLES OF WHAT IT COVERS

• Semi-Private room

• Meals

• Skilled nursing care

• Physical and Occupational Therapy

• Speech-language pathology services

• Medical social services

• Medications

• Medical supplies and equipment used in the facility

• Ambulance transportation

• Dietary counseling

SNF MEDICARE A COVERAGE-PER BENEFIT PERIOD

• Days 1-20; $0 for each benefit period• Days 21-100; $176 coinsurance per day of each benefit period• Days 101 and beyond: all costs

Patient costs:

Short stay vs. Long Stay

Benefit Period resets after 60 consecutive days out of a SNF and not admitted to an acute

care hospital

https://www.medicare.gov/coverage/skilled-nursing-facility-snf-care

MEDICARE VS MANAGED CARE

Medicare payments made through the Skilled Nursing Facility Prospective

Payment System

Managed Care or Medicare Advantage plans

They make their own determinations via contracts

with facilities on how they will pay the SNF

Level of Care

contracts

RUG/PDPM contracts

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SKILLED NURSING FACILITY PROSPECTIVE PAYMENT SYSTEM

(MEDICARE A)

• RUGs-Resource Utilization Groups used to be the way Medicare A

payments were calculated

• October 1, 2019 SNFs were introduced to the Patient Driven Payment

Model

RUG VS PDPM

• AFTER treatment is rendered

• Two case-mix adjusted components• Therapy

• PT+OT+SLP minutes provided per week

• Nursing

• Case-mix index of various items

• Conditions needing high or low complexity of care (Septicemia, Diabetes, Parkinson’s)

• Skilled nursing needs (tube/IV feedings, wound care, oxygen, chemotherapy)

• Depression score

• Overall physical functioning and need for assistance was scored

• BEFORE treatment is rendered

• Focuses on Clinical Diagnosis to drive resource payment

• Five case-mix adjusted components

• Physical Therapy (PT)

• Occupational Therapy (OT)

• Speech/Language Pathology (SLP)

• Nursing

• Non-Therapy Ancillary

• Includes a Variable Per-Diem (VPD) adjustment over the course of the stay

• Completely takes amount of therapy minutes out of the equation

SNF STATE MEDICAID PAYMENT METHODS

• Resource Utilization Groups (RUGs)

• Case Mix states

• Flat Rate states

https://www.nic.org/blog/medicaid-reimbursement-rates-draw-attention/

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STATE MEDICAID

• Most states are still using the RUG payment method but CMS has announced that they

will not support those data elements in the Minimum Data Set (MDS) after 2021

• States who use the MDS to calculate payment will then be forced to move to the

Patient Driven Payment Model

SPADES INITIATIVE

• Part of the Improving Medicare Post-Acute

Transformation Act of 2014 (IMPACT Act)

• 5 focus areas:

1. Cognitive function and mental status

2. Special services, treatments, and interventions

3. Medical conditions and comorbidities

4. Impairments

5. Other categories

IRF-PAI

LTCH-CARE

OASIS

SNF MINIMUM DATA SET MDS ASSESSMENT

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EXAMPLES OF MDS

SECTION GG

SECTION O

OBRA AND PPS SCHEDULES

OBRA PPS- OLD PPS-NEW 10/1/19

Entry record 5 day 5-day/admission

Admission (comprehensive) 14 day Discharge from Medicare A benefits (at 100 days)

Quarterly 30 day Interim Payment Assessment (IPA)-optional

Annual (comprehensive 60 day

Significant Change in Status 90 day

Change in Therapy

End of Therapy

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LOOKBACK PERIOD

• Assessment

reference date

(ARD)

• 7-14 days to transmit

to government

MANAGED CARE CONTRACTSPAYMENTS TO SKILLED NURSING FACILITIES

• Many are still using the RUG payment method but CMS has announced

that they will not support those data elements in the Minimum Data Set

(MDS) after 2021

• Those who use the MDS to calculate payment will then be forced to

move to the Patient Driven Payment Model

• Some pay by Level of care

EXAMPLE OF MANAGED CARE/LEVEL OF CARE CONTRACT

• Level 1 usually contains basic care, ostomy care, medications, labs, and therapy under 2 hours ($250/day)

• Level 2 often >2 hours therapy, IV injections, wound care, higher cost medications, i.e. Lovenox, and isolation ($350/day)

• Level 3 often contains over 2.5 hours of therapy, high cost medications such as Arixtra, central line care, ($450/day)

