News to Note – December 2022

• The Centers for Medicare and Medicaid Services (CMS) recently released the 2023 outpatient and physician rules and 20 times in the physician rule, CMS used the words “observation status.” Also, they used the proper term, “observation services,” only 19 times. They know that observation is a service provided to outpatients and not a status. In fact, they have recouped money from providers who billed for observation services when it was inappropriate. This results in a big *sigh* from all of us across the country. 
• It looks like we will be seeing another 90-day extension to the public health emergency in January since HHS did not issue their promised 60 day notice last month. From the provider side, it also means that those many patients who gained health insurance because of the Medicaid expansion will continue to have that coverage and while Medicaid does not pay well, a little reimbursement is better than nothing.
• Last month, it was reported that a health system had some of their total joint replacements audited by recovery auditors and they were denied based on lack of medical necessity. What was missing? The Recovery Audit Contractor (RAC) was unable to find the radiologist’s interpretation of the x-ray to confirm the presence of radiographic evidence of arthritis. This is a problem because it’s not a requirement in any Local Coverage Determination (LCD) or guideline and it is not even the standard of care. In most cases, the patient sees the orthopedic surgeon in the office and x-rays are performed at that time. The orthopedic surgeon then interprets the x-rays and documents the findings in the office note along with the other clinical information. All that information is used to determine the need for surgery. Orthopedic surgeons are qualified to read bone imaging and there is no reason in the office setting for the images to be sent to a radiologist for interpretation. In fact, to do so would result in an additional claim to Medicare which could be viewed as a medically unnecessary service and ultimately denied. If this happens to you, do not accept the denial. If the orthopedic surgeon documented the findings, even if it is simply within the body of the office note, and the findings demonstrate advanced joint disease, keep appealing.
• WPS Government Health Administrators released a summary of Comprehensive Error Rate Testing (CERT) findings of total joint replacements but in this case, they looked at the admission status. To quote WPS, the CERT found that “Inpatient stay was not reasonable and necessary as there were no documented perioperative complications or documentation to support medical necessity for a stay past the first midnight. The procedure can be safely performed in an outpatient setting.” However, that is not what the regulations say. The admission decision is not based on the occurrence of complications but the risk of complications. A clinically supported and properly documented one midnight inpatient admission for surgery is perfectly compliant if higher risk exists.
• At some point HHS is going to stop renewing the COVID-19 public health emergency (PHE). When that happens, there will be some major changes and it is going to be a billing, compliance, and audit mess. Why? Because the end of the PHE does not mean the end of all the waivers. For example, the 2023 rules will allow telehealth to continue for mental health services with no expiration. HHS has already indicated that most of the other telehealth waivers will continue to be in effect for 151 days after the end of the PHE. On the other hand, when the waiver expires, the waiver of offering patient choice and having Utilization Review (UR) Committee meetings ends immediately, despite the fact that some surveyors think those waivers ended in 2021. And, both skilled nursing facilities (SNFs) and inpatient rehabilitation facilities (IRFs) can use waivers to accept patients who normally would not qualify based on the three-day inpatient rule and the three-hour rule, respectively. But, while those waivers will end immediately, the patient will continue to have coverage under the waiver throughout their stay. To add to the confusion, the waivers also allow physicians supervising cardiac and pulmonary rehabilitation to provide that supervision remotely. But, CMS decided to extend this flexibility to the end of the calendar year in which the waiver expires. So, keep an eye on the audits and ensure they apply the right rules for the situation. 
• There was a recent, interesting Department of Justice settlement with New York Presbyterian Hospital. The hospital discovered that a physician was changing implanted defibrillator batteries before they were due to exchange. An ICD battery exchange is more complex than changing the batteries in a flashlight but probably not as complex as changing the battery in your iPhone, but in any of those cases, there is no indication to change a battery that is operating properly. The physician scheduled the procedures and the hospital billed Medicare for 115 such patients. As a result, the hospital paid a $2.5 million fine. When we discuss screening for medical necessity, I am not sure battery replacement would make anyone’s top ten list but if it could happen to them, if could happen to you. Remember, there must be medical necessity for every single service.