Posts Tagged: medical coding

Denials for Lack of Physician Orders

Connolly Review Results Letters Arrive Soon After Records Submitted

Word to the wise: Make SURE you have a process in place to check ALL (Medicare, at least) claims that go out your door to be paid, to insure that a clearly worded, appropriate Physician Order exists in the medical record.

If you do NOT insure that the order exists, you are risking the entire reimbursement. And if CMS decides that a pattern of this type of error is in your facility or practice… you are risking FAR more than that reimbursement.

Before I get to the subject of the headline, let me review what else was going on, recently.

Seven New Issues Posted

Last week was a pretty quiet week, which almost no activity by any of the RACs, except for a few additions by Connolly and HDI, on Friday, September 17. Connolly added 20 new DRG Validations, listed in five of six new (yes, really NEW) issues.

1 Duplicate Claims – DMEPOS
2 MSDRG 056: Degenerative Nervous System Disorders with MCC
3 MSDRG 057: Degenerative Nervous System Disorders without MCC
4 MSDRG 249: Percutaneous Cardiovascular Procedure with Non Drug-Eluting Stent without MCC
5 MSDRG 368, 369, 370, 371, 373, 377, 378, 379, 380, 381, 382, 383, 384, 385, 387, 388, 389, 390, 391, 392, 393, 395: Gastrointestinal Disorders
6 MSDRG 820: Lymphoma and Leukemia with Major O.R. Procedure with MCC

HDI added Part A Services delivered during a Hospice period.

1 Hospice Related Services – A

But these “new” issues are not all that happened…

Many Edits Made

Over the past couple of weeks, there have been many edits made to existing posts on all four of the RAC sites.

For example, many posted issues for Region A, DCS, actually removed some states from some of their approved issues. You might want to check the list, especially if you are in Vermont, New Hampshire or Maine. (Vermont was dropped from 14 issues, New Hampshire from 12, and Maine from less than that.)

Acute readmissions have been a recognized target for RACs for some time. There was an interesting edit made to the issue as posted on Region D, HDI’s site. Previously, the issue would deny for same day acute re-admissions for the same DRG with no B4 codes on the second claim. Now, it denies for no B4 or 42 Condition Codes on the second claim.

Another edit made in Region D: under the DRG Validation issue for Nervous System Disorders, MSDRGs 075 and 076 were specifically removed from the approved DRG list. Now, I caution everyone, be careful to not transpose those numbers – in the same issue are the approvals for Medical Necessity and DRG Validation for MSDRGs 057 and 056. I warn you because I myself have more than once looked at the list and been puzzled by it, when I kept thinking that the wrong ones were removed.

Denials for Lack of Physician Order

Despite the lack of activity on the lists themselves, the RACs have been very busy, sending out review results letters and denials. We have seen in Region C the first denials to come thru for a lack of or improper physician orders in a medical record. The types of claims being denied are both inpatient and outpatient. I can give you two examples that happen to be short stays.

An outpatient claim, where the patient wound up staying for 3 days. At some point, the patient’s status was changed to inpatient, which would have been appropriate (I’m told by the provider), except for one thing: in the documentation, there is a Nurse’s note, changing the patient status to inpatient, but there is nothing at all in the record that indicates that a physician ever approved or ordered this change. The claim was therefore denied, and the provider has no chance on appeal, because the physician’s order simply does not exist.

An inpatient claim, a 1-day stay: the patient was admitted to inpatient, even with just an 8-hour stay. I was told that the services were, in fact, inpatient services, and could have survived audit for inpatient status. Well, it could have survived, except for one thing: no physician order appears in the record to admit to patient to anything. Once again, the claim was denied; and again, there is no chance to appeal, since the order simply does not exist in the record.

Want to know the scary thing? Those claims were very easy to deny, they are not “worthy” of appeal, and the provider told me that the number of records requested was very few, compared to the limits that the RAC could ask for. In other words, the RAC knew exactly which records to ask for, and they were right on the money.  It seems like this is the proverbial “Easy Money” for the RAC.

Like I said, “Word…”

Why Did They Wait?

But if this is so easy, then why wasn’t the RAC doing this more, before now? My opinion is that the RACs have been waiting for at least some of the Medical Necessity issues to be released, so that they don’t have to ask for the records again, or so that they can have all their weapons loaded before they begin the battle in earnest. I think it is because the RACs are private companies, who actually care about efficiency. In the private sector, efficiency means more profits, and this makes private sector companies much better at this kind of work than many government agencies, who don’t have to worry about such “bourgeois” concerns as “profits.”

So What’s the “Word”?

Providers need to insure they have a reliable process in place to check documentation for physician orders before any claim is filed.

Which ones should they check? Only the ones they intend to send out the door. The RACs are willing to do this job for just nine percent of the claim (in Connolly’s case, anyway).