• Level 4 and 5 often include such care as respirators, stage IV pressure ulcer care, and in-house dialysis (over $500/day)

Consists of

1-5 Levels

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HOW MDS IS USED TO CALCULATE A RUG SCORE/ HIPPS CODE

1. Total therapy minutes for a week were added up

2. A score was given following a complicated algorithm based on the answers put in the

section pertaining to Activities of Daily Living

3. Additional consideration was given to:

• Residents with pressure ulcers and other skin conditions requiring nursing treatments

• Residents with certain diagnoses, such as, Parkinson’s, MS, Cerebral palsy, burns, pneumonia

• Residents requiring help with feeding tubes or dialysis treatments

• Residents requiring help with IV medications, Chemotherapy, oxygen,

• Residents with behavioral and cognitive issues

4. A final score was calculated which tied to a HIPPS code with a per diem payment amount

HOW AN MDS IS USED TO CALCULATE A PDPM HIPPS CODE

1ST A PRIMARY DIAGNOSIS IS CAPTURED

• ICD-10 codes have never

been as important as they

are now in Skilled Nursing

Facilities

• Code entered in box

I0020B of the MDS

• Has the patient had a

surgical procedure during

their inpatient stay related

to their SNF care plan?

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CLINICAL CATEGORY

AND FURTHER A PT/OT CATEGORY

NEXT IT LOOKS AT SECTION O OF THE MDS

• Are any Extensive Services reported?

• Tracheostomy?

• Ventilator?

• Isolation?

Yes Factored into a CMI

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ADL SCORES REPORTED IN SECTION G

• Looks at both patient Self-performance and how much Support needed by staff

Factored into a CMI

FUNCTIONAL GOAL SETTING-SECTION GG

• Admission performance is then scored in

• Eating

• Oral and Toileting hygiene

• Bed mobility

• Transfers (sit to stand, bed to chair, etc.)

• Walking

Factored into CMI

COGNITIVE PATTERNS

• Scored by a PHQ-9 or

• Staff assessed if • comatose, or have difficulty

making themselves understood

Factored into CMI

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SPEECH LANGUAGE PATHOLOGY

• Swallowing disorders?

• Mechanically altered diet?

• Other comorbidities, • Examples: aphasia, stroke, laryngeal cancer

Another CMI is calculated

RESTORATIVE NURSING PROGRAMS

• Nursing interventions that promote a resident’s ability to reach their highest level of function

• Different than formal physical or occupational therapy

NON-THERAPY ANCILLARY

• CMS did not consider Non-Therapy ancillary conditions that

needed additional resources

More points factoring into a

CMI

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EXAMPLE OF ONE OF THE CMI CALCULATIONS

• From the CMS “grouper tool”

FINAL PDPM HIPPS CODE

• All of those items on the previous

slides are scored and a case mix code

is generated in each of 5 categories:

• PT Group

• OT Group

• SLP Group

• NTA Group

• Nursing Group

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/SNFPPS/Downloads/PDPM_Technical_Report_508.pdf

HIPPS CHARACTERS

1st 2nd 3rd 4th 5th

PT/OT SLP Nursing NTA Type of Assessment

= Per Diem $ amount

• NTA CMI x 3 first three days

• PT/OT CMI progressively decreases 2% each week beginning at day 20 until day 100

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URBAN VS RURAL

• Based on zip codes, they get a few more case mix dollars

• https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/SNFPPS/WageIndex

MR. BONES

• Primary diagnosis: Unspecified dementia with

behavioral disturbance F03.91

• Hyperlipidemia

• Bipolar depression

• Dysphagia

• Incontinent

• Fever with unknown origin

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AMERICAN ASSOCIATION OF NURSE ASSESSMENT COORDINATORS

• The American Association of Nurse Assessment Coordination (AANAC) is a subsidiary of the American Association of Post-Acute Care Nursing (AAPACN). Together with its sister association, the American Association of Directors of Nursing Services (AADNS), AANAC represents more than 16,000 healthcare clinicians from over 5,750 nursing homes within the long-term and post acute-care care field, covering the full spectrum of the profession.

