Assessing CMS's Audit Ramp-up
Providers will see an increase in claims audits from Medicare and other funding sources in 2022. Audit expert Wayne van Halem offers insights into what they can expect for this year.
- By David Kopf
- Feb 01, 2022
The New Year has arrived, and CMS’s audit game plan
has started to come into focus. In June 2021, CMS indicated that it
intended to audit claims filed during the COVID-19 pandemic but
held off on eventually implementing that plan. Instead, it focused
on claims for items that didn’t impact the country’s Covid-19
response, such as wheelchairs and incontinence items.
CMS appears to no longer be hesitating on those audits. The
agency is quickly expanding audit programs, and it’s important for
providers to understand how that will unfold. To help, audit expert
Wayne van Halem, president and founder of the audit consulting
firm The van Halem Group (vanhalemgroup.com), sat down with
HME Business to share his insights into CMS’s plans.
Shifting into High Gear
“We are definitely seeing an increase in audit activity across the
board, and not just with Medicare audits,” van Halem says.
Those increases include audits in Medicaid and managed care
plans. Also, van Halem notes his firm has clients that are undergoing
audits on equipment that were part of the waivers during the public
health emergency, with dates of service during the PHE and had CR
modifiers on there. While CMS might have said that it would resume
claims audits gradually, it’s now shifting into a higher gear.
“We’re seeing audits for even respiratory equipment now,” he
says. “So they’re definitely back. What we haven’t seen yet is how
they’re going to handle the CR claims, particularly for respiratory
equipment, because there are no LCDs that were in effect, those
requirements were waived,” van Halem adds. “So we’re waiting
very patiently to try to see what that outcome is.”
So, with no LCDs in place and waivers on claims, how did
experts like van Halem advise providers to handle the situation?
“The advice that we generally gave our clients is, if you can get
the documentation, please try to do that,” he says. “If not, then our
counsel is to remember that the purpose of the waivers was to help
people access equipment that they needed so that providers can
help free up space in hospitals and get these patients home where
they’ll be safe. And in the spirit of the purpose behind it, then yes,
they utilize the flexibilities and put the equipment out.”
So, If a provider had the standard written order and the information
from the doctor showing why the equipment was needed for
the patient, then the advice was to proceed with the claim and use
the CR modifier accordingly, van Halem says.
“So that was our advice,” he says. “And now, those are the first
claims that we’re seeing getting audited. So I am really curious to
see how that pans out.”
To help, van Halem says that his firm has reminded the auditors
it is working with to take into consideration that the PHE flexibilities
were in place and that LCD requirements didn’t apply.
“I can’t imagine they won’t,” he says. “If they don’t, then we’ll
certainly be getting CMS involved in it because that was the
instructions from CMS to the contractors during that period.”
Other Payers & The ALJ Backlog
It’s not just Medicare that is expanding its audits; Medicaid and
managed care programs are also ramping up their claims audits.
“Very similarly, we have some managed care plans on the Medicaid
side, in various states that are auditing suppliers on respiratory
equipment that was provided during the pandemic,” van Halem
reports, adding that not all the state programs get to make their
determinations on their own. Some state Medicaid and managed
care programs kept their Covid-19 waivers for audits on items such
as respiratory devices in place while some ended them earlier. Also,
some of them still have waivers in place, but are also auditing.
Interestingly enough, the commercial plans never really subsided
during the pandemic.
“So even when Medicare had seized all audit activity, we still
had clients that were receiving audits from commercial plans,”
van Halem notes. “And that seems to be consistent continued
throughout the public health emergency.”
Lastly, another factor that will cause an increase in audits is the
reduced backlog in cases being heard by Administrate Law Judges
at CMS’s Office of Medicare Hearings and Appeals.
“It’s getting resolved a lot sooner than we had anticipated,” van
Halem notes. “Those ALJs are staffed to handle about 300,000
appeals a year, and currently, they’re only receiving about 35,000
a year. And the only way to get more appeals in the workload is to
do more audits.
“So I’m really concerned and watching that backlog to see what
CMS’s response to that is,” he continues. “We have a feeling that
they’re going to utilize the RAC program to increase that workload.
… So, we’re going to be watching that very closely.”
Free Audit Webinar
Want to get a full assessment of how audits will impact providers in
2022? On Feb 10, 2022 van Halem presented an HME Business webinar
outlining 2022’s audit trends and how providers can contend with
them that is now available online as a free archive.
Topics addressed in the webinar:
- Potential audit strategies that CMS might implement
- What to anticipate with RAC, TPE, and SMRC audits in 2022.
- Strategies a supplier can implement to mitigate audit risk.
Thanks to sponsorship from Prochant Inc. and TeamDME!,
registration to watch the archived webinar and download materials
is free at HME-Business.com/webinars.
This article originally appeared in the Jan/Feb 2022 issue of HME Business.
David Kopf is the Publisher HME Business, DME Pharmacy and Mobility Management magazines. He was Executive Editor of HME Business and DME Pharmacy from 2008 to 2023. Follow him on LinkedIn at linkedin.com/in/dkopf/ and on Twitter at @postacutenews.