A provider, then, should be willing to do this for slightly more than that… say, 100 percent of the claim.

So I guess I’ll say that’s the “Word”: 100%.

That’s what is at stake, and that’s what providers should check.

How an MCC Became a CC

DCBAWhy AKI was demoted to CC status by CMS

By Robert S. Gold, MD, CEO, DCBA, Inc.

PDF download of this article HERE.

In March 2008, the National Kidney Foundation sent a letter to the National Centers for Health Statistics and asked that the term “acute kidney injury” (AKI) be an optional phrase for assigning ICD-9-CM code 584.9 (i.e., that it was the current terminology for what used to be called “acute renal failure.”) The request was granted.

CDI specialists and coders looked at the definitions published through the Acute Kidney Injury Network and noted the criteria of stages 1, 2 and 3 of AKI. They began to ask physicians to document AKI whenever a patient’s labs or urine output met those criteria. But in so doing we hurt ourselves-and we hurt “acute renal failure.” And it’s a shame. Now, with CMS’ resulting reduction of acute renal failure to CC, it now has no more severity attached to it than a simple urinary tract infection.

Let’s see where we went wrong and where we have to go to get it right.

WHAT AKI WAS

Long ago, in a galaxy far, far away, we had the terms “acute renal insufficiency” and “acute renal failure,” and we had advice as to when each was appropriate terminology to use in order to assign the codes that were designed for those conditions. These codes included 593.9 for renal insufficiency and 584.9 for acute renal failure (notice I didn’t use the term “acute” in the description of 593.9-it was a nonessential modifier then).

In the medical textbooks and within the medical community there was confusion in the terminology. For example, one medical textbook called the disease “renal insufficiency” and talked about “progressive renal failure,” and another textbook had a chapter entitled “renal failure” and spoke of “anemia of renal insufficiency.”

AHA’s Coding Clinic for ICD-9-CM, First Quarter 1993, p. 17, gave us the following definitions as guidance:

Renal insufficiency
It is generally accepted that renal insufficiency (code 593.9, Unspecified disorder of the kidney and ureter) refers to the early stages of renal impairment, determined by mildly abnormal elevated values of serum creatinine or BUN or diminished creatinine clearance. Clinical symptoms or other abnormal laboratory parameters may or may not be present but are usually minimal.
The treatment of renal insufficiency depends to a very large extent on the underlying cause, with much attention given to the possibility of preventing progression to renal failure.

And on p. 18, Coding Clinic states:

Renal failure
Renal failure (code 584, Acute renal failure, code 585, Chronic renal failure, code 586, Renal failure, unspecified) is a progression of renal insufficiency where renal function is further impaired and overt clinical consequences, such as anemia, have developed. In essence, renal insufficiency is more of an abnormal laboratory assessment, while renal failure incorporates both abnormal laboratory and clinical findings.

Back then, we looked for more than dehydration. We looked at more than a minor bump in creatinine. We looked for a sick patient. Sure, there may have been obstruction due to prostate cancer associated with a high creatinine level which returned to normal soon after suprapubic tube insertion.

Yes, there may have been a patient found down for three days at home who came in with depressed mental status and rhabdomyolysis and responded to a couple of liters of IV fluids in a couple of days. And these patients came back, at least measurably, to normal. But they were sick and they had acute renal failure. And if a patient had two days of diarrhea “altered mental status” and responded to a glass of water to return the creatinine level to normal, we were happy with dehydration or prerenal azotemia or acute renal insufficiency-because that’s what is was.

During this time, the renal world recognized the problems with lack of consistency and did some studies of acute decrease in renal function. It came up with mortality rates, rates of need for Renal Replacement Therapy (RRT – or dialysis) and identified three pretty distinct levels of change in creatinine, change in Glomerular Filtration Rate (GFR) and change in urine production. It also identified two levels of long-term outcome: Return of measurable function, or no return of measurable function. They published their results and findings and called the system RIFLE. And all rejoiced.

But there were two issues of massive importance that somehow didn’t get into the subsequent evolution of acute damage to the kidneys. First, all of the studies were done in critical care units on critically ill patients. Certainly there was mortality-but it was not clear whether the mortality came either from the renal damage or from the other conditions that the patients had at the time of death.

It was merely an observation of mortality, regardless of the cause, in patients with measurable changes in renal function. Secondly, and they were very specific about this-RIFLE only applied to intrarenal damage and did NOT apply to prerenal causes or postrenal causes. Basically, they said that the patients who actually had what they believed was acute tubular necrosis or hemorrhage of the kidney or infectious or immune destruction of renal parenchyma counted, and that the patients with elevations of creatinine due to dehydration without ATN or elevations of creatinine due to obstructing bladder cancer did not count.