• Resident assessment instrument (RAI)/minimum data set (MDS 3.0) process

• Clinical assessment and care planning

• Medicare reimbursement processes

• Regulatory requirements

• Quality Indicators and Quality Measures

• Legislative policy Patient-driven Payment Model

www.aanac.org

[email protected]

COMPANY CONFIDENTIAL

Wide range of services provided to a “patient” in their home

Less costly than care delivered in an inpatient facility

Includes Skilled and Non-Skilled care

COMPONENTS OF A HOME HEALTH AGENCY

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CMS CONDITIONS OF PARTICIPATION

https://www.federalregister.gov/documents/2017/01/13/2017-00283/medicare-and-medicaid-program-conditions-of-participation-for-home-health-agencies

MEDICARE COVERAGE

A Hospital, SNF, Home Health Care, Hospice Care

B Doctor and other HC providers, Outpatient care, DME, Home Health Care, many preventative services

CMedicare Advantage (MA) Plan

Covers Part A, Part B, and often Part D drugs

D Prescription Drug Benefit

HOW ARE HOME HEALTH AGENCIES PAID BY

MEDICARE?

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Home health agencies are

required to do a detailed

assessment on every patient.

OASIS stands for Outcome

ASsessment Information Set. A

long Head-to-Toe assessment a

nurse or therapist performs on a

patient.

LET’S BREAK IT DOWN….

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•The OASIS assessments show the government how sick and how much care

the patient needs.

•Based on the codes put into each of the boxes in the OASIS assessment, a

payment level is derived (called a HHRG or “herg” for short)

•The OASIS assessment is also used by the agency to plan the care of the

patient through the 60 days of care also called an EPISODE of care.

WHY DO THEY HAVE TO DO AN OASIS ASSESSMENT?

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OASIS EXAMPLE:

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PATIENT DRIVEN GROUPINGS MODEL(PDGM)

• Ultimately comes up with a (Home Health Resource Group)

HHRG which correlates to a HIPPS code with a case-mix

weight


and an End

WHAT IS AN EPISODE?

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Recertify

Payment Episode-3

Payment Episode-2

Has a Start

…and an End

COMPANY CONFIDENTIAL 57

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LET’S BREAK IT DOWN

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Institutional vs Community


MR. BONES

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1st 30 days

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MMTA= Medication Management, Teaching and Assessment


M62.562 Muscle wasting and atrophy, NEC, left lower leg

MR. BONES EXAMPLE

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Functional impairment level components:

• Risk for Hospitalization• Ability to Groom themselves• Dress themselves• Bathe themselves• Transfer from a bed to a chair or move themselves in bed• Ability to walk safely


EACH OF THE FUNCTIONAL IMPAIRMENT AREAS ACCRUES A POINT VALUE

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= 11 pts

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Total Functional Score = 40



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MR. BONES:

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Comorbidity: simultaneous presence of two chronic diseases or conditions in a patient

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Short answer: a very long algorithm

• Low comorbidity adjustment: there is a secondary diagnosis that is on the government’s list as requiring higher resource use (RNs, dressing changes, therapies)

• High comorbidity adjustment: there are 2 or more secondary diagnoses that are associated with higher resource use when both are reported together compared to separately.

• No comorbidity adjustment: there is no secondary diagnosis that fits in either of the above.

HOW IS THE COMORBIDITY ADJUSTMENT CALCULATED?

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End stage renal disease

Hypertensive heart disease with heart failure

MR. BONES:

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MR. BONES:

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Let’s calculate his Home Health Resource Group written as a HIPPS code

Each character or the Health Insurance Prospective Payment System

(HIPPS) is associated with the PDGM variables as previously described

Position #1: Timing and Admission Source

Position #2: Clinical Grouping

Position #3: Functional Impairment Level

Position #4: Comorbidity Adjustment

Position #5: Placeholder

MR. BONES:

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MR. BONES:

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MR. BONES

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• Each 30-day period is assigned into on of the 432 case mix groups. Mr. Bones’ group is 2EB21 with a case-mix weight of 1.3845.

• National rate is $3,151.22 per 60 day episode, or $1,575.61 per 30 days.

