All skilled nursing facilities that participate in Medicare Fee-for-Service (FFS) can expect a letter from the Centers for Medicare & Medicaid Services (CMS) regarding improper payment rates starting June 5.
And, as of an updated memo from CMS on Monday, claims could be adjusted or denied if an improper payment is identified. CMS initially posted publicly about the decision on May 4, then briefly made the information confidential last week.
The move is in reaction to data compiled using the Comprehensive Error Rate Testing (CERT) program, which projected an improper payment rate of 15.1% in 2022 for FFS – nearly double compared to 7.79% in 2021.
“If you look at who the primary group responsible for overpayment is when you’re looking at hospitals, hospice, home health, and hospital/outpatient in skilled nursing facilities, you can see that [SNFs’] rate here is much higher than the other entities,” said Alicia Cantinieri, vice president of MDS policy and education for Zimmet Healthcare Services Group. “That’s why they’re looking at us.”
Improper payment rate is a measure of payments that don’t meet the Medicare requirements for whatever reason, she said. It’s not the same thing as fraud rate.
Zimmet, in partnership with Simple, hosted a webinar Monday on the improper payment probe, which included advice on how SNFs can spot errors through internal audits.
Cantinieri said the massive increase was partially explained by CMS as fallout from the transition from RUG-IV to Patient Driven Payment Model (PDPM), but that’s not the “whole reason.”
Insufficient documentation really jumped out as a primary reason for improper payments among SNFs, she said. Looking at a case mix group, Cantinieri pointed out component documentation missing, including paperwork to support the crucial Section GG of the MDS.
“You can have a diagnosis in the medical record, but the MDS itself has specific requirements before you can code it there,” said Cantinieri.
All SNFs are up for review – and payment could be adjusted
Given skyrocketing improper payments in the sector, CMS will have its auditors conduct reviews of five claims per SNF – providers with an error rate of 20% or less will receive education of some kind, while those with an error rate greater than 20% will receive one-on-one education with a Medicare Area Contractor (MAC).
“Provider education is going to be based on any identified errors,” said Cantinieri. “This one is a prepayment review, unless the provider requests a post-payment review due to financial burden.”
In other words, SNFs will have the opportunity to shift this process to post-payment review within the letters sent by CMS, Cantinieri noted.
Cantinieri went through highlights of the memo for listeners:
- MACs will select five claims from each SNF in their jurisdiction.
- The directive is focused on Part A PDPM claims to increase comprehension of correct billing practices.
- MACs will complete one round of “probe and educate” rather than the usual three rounds, per the existing Target Probe and Educate (TPE) program.
- Provider education will be based on identified errors.
- Prepayment review.
“They are going to send a letter whether there are any findings or not,” said Cantinieri. “It’s most likely going to be widespread education. Now 20% or less is one claim out of five. That’s not a huge margin for error when there’s only five claims.”
Providers already under a TPW audit are exempt from these five claim reviews, Cantinieri added.
“If you’re already under a TPE, or one of the smart audits, the supplemental Medicare review contractor, those facilities will be excluded,” said Cantinieri. “They’re already being audited by someone else.”
If a claim containing a possible Covid diagnosis falls under the public health emergency dates, those will be excluded as well “when possible,” she added.
Rolling reviews
MACs were directed to start with providers that show the highest risk – but CMS didn’t exactly say what the risk factors would be, Cantinieri said during the webinar.
Providers could look at certain areas of the MDS for risk, Cantinieri said, or where most of a facility’s errors lie. Often these errors can stem from wrong coding, or a documentation issue.
“You want to conduct some internal audits, it goes without saying, but the person who completes the MDS shouldn’t be the one doing the internal audit,” she said. “You want to have a fresh pair of eyes looking at that.”
Benchmarking and analyzing data ahead of June 5 is a good idea in order to target and train staff on clinical reimbursement process improvement.
“This could include your clinical team, and it might also include your medical team, because as far as diagnoses go, your medical team is key here,” said Cantinieri. “If they’re not doing their documentation, or they’re not doing it in a timely manner, you may have to reach out and train them as well.”
Another tip – thorough documentation. Given most improper payments were tied to documentation errors, that’s not a surprise, she said.
Zimmet unveiled a proprietary risk profile assessment tool as well during the webinar to help SNFs determine how far up the list they are.
SALT, or statistical analysis of likely target reports, takes into account the PDPM rate component associated with the target area being measured and specific PDPM reimbursement sensitive items being measured by CMS, among other criteria.
“We want to understand that data profile, where you’re flagging high to know where your risk areas are,” noted Cantinieri. “It doesn’t mean you’re doing anything wrong, but it’ll keep you ahead of the game.”
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