Several iterations of acute kidney injury studies followed to validate the results and recommendations above and the Acute Kidney Injury Network was formed. Again, all of the studies were done on critically ill patients on critical care units. But this group changed some of the rules. They eliminated GFR change as a valid measure and that was reasonable, especially if one didn’t know what the patient’s creatinine was before the insult and didn’t know if the end result was a decrease in function or not. And other less important issues could impact GFR than the renal destructive condition.

And then they said that their new staging of “AKI” was applicable to prerenal and postrenal causes because, in critically ill patient in critical care units, many had intrarenal damage because of prerenal and postrenal causes. The problem is that all of their patients again were critically ill and on critical care units. They did not look at creatinine change or urine output change in patients who didn’t make it to the ICU.

I think that this overlooked the 80+% of patients who have changes in creatinine or urine output that falls within their established criteria-particularly of Stage 1.

As an aside, let’s take a quick look at the term “injury” as it has pertained to other organs. There was a time that the pulmonology groups spoke of “acute lung injury” and there were a ton of publications talking about “acute lung injury.” What these investigators recognized is that the myriad of diseases that fall into the category of “acute lung injury” included the range of the most mild to the most severe and that the identification of the particular disease was more important than the vague term of “injury.” Thank goodness for that.

Acute lung injury due to viral pneumonia is a totally different animal than acute lung injury from ARDS due to amniotic fluid embolism. And they now continue to clarify “acute respiratory failure” and distinguish it by pathologic change rather than dwelling on a new term that has no specificity for risk. Should the renal world follow this lead? It’s not for me to say.

WHAT AKI IS

So we are left with a term, “acute kidney injury,” that has a myriad of levels of severity, and entering a reimbursement world where classification of failure of an organ-the kidney – is not an MCC at all. It’s the only failure of an organ that is not a major condition. Why? I believe it’s because the proper homework wasn’t done.

Because of the approved definition of 584.9 to include AKI, all levels of AKI were included in the statistics generated through coding and CDI initiatives. And patients with a creatinine bump of 0.3 mg% due to dehydration who were treated with a glass of water were reported with 584.9-and they went home in six hours when they cleared up mentally.

We have met the enemy and they is us (with fond memories to the critters of the Okeefenokee swamp).

Certainly, patients with stages 2 and 3 AKI are pretty darned sick-and I would guess that a significant portion of patients with stage 1 are sick, as well. But it may not be from the renal disease specifically. They do have other organs!

WHAT AKI SHOULD BE

I see a couple of options to fix the problem and I’ve worked with some of the authorities in renal disease medicine on this. The first is to create individual codes for the three stages of AKI (if we’re going to stay with AKI). And with these levels, we could perform some analysis on all patients with the identified stages, not only on patients on ICUs. We could run statistics from ICU patients only, non-ICU patients only, and all patients, just to see if there is an identifiable difference in mortality or in long term damage of renal function between the groups. By examining mortality, the rate of RRT, and cost, we would have a viable way to identify which patients are sick-who has a major disease-and who isn’t.

The second option is to follow the lead of the pulmonologists and dump AKI. From a coding, resource utilization, and CMS perspective, that’s a great option. From the perspective of statistical analysis of risk of mortality, we need the breakdown of “acute renal failure” or “acute kidney injury” to be studied, analyzed, and classified appropriately. This cannot be accomplished by repeating the flawed studies of the past. Let’s open it up to all comers. If the definition of the disease applies to all comers, the studies have to be done on all comers.

In the meantime, CDI specialists and coders who are dealing with the rules as they exist must look at how sick the patient was and how the patient was treated. If the cause of a bump in creatinine is dehydration and the patient’s treatment consists of a bolus of 500 cc of crystalloid in the ED and then regular diet, or consists of IV fluids at a normal rate of 75 – 100 cc/hour with no efforts at real resuscitation of vital signs and perfusion, and if the patient responds rapidly to these treatments, the patient should be considered to have the old acute renal insufficiency and not coded to 584.9 because it was not failure and it did not entail “kidney injury.” If we’re going to use “AKI,” we have to be able to validate injury, reversible or not. There has to be some consequence.

In fact, Mehta and his group of international nephrologists unanimously agreed that the “that application of the diagnostic criteria would be used only after an optimal state of hydration had been achieved.” (Acute Kidney Injury Network: report of an initiative to improve outcomes in acute kidney injury, Critical Care, volume 11, issue 2) [Ed. -- or get the full text PDF here.]

Some consultants are now advising their clients to tell the docs to document “acute tubular necrosis” rather than AKI across the board. That’s a very questionable practice and can do nothing but get you into trouble. If the case is one in which the patient probably has measurable injury of the kidneys, after fluid resuscitation, with acute tubular necrosis due to salicylate poisoning or sepsis or shock, sure-call it acute tubular necrosis, because that’s what it likely is. Even severe dehydration with significant hypovolemia can cause ATN-but it should be significant.