• For this Early-Institutional Claim, first 30 days he was in care,The Home Health agency will be paid: 1575.61 x 1.3845= $2,181.43

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[email protected]

HOW ARE POST-ACUTE CARE (PAC) AUDITS CONDUCTED

Skilled Nursing Facility

MANAGED CARE AUDIT

CONTRACTORS’ PROCESS

Contractor request for records sent (MDS, chart notes) [desk audits]; or sets up a date to review the records [onsite]

Auditor reviews Claim, MDS and chart notes in comparison to Managed Care insurance company contract

Audit findings documented on proprietary auditor sheets/software

Contractor sends audit findings to agency and demands repayment or appeal

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RUG AND PDPM PAYMENT CONTRACTS-MANAGED CARE

• Auditor will look at MDS, therapy documentation (for RUG audits) and medical chart

notes for items such as:

• Were ADL scores calculated properly

• Items pertaining to NTA comorbidities coded within in the MDS backed up in the chart

• Isolation coded in the MDS- did they follow true isolation protocols

• Extensive services or restorative services done during the lookback period of that MDS.

With the required elements met.

EXAMPLE OF MANAGED CARE/LEVEL OF CARE CONTRACT

• Level 1 usually contains basic care, ostomy care, medications, labs, and therapy under 2 hours ($250/day)

• Level 2 often >2 hours therapy, IV injections, wound care, higher cost medications, i.e. Lovenox, and isolation ($350/day)

• Level 3 often contains over 2.5 hours of therapy, high cost medications such as Arixtra, central line care, ($450/day)

• Level 4 and 5 often include such care as respirators, stage IV pressure ulcer care, and in-house dialysis (over $500/day)

Consists of

1-5 Levels

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MEDICAL NECESSITY

AUDIT BASICS

RACs and Managed Care insurance companies

Often use industry standard guidelines

• Milliman Care Guidelines (CMS endorsed in 2010)

• McKesson Interqual Criteria• RAI (Resident Assessment Instrument)

Manual. Updated every October• Level of Care contract if managed care

billed by LOC

MEDICAL NECESSITY

AUDIT BASICS (CONTINUED)

• MD order for skilled nursing care

• Treatment, duration and frequency of treatments must be reasonable with regards to resident’s condition, prior level of function, expected outcome

• As a practical matter can services can only be received as an inpatient of a SNF

• Needed on a daily basis • Skilled nursing=7d/week • Rehab therapy ≥ 5d/week

MEDICAL NECESSITY AUDIT BASICS (CONTINUED)

Skilled Nursing

examples

• IV and IM injections / IV feedings. (SQ injections and oral meds are not considered skilled)

• Tube feedings over a certain % of daily caloric intake, ostomy care initially post-op

• Naso-pharyngeal and tracheotomy suctioning and oxygen therapy• Insertion, irrigation, and replacement of suprapubic catheters (not regular

urinary catheters)• Treatment of pressure ulcers, Stage 3 or higher, or other skin disorders and

wound care that rise to the level of skilled• Heat treatments ordered by MD that require supervision• Rehabilitative nursing procedures, i.e. bowel and bladder programs

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HOW IS A RUG/PDPM AUDIT CONDUCTED

Typical day of an auditor for a Managed Care

RUG audit- desk audit

Given a “queue” of

approximately 15-20 audits

A .pdf of the resident’s chart, including all therapy documentation, nursing

notes, MDS assessments, claims

The auditor will view the MDS assessment• Be sure the ARD is set correctly• Days billed are correct• PPS/OMRA assessments

completed in a timely manner• Items within the MDS tying to

billing components are clearly documented in medical record

Calculations are made of therapy

minutes and ADLs (RUG); Items that tie into category CMI’s (PDPM)

HIPPS code is assigned. If incorrectly billed, items will

be documented in an auditing software which will

then generate a letter requesting reimbursement

from the SNF

LET’S WALK THROUGH AN EXAMPLE OF AN ERROR

• This would cause CMS to actually reject a Medicare A MDS assessment (CMS edits)

• MDS double dipping into NTA co-morbidity points

• Duplicated ICD-10

• Qualifies under the Cardio-Respiratory Failure and Shock NTA category

• Worth 1 NTA point each

Chronic Respiratory failure code

• If this resident is also coded as

having needing Oxygen and

Suctioning

• That adds one additional point Chronic Respiratory failure code

+1

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LEADS TO EXTRA POINT AND HIGHER CMI

+1

HOW ARE PAC AUDITS CONDUCTEDHome Health Agencies

HOW IS A RUG/PDPM AUDIT CONDUCTED-MA FIRM

Typical day of an auditor for a

HHA audit- desk audit

Given a “queue” of

approximately 15-20 audits

A .pdf of the resident’s chart, including all therapy documentation, nursing notes, OASIS assessments, claims

