Audit Bill in the Works

Legislation would limit documentation look back periods; require timely filing limits; create education program.

Jay Witter, vice president of Government Affairs for the American Association for Homecare, discussing Rep. Renee Ellmers' (R-N.C.) nascent audit legislation with attendees of the VGM Group’s Heartland Conference, which was held June 9 through 12 in Waterloo, Iowa.

The American Association for Homecare, the North Carolina Association for Medical Equipment Services, and industry legislative experts are working with Rep. Renee Elmers (R-N.C.) to draft legislation that would reform CMS’s current audit efforts directed at HME providers.

Elmers is a key lawmaker to be engaged in this effort, given her membership on the Hosue Energy and Commerce Committee, her background as a nurse, and her work on behalf of the industry, said Jay Witter, vice president of Government Affairs for AAHomecare, during a legislative update at the VGM Group’s Heartland Conference held June 9-12 in Waterloo, Iowa.

“She knows healthcare and she knows DME,” he noted. “She wants to help out with audits, and particularly with DME audits.”

Originally focused on DME, discussions on the bill are likely to expand the legislation’s coverage to the “POS” portion of DMEPOS so that providers of items such as prosthetics, orthotics, diabetic shoes and insulin pumps can be involved. To that end, AAHomecare has met with the American Podiatric Medicine Association and other groups to broaden the bill’s support.

The legislation will not focus on any specific audit program, such as RACs, but will cover the entire gamut of Medicare claims audits impacting DMEPOS providers.

A key element of the legislation will be an Improper Payment and Outreach Education Program. The goal of this item would be to prevent problems by ensuring providers understood what’s required of them, Witter explained.

“If they teach about how to reduce error rates, they have to tell you what the rules are,” Witter said. “The rules right now are so unclear. … “If [providers] knew the exact rules, I guarantee they’d follow them.”

The education portion of the bill would force CMS and its contractors to specifically outline claims and documentation rules and requirements and educate providers on what they are. This effort will involve outreach, education, training and technical assistance.

Another component of the bill would be to require audit contractors to target their efforts on suppliers that are prone to high errors rates and to reduce the number of audits directed at providers that have lower errors rates. This will incentivize providers to reduce their error rates.

The bill would also reinstate clinical inference and clinical judgment in the audit process. Whitter noted that clinical inference and judgment were used to determine if claims should be paid until 2009, and the error rate was 7 to 8 percent.

“Even though there might have been a comma out of place or the date was a little bit off, they could look at it and say, ‘Well, this patient really needs this equipment; we’re going to pay it,’” Witter explained. “CMS took that away.

“This  legislation would require that [contractors] look at clinical judgment and clinical inference when they’re looking at audits,” he continued. “That’s going to significantly reduce error rates.”

The bill would also limit the documentation look-back period for three years, and would require application of timely filing limitations to claims subject to payment audits. For items that are paid on a monthly rental basis, an audit on a claim could jeopardize  all the payments, and by the time the provider overturns that audit, it’s too late.

“These are sound reforms that will make the system more efficient, more fair, and it will expose everything,” Witter said, highlighting the point about transparency by noting that Medicare isn’t wasn’t aware of the overturn rates for DMEPOS audit appeals when asked. “All this should be open.”

About the Author

David Kopf is the Publisher and Executive Editor of HME Business and DME Pharmacy magazines. Follow him on Twitter at @postacutenews.

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