Got it?

About the author:

ROBERT S. GOLD, MD, CEO

Dr. Robert S. Gold is co-founder of DCBA, Inc., and has more than 44 years of experience as a physician, medical director and consultant. A graduate of Hahnemann Medical College in Philadelphia, he trained in General Surgery in the U.S. Navy where he spent his professional career as a practicing surgeon. Since leaving the service, he has worked as a consultant in the fields of Managed Care Medicine, Locum Tenens, Home Health, Hospital accreditation and licensure and, most notably over the past ten years, in audit and education regarding documentation, coding and billing accuracy (DCBA) for healthcare services.

Nationally known for his education regarding the clinical orientation of coding in AHIMA teleconferences and at the National Conference for the Society for Clinical Coding, Dr. Gold is a frequent speaker at industry conferences and is widely published.

Region B RAC Adds Review of Inpatient Admit Orders, 95 DRG Validations

RAC-LOGO-CGIIn the continuing posting of issues, the RAC contracted for the upper midwestern states, CGI Federal, has now joined Connolly Healthcare in its posting of an issue that can possibly recoup all Medicare Part A charges for an inpatient claim, and still not even touch the dreaded issue of Medical Necessity.

The List

Below are the 15 new issues, posted last week. Follow the links to each one, in the eduTrax RAC New Issue Database®, which can be seen with simple free registration at myedutrax.com.

1 Date of Death-DME
2 Inpatient Admissions without a Physician’s Inpatient Admit Order
3 MSDRG 052, 053, 054, 055, 056, 057, 058, 059, 060, 061, 062, 063, 067, 068, 069, 070, 071, 072, 073, 074, 077, 078, 079, 080, 081, 082, 083, 084, 085, 086, 088, 089, 090, 091, 092, 093, 097, 098, 099, 101, 102: DRG Validation for Nervous System Disorders
4 MSDRG 165: DRG Validation for Major Chest Procedures
5 MSDRG 168: DRG Validation for Other Respiratory System O.R. Procedures
6 MSDRG 175, 176, 180, 181, 182, 183, 184, 185, 186, 187, 188, 192, 196, 197, 198, 199, 200, 201, 202, 203, 204, 205, 206: DRG Validation for Respiratory
7 MSDRG 242, 243, 244: DRG Validation for Permanent Cardiac Pacemaker Implant
8 MSDRG 247, 249, 251: DRG Validation for Percutaneous Cardiovascular Procedures
9 MSDRG 326, 327, 328: DRG Validation for Stomach, Esophageal and Duodenal Procedures
10 MSDRG 371, 372, 373: DRG Validation for Major Gastrointestinal Disorders and Peritoneal Infections
11 MSDRG 405, 406, 407: DRG Validation for Pancreas, Liver and Shunt Procedures
12 MSDRG 474, 475, 476: DRG Validation for Amputation for Musculoskeletal System and Connective Tissue Disorders
13 MSDRG 490, 491: DRG Validation for Spinal Fusion
14 MSDRG 533, 534, 537, 538, 562, 563: DRG Validation for Musculoskeletal Fractures
15 Prosthetic Additions When Billed With Initial Or Preparatory Knee Prosthesis

More to Come

We’ll have more to say about the review of Physician orders, soon…

RAC 101 – The Movie

New Video Posted by CMS

CMS posted a recording of a RAC 101 seminar conducted by Connie Leonard and Commander Marie Casey, earlier in April. If you missed the RAC 101 conference call on April 28, this is probably the same script.

The video includes a short Q&A period, with what we would characterize as typical FAQs.

However, there were two questions asked during this video that produced two previously unheard answers:

  • While RACs can use extrapolation, there are currently no issues approved that can use extrapolation; and
  • When one RAC is approved for a new issue, the other three RACs do not automatically receive approval for that same issue — the other RACs must submit their own case to be approved for their region.

Find the video HERE.

Connolly Adds 20 More in April

More High Dollar, High Volume DRGs

Connolly Healthcare, the RAC for Region C, posted 20 new DRG Validation Issues to their list of CMS-Approved audit issues, on Friday, April16. The list includes eight (8) MS-DRGs with very high Relative Weights (which equates to high dollar reimbursements and thereby potentially high RAC fees) and six (6) with claim volumes in the top 25% of all DRGs (providing a rather large number of claims to potentially audit).

Four (4) of the newly approved issues are for MSDRGs with Relative Weights of better than 10.0.  Such claims have high dollar reimbursements, averaging over $45,000 per claim, nationwide.

Once again, these approval/postings seems to continue a pattern previously noted. (See our posts from February 9 and March 17.)

Virgina and West Virginia Now Included

The states of Virginia and West Virginia have been absent from the list of states affected or approved for any issues, until some recent changes to the lists, earlier in April. Still, not all the issues have been approved for these two states.