The auditor will view the OASIS assessment• Days billed are correct• Assessments completed in a

timely manner• Items within the OASIS tying

to billing components are clearly documented in medical record

Calculations are made using

Claims data and OASIS

HIPPS code is assigned. If incorrectly billed, items will

be documented in an auditing software which will

then generate a letter requesting reimbursement

from the HHA

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GOVERNMENT SPONSORED AUDITS

Recovery Audit Contractors (RAC)

Zone program integrity contractors (ZPIC)

Medicare audit contractors (MAC)

HOME HEALTH RAC AUDIT PROCESS

RAC reviews claims where improper payments have

been made or a high probability that improper

payments were made

RAC communicates the data found with the MAC so corrective actions can

be taken

When a RAC audit finds an error, a Notification of Improvement Payment (NIP) is sent to agency

NIP indicates audit issues, applicable laws, amount of overpayment and how

it was calculated, and agency’s appeal rights

Agency has 45 days from date on NIP to respond to

the RAC

RAC has 30 days to submit its decision letter

HOME HEALTH AGENCY AUDITS

• Most recent targeted areas include:• Patient response to treatment is not being documented

• Principal/Primary diagnosis must be the Focus of Care and Related to the Face to Face Encounter

• Physician/Allowed Provider’s documentation must support all diagnosis (PDGM Clinical Grouping and Comorbidity Adjustment)

• Documentation must support the patient is eligible for home health under Medicare ( Patient is home bound, requires skilled need [intermittent nursing, physical therapy, speech therapy and continuing need for occupational therapy], be under the care of a physician/allowed provider and a face to face encounter has occurred)

• Clinician documentation should support the OASIS responses for the PDGM Functional Impairment Level

• Documentation must support the medical necessity/skilled need for all services (nursing and therapy)

• All physician/allowed providers orders and the Plan of Care must be signed and dated.

Information provided by McBee Associates: https://mcbeeassociates.com/

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REVIEW CHOICE DEMONSTRATION

• Currently on pause due to COVID-19 pandemic (started June 2019)

• CMS testing it out in a few states

• Pre-claim review,

• Postpayment review, or

• Minimal postpayment review with a 25% payment reduction.

https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Review-Choice-Demonstration/Downloads/RCD-FAQs.pdf

SKILLED NURSING FACILITY RAC FOCUS

PAST: Physical therapy documentation has been the key focus area

PRESENT: Most recent targeted areas (due to implementation of PDPM)

• Nursing documentation, diagnosis coding, NTA and SLP comorbidities

• They will be watching resident outcomes to determine if SNFs are over-delivering services

(often referred to as “defensive medicine”) or under-delivering services.

• Keep in mind, CMS expected PDPM to be budget neutral

• Therapy will still be under heavy scrutiny but in a different way, are patient outcomes

still the same with therapy delivery drastically cut?

• MD Certifications for SNF care-Only the MD or NP can date his/her own signature

• If an auditor finds different handwriting it can be overturned and entire SNF stay rejected

https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Recovery-Audit-Program/Approved-RAC-Topics

https://skillednursingnews.com/2019/08/how-skilled-nursing-facilities-can-prepare-for-medicare-audits-under-pdpm/

ADDITIONAL REFERENCES

• Medicare.gov

• http://www.frrcpas.com/news/2014/pepper-for-skilled-nursing-facilities

• AANAC Medicare University: Part B Therapy in a Skilled Nursing Facility; Brandt, October 2015 Version

• AANAC, RAC-CT Course: Introduction to Medicare Part A

• CMS RAI Manual

• http://www.harmony-healthcare.com/blog/topic/case-mix

• https://www.cms.gov/Research-Statistics-Data-and-Systems/Research/HealthCareFinancingReview/Downloads/CMS1191979dl.pdf

• http://www.health.state.mn.us/divs/fpc/profinfo/cms/cmrmanual.pdf

• http://www.ptbillingservices.com/the-8-minute-rule-how-does-it-work/

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RESOURCESSome great resource locations:

https://www.racmonitor.com or a browser search: post acute care audits, skilled nursing facility audits

https://skillednursingnews.com

https://www.mcknights.com/

https://homehealthcarenews.com/

https://www.aanac.org/

https://oasisanswers.com/content/ExamPrep

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/NursingHomeQualityInits/MDS30RAIManual

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HomeHealthQualityInits/HHQIOASISUserManual

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Post-Acute-Care-Quality-Initiatives/PAC-Quality-Initiatives

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/SNFPPS/PDPM

[email protected]

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