Editor’s Note

Enough Is Enough

Two years have demonstrated that CMS’s audit madness needs to stop.

• By David Kopf
• Jun 01, 2012

They say the definition of insanity is doing the same thing over and over again while expecting different results. Welcome to the land of Medicare claims audits. On a near daily basis I get calls and emails from providers absolutely exasperated over the intensity and seemingly arbitrary nature of pre- and post-payment audits on Medicare claims. They are bending over backwards to accommodate the program, and being rewarded with nothing but pain and suffering.

It might sound brusque to say it, but this current misery shouldn’t come as a surprise. Back in 2010, various experts were warning that the most immediate and dangerous threat to the home medical equipment industry was not competitive bidding, but rather CMS’s stepping up of audits. Not only were the audits extensive, but CMS was putting considerable capital behind them.

During the fiscal year of 2010, CMS invested $311 million in its program integrity, which was a 50 percent increase from 2009’s outlay. In 2011, providers felt the effect of that investment in a bad way. Claims dating back to October 2007 were subject to recoupment, and providers facing prepayment audit could have 100 percent of their incoming claims reviewed before payment. CMS estimated it would recover $10.4 billion this year, an attractive sum to the agency and Congress, who are both fixated on cutting costs at all costs.

The resulting ramp-up in Recovery Audit Contractors (RAC), Comprehensive Error Rate Testing (CERT) and Zone Program Integrity Contractors (ZPIC) audits has served up a financial tsunami for many providers, particularly small ones that cannot survive having so much funding held in limbo. With budgets already in disarray from so many other Medicare funding cuts, the audits can close a business, or at the very least, involve so many claims that it is nearly impossible to build an effective strategy for dealing with them.

So, providers have been implementing rigid documentation requirements that require the complete and correct medical documentation from all referral partners, before they can process their claims. And, most providers are conducting internal audits to ensure their claims are clean and all departments are living up to the documentation requirements of the business. Also they have been actively educating their referral partners proactively explain to them the Medicare requirements and why they need to do what they are doing in an attempt to ensure good documentation while preserving relationships with those partners.

Now, we make a regular effort to include coverage of audits in the magazine and online, and try to provide the sorts of coverage that can help providers prepare for audits, implement solid documentation processes, and generally insulate themselves from the problem as best they can, but as much as I think the ideas those stories offer can help providers, they’re the proverbial finger in the leaky dike. Providers need to go further regularly lawmakers to urge CMS to rein in this broken program.

And we have another perfect opportunity to do that: Six members of the Senate Finance Committee, led by ranking member Sen. Orrin Hatch (R-Utah), have launched a bipartisan effort to solicit ideas from the healthcare industry on how to combat waste, fraud, and abuse in the Medicare and Medicaid programs. This is an ideal opportunity for providers to tell the committee exactly how dysfunctional the program is. The committee invited providers and other stakeholders to submit white papers offering recommendations and innovative solutions to improve program integrity efforts, strengthen payment reforms, and enhance fraud and abuse enforcement efforts. Submissions are due by June 29. Those submissions will be compiled into a summary document highlighting key proposals will be compiled and released later this year.

Make sure to submit a white paper via email as a PDF or Microsoft Word document attachment to [email protected]. The white paper should include summary information about the entity or individual submitting a white paper, as well as phone and email contact information. White papers should be as succinct and concrete as possible, and when possible, should include cost-benefit or potential savings information. Keep it straightforward and numbers-driven, and the lawmakers and their staffs will hopefully pay attention.

Don’t miss this chance to stop the insanity.

This article originally appeared in the June 2012 issue of HME Business.