The New Issues

Below are the new posted and approved audit issues for RAC Region C, including Relative Weights and FY09 Discharge Ranks:  (a low rank number relates to a large number of discharges for that DRG, nationwide)

  • MS-DRG 003: ECMO or Tracheotomy with Mechanical Ventilation 96+ Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. (RW 18.27; Rank 122)
  • MS-DRG 001: Heart Transplant or Implant of Heart Assist System with MCC (RW 24.85; Rank 720)
  • MS-DRG 005: Liver Transplant with MCC or Intestinal Transplant (RW 10.14; Rank 713)
  • MS-DRG 332: Rectal Resection with MCC (RW 4.78; Rank 297)
  • MS-DRG 562: Kidney Transplant (RW 1.38; Rank 79)
  • MS-DRG 011: Tracheotomy for Face, Mouth, and Neck Diagnoses with MCC (RW 4.73; Rank 476)
  • MS-DRG 012: Tracheotomy for Face, Mouth, and Neck Diagnoses with CC (RW 3.03; Rank 584)
  • MS-DRG 020: Intracranial Vascular Procedures with Principal Diagnosis of Hemorrhage with MCC (RW 8.44; Rank 696)
  • MS-DRG 021: Intracranial Vascular Procedures with Principal Diagnosis of Hemorrhage with CC (RW 6.21; Rank 696)
  • MS-DRG 927: Extensive Burns or Full Thickness Burns with Mechanical Ventilation 96+ Hours with Skin Graft (RW 13.74; Rank 629)
  • MS-DRG 929: Full Thickness Burn with Skin Graft or Inhalation Injury without CC/MCC (RW 2.01; Rank 728)
  • MS-DRG 023: Craniotomy with Major Device Implant/Acute Complex Central Nervous System Principal Diagnosis with MCC or Chemo Implant (RW 4.94; Rank 469)
  • MS-DRG 024: Craniotomy with Major Device Implant/Acute Complex Central Nervous System Principal Diagnosis without MCC (RW 3.26; Rank 212)
  • MS-DRG 007: Lung Transplant (RW 9.45; Rank 689)
  • MS-DRG 076: Viral Meningitis without CC/MCC (RW 0.83; Rank 510)
  • MS-DRG 461: Bilateral or Multiple Major Joint Procedures of Lower Extremity with MCC (RW 4.56; Rank 187)
  • MS-DRGs 799, 800, 801: Splenectomy w MCC, w CC, w/o CC/MCC (RW 5.11, 2.53, 1.59; Ranks 666, 709, 620)
  • MS-DRG 177: Respiratory Infections & Inflammations with MCC (RW 2.05; Rank 35)
  • MS-DRG 178: Respiratory Infections & Inflammations with CC (RW 1.49; Rank 132)
  • MS-DRG 179: Respiratory Infections & Inflammations without CC/MCC (RW 1.01; Rank 119)

To see the complete original listings (on the RAC websites), visit this page.

Or, to find a more useful listing of all their posted issues, visit  this page on eduTrax.  (Registration required.)

Still No Medical Necessity Reviews

All of the above approved issues still include this caveat:

(At this time, Medical Necessity excluded from review).

As faithful readers know, however, Medical Necessity Reviews could be approved by CMS at any time now, since the CMS RAC Review Phase-In Strategy allows for such audits in calendar 2010.

We will shortly post further analysis, in an overview of the DRG Validations posted to date by all four RACs.

Part A Denial is NOT Automatic Denial for Part B Services, Says Medicare Appeals Council

The Centers for Medicare and Medicaid Services (CMS) recently asked the Medicare Appeals Council (Council) to review and overturn an Administrative Law Judge (ALJ) “partly favorable” decision for O’Connor Hospital, of San Jose, California. The case originated in 2007 during the Recovery Audit Contractor (RAC) Demonstration Project. In its request to have Council review the appeal, CMS attempted to argue that the Part B services were not separately billable under Part A, and therefore the ALJ had erred as a matter of law when it ordered CMS to pay the provider the difference between the covered and non-covered services.

On February 1, 2010, the Council posted their decision: they did not agree and stated that the position of CMS was essentially inconsistent with policies found in its own manuals.

On December 7, 2007, the RAC charged with auditing California providers denied Medicare coverage for a claim of inpatient hospitalization services, as furnished to a beneficiary on November 1, and 2, 2004, at O’Connor Hospital. The RAC found the services provided were not “reasonable and necessary” per the Social Security Act, and therefore the hospital had received an overpayment. Like virtually every other claim filed by a RAC during the demonstration, said overpayment finding was upheld at both of the first two levels of the appeals process.

The first level of appeal in the RAC program, when requested by the provider, is a Redetermination. This is an additional examination of the claim by the RAC, supposedly by personnel who are different from the personnel who made the initial determination. One might consider this as simply a chance to ask the RAC to be sure to check their paperwork. We are not aware of any denials being overturned at this level of appeal during the Demonstration project.

The second level of appeal, again when requested, is a Reconsideration. These are always conducted by a Qualified Independent Contractor (QIC), thereby allowing an independent review of medical necessity issues by a panel of physicians or other health care professionals. (This is a change from previous programs, but did not originate with the RAC. These reviews were instituted in Section 521 of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), and replaced the Hearing Officer Hearing process for Medicare Part B claims, while creating a “new” second level of appeal for Medicare Part A claims.)

The provider took the claims to the next level of appeal, the Administrative Law Judge, or ALJ. There were four claims in question for four different beneficiaries at O’Connor. On September 16, 2009, the ALJ overturned the RAC denial for three of the four claims, thereby reversing the denial and granting Medicare coverage for the inpatient services, as filed. The fourth claim, however, was a more sticky situation.

While the ALJ agreed with the RAC and denied the coverage for the inpatient services provided as billed on the fourth claim, the ALJ nevertheless found that “the observation and underlying care are warranted.” In other words, yes, the inpatient admission was not warranted, but the observation and other outpatient services were warranted and should therefore be paid by CMS, even though the services were never billed as such. Or, put another way: “down-code” the claim to Part B services and pay those.

The net effect was to reduce the recoupment to simply the difference between the Part A and Part B services provided for the fourth claim only, compared to complete recoupment of all four inpatient claims, as the RAC originally decided.

Even without knowing the exact figures involved, this all suggests that CMS may have lost money on the entire process — they had to return all monies recouped, less the difference noted, but the RAC got to keep their entire commission/fee/bounty, per their contract with CMS.

Of course, while the provider got back almost all their reimbursements for the four claims, they still had to pay legal fees out of their own pocket. Considering the time involved, these were likely not insignificant.

Without reviewing all the documents here, we do wish to note a few things we think providers should consider about these decisions, regarding potential strategies for RAC appeals:

First: Bring these decisions to the attention of your legal counsel. Providers should bring both these  decisions to the attention of their legal counsel, and their RAC Team.

Second:  In Part A Medical Necessity Denials, fight for reimbursements for Part B services, if provided. Medical necessity reviews have not yet been approved for RACs, but they are likely to begin at any time. Although the O’Connor case was a result of a RAC Demonstration project denial, the Medicare Appeals Council decision is at least the second time that the Council has reminded CMS that they in fact have current policies in place that not only say that such claims should be paid as described in these cases (unbilled Part B services are sometimes payable when Part A is denied), but that CMS even instructs contractors to do exactly that. These cases offer good reason to believe the Council will render decisions in the future that are consistent with these two.

Third: In such cases, refile for Part B services as provided. The date for “refiling” a claim under such circumstances could be difficult to determine, but may depend upon what the Medicare Appeals Council considers as “new evidence” — which, at least in the case of the UMDNJ appeal, could be inferred from the fact that the contractor reached a denial decision and informed the provider of same, thereby supplying the provider with “new evidence.” Even without such a date for “reopening” the file, in the case of the O’Connor appeal, the Council found that the time limit is simply the end of the entire process, its “finality.”

Fourth: Familiarize yourself with these decisions. The Council cites several documents that are important to the decisions.

The documents cited can all be found HERE on www.myedutrax.com in our Documents Section.

Connolly Adds Yet Another 25 New Issues

Several with High Rankings, High Dollar Value

Connolly Healthcare, the RAC for Region C, posted 25 new DRG Validation Issues to their list of CMS-Approved audit issues, on Tuesday, March 16. Once again, Connolly has been approved for even more MS-DRGs with high Relative Weights (which equates to high dollar reimbursements) and high claim volumes (which equates to large number of claims to potentially audit).

Three (3) of the newly approved issues are for MSDRGs with Relative Weights of better than 5.0.  Also, six(6) of the 25 new issues are ranked (by number of discharges)  in the top 100 DRGs nationwide.

This latest round of approval/postings seems to continue a pattern we have previously noted here. (See our post from February 9.)

Noteably, the states of Virginia and West Virginia are still absent from the list of states affected or approved for any of these issues. The 13 states affected by these approved issues are: Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma, South Carolina, Tennessee, Texas.

The List

Below are the new posted and approved audit issues for RAC Region C:

  1. MS-DRG 226: Cardiac Defibrillator Implant without Cardiac Catheterization with MCC 
  2. MS-DRG 415: Cholecystectomy Except by Laparoscope without C.D.E. with CC 
  3. MS-DRG 237: Major Cardiovascular Procedures with MCC or Thoracic Aortic Aneurysm Repair 
  4. MS-DRG 969: HIV with Extensive O.R. Procedure with MCC 
  5. MS-DRG 933: Extensive Burns or Full Thickness Burns with Mechanical Ventilation 96+ Hours without Skin Graft 
  6. MS-DRG 239: Amputation for Circulatory System Disorders Except Upper Limb and Toe with MCC 
  7. MS-DRG 934: Full Thickness Burn without Skin Graft or Inhalation Injury 
  8. MS-DRG 243: Permanent Cardiac Pacemaker Implant with CC 
  9. MS-DRG 246: Percutaneous Cardiovascular Procedure with Drug-Eluting Stent with MCC or 4+ Vessels/Stents 
  10. MS-DRG 253: Other Vascular Procedures with CC 
  11. MS-DRG 749: Other Female Reproductive System O.R. Procedures with CC/MCC 
  12. MS-DRG 803: Other O.R. Procedures of the Blood and Blood-Forming Organs with CC 
  13. MS-DRG 823: Lymphoma and Nonacute Leukemia with Other O.R. Procedure with MCC 
  14. MS-DRG 315: Other Circulatory System Diagnoses with CC 
  15. MS-DRG 617: Amputation of Lower Limb for Endocrine, Nutritional, and Metabolic Disorders with CC 
  16. MS-DRG 829: Myeloproliferative Disorders or Poorly Differentiated Neoplasms with Other O.R. Procedure with CC/MCC 
  17. MS-DRG 486: Knee Procedures with Principal Diagnosis of Infection with CC 
  18. MS-DRG 941: O.R. Procedure with Diagnoses of Other Contact with Health Services without CC/MCC 
  19. MS-DRG 577: Skin Graft and/or Debridement Except for Skin Ulcer or Cellulitis with CC 
  20. MS-DRG 358: Other Digestive System O.R. Procedures without CC/MCC 
  21. MS-DRG 133: Other Ear, Nose, Mouth and Throat O.R. Procedures with CC/MCC 
  22. MS-DRG 424: Other Hepatobiliary or Pancreas O.R. Procedures with CC 
  23. MS-DRG 616: Amputation of Lower Limb for Endocrine, Nutritional, and Metabolic Disorders with MCC 
  24. MS-DRG 675: Other Kidney and Urinary Tract Procedures without CC/MCC 
  25. MS-DRG 717: Other Male Reproductive System O.R. Procedures except Malignancy with CC/MCC 

To see the complete original listings (on the RAC websites), visit this page.

Or, to find a more useful listing of all their posted issues, visit  this page on eduTrax.  (Registration required.)

Still No Medical Necessity Reviews

All of the above approved issues still include this caveat:

(At this time, Medical Necessity excluded from review).

We again remind everyone that Medical Necessity Reviews could be approved by CMS at any time now, since the CMS RAC Review Phase-In Strategy allows for such audits in calendar 2010.

Stay tuned, as the situation unfolds.

RAC Record Request Letter from Connolly (Region C)

Below is a link to an Additional Documentation Request Letter (ADR) letter from Connolly to a hospital in Georgia. It only requests 5 records, but is only the first they’ve received, and is dated Feb 25, 2010.

Download this letter, HERE.

Here are a few things we’ve noted about the letter:

DRG Validations for the following MSDRGs –

  • MSDRG 981 – OR Procedure unrelated – RW 5.04, Rank 134, ALOS 14.6 – claim shows 7 day stay.
  • MSDRG 386 – Inflammatory Bowel Disease – RW 1.04, Rank 343, ALOS 5.4 – shows 6 day stay.
  • MSDRG 574 – Skin Graft &/or Debridement – RW 1.91, Rank 352, ALOS 8.9 – shows 5 day stay.
  • MSDRG 574 – Skin Graft &/or Debridement – RW 1.91, Rank 352, ALOS 8.9 – shows 4 day stay.
  • MSDRG 357 – Other Digestion System OR Procedure – RW 2.12, Rank 468, ALOS 7.7 – shows 3 day stay.

Abbreviations used, above:

  • OR = Operating Room
  • RW = Relative Weight for reiumbursement
  • Rank = nationwide rank, reported by CMS, by number of discharges in FY09 (#1 = highest)
  • ALOS = Average Length of Stay in days

In the letter, note that the Rationale for each DRG Validation mentions that “the RAC Demonstration … found an overwhelming majority of errors in assignment… resulting in overpayments to hospitals.

The letter then goes on to state: “The RAC identified errors in the data that could be traced to the hospitals’ medical record practice. An analysis of your billing data indicates that a potential aberrant billing practice may exist for this DRG.

Interesting wording… note the use of “hospitals‘” (plural); and “your billing data” — the letter does not make clear what analysis the RAC really did.

Region C RAC Adds 19 New Issues

Connolly Posts 19 New DRG Validation Issues

February 9, 2010 — Connolly Healthcare, the RAC for Region C (south & southeastern states), posted 19 new approved issues for review on their RAC Issues page, on Monday, February 8, 2010. Following the format they have been using to date, the listed issues include only single MS-DRGs, but are still not listed in any particular order.

All of the new issues are approved for DRG Validation, affecting all thirteen of the Region C states (AL, AR, CO, FL, GA, LA, MS, NM, NC, OK, SC, TN, TX).

Top Ranked, High Dollar DRGs Added

Give their demonstrated proclivity to review high-dollar DRGs, these additions are not surprising, coming from Connolly.

See our recent analysis done for RAC Monitor, HERE.

We will shortly post another analysis of their approved issues list, analyzing the posted issues by DRG Relative Weights and by DRG Rank (in terms of the number of discharges, nationwide). Of the 52 DRGs with Relative Weights of better than 5.0, Connolly just added four (4) more to their list. Six(6) of the 19 new issues are ranked (by number of discharges)  in the top 100 DRGs nationwide.

Three States Added to Previously Posted Issues

Notably, Arkansas, Lousiana and Mississippi were added to the states affected lists for all previously approved DRG Validation issues, now bringing them fully under the magnifying glass of the RAC. These three states were added to the posted DRG Validation issues on February 2.

Still No Medical Necessity Reviews

None of the posted issues are approved for review of Medical Necessity, and such reviews do not appear to have been approved for any of the RACs, to date. However, it is likely that the existing DRG Validation issues will all be approved for medical necessity review in short order, since the CMS RAC Review Phase-In Strategy allows for such approvals in calendar 2010.

More Useful Lists Available

Find links to all the RAC New Issues Pages here. For more useful lists, see below.

Use the links below to see details of the newly posted issues, in our database (Editor’s Note: this list appears here in the reverse order as posted by Connolly):

1 MS-DRG 208: Respiratory System Diagnosis with Ventilator Support
2 MS-DRG 038: Extracranial Procedures with CC
3 MS-DRG 227: Cardiac Defibrillator Implant without Cardiac Catheterization without MCC
4 MS-DRG 240: Amputation for Circulatory System Disorders Except Upper Limb and Toe with CC
5 MS-DRG 242: Permanent Cardiac Pacemaker Implant with MCC
6 MS-DRG 957: Other O.R. Procedures for Multiple Significant Trauma with MCC
7 MS-DRG 344: Minor Small and Large Bowel Procedures with MCC
8 MS-DRG 488: Knee Procedures without Principal Diagnosis of Infection with CC/MCC
9 MS-DRG 533: Fractures of Femur with MCC
10 MS-DRG 216: Cardiac Valve and Other Major Cardiothoracic Procedures with Cardiac Catheterization with MCC
11 MS-DRG 460: Spinal Fusion Except Cervical with MCC
12 MS-DRG 248: Percutaneous Cardiovascular Procedure with Non Drug-Eluting Stent with MCC or 4+ Vessels/Stents
13 MS-DRG 222: Cardiac Defibrillator Implant with Cardiac Catheterization with Acute Myocardial Infarction/Heart Failure/Shock with MCC
14 MS-DRG 201: Pneumothorax without CC/MCC
15 MS-DRG 945: Rehabilitation with CC/MCC
16 MS-DRG 470: Major Joint Replacement or Reattachment of Lower Extremity without MCC
17 MS-DRG 885: Psychoses
18 MS-DRG 291: Heart Failure and Shock with MCC
19 MS-DRG 189: Pulmonary Edema and Respiratory Failure

Find a list of all their posted issues HERE.  (Registration required.)

CMS Expands RAC Records Requests Limits

Limits Now Apply to All Institutional Claim Types, Not Just DRG Validations

The Centers for Medicare & Medicaid Services (CMS) modified its FY2010 Additional Documentation Request (ADR) Limits, expanding the scope of the rule to include all institutional providers, on January 28, 2010. Previously, the rule applied to ADRs for DRG Validation issues only, as posted by CMS on December 1, 2009, and would have only applied to Medicare Part A providers. CMS also indicated that more changes are yet to come, with rules applying to physicians and other types of providers, including DME suppliers.

The December posting indicated that there would be two “caps” made on RAC ADRs, during FY2010. Through March 2010, the cap would remain at 200 ADRs per 45 days for all providers/suppliers. However, from April through September 2010, providers/suppliers who bill in excess of 100,000 claims to Medicare, across all claims processing contractors, would have a cap of 300 ADRs per per 45 days.

These limits would apply per “campus” instead of per NPI (National Provider Identifier). The definition of a campus is CMS’s new method of calculating limits, and is based on providers’ Tax ID Numbers plus the first three numbers of the ZIP code where those provider entities are physically located.

This most recent posting does not change any of the previous limits or definitions, but does expand the rule to apply to all claim types, not just DRG Validations.

Read the new document  HERE , along with a copy of the text from the December document.

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