News to Note – February 2020

• Early in the month during an open call, National Government Services (NGS) took the targeted probe and educate audits to an area one would never expect, the proper completion and delivery of the Medicare Outpatient Observation Notice (MOON), the CMS-mandated notice to observation patients. They decided that if the MOON is not completed properly or delivered within the proper time frame that all the observation hours should come off the claim and hospitals wouldn’t even get the Observation payment.  But, a week later, CMS stated that removing hours from the claim is not permitted.  NGS should be going back and reprocessing claims they recouped.  If you had any cases reviewed, call NGS and tell them CMS said this was not permitted.
• Recovery Audit Contractors (RACs) have asked CMS for permission to start auditing short inpatient admissions.  But, it is not just any admission, it is those patients admitted as inpatient for stem cell or bone marrow transplants.  The rationale for their request is not given but it’s suspected it dates to an Office of the Inspector General (OIG) audit in 2016 which found a 93% error rate and a Supplemental Medical Review Contractor (SMRC) audit in 2017 which had an 86% error rate.  Keep in mind, this is not about the need for the transplant, it’s about the status of the patient.  As with many procedures, doctors have gotten much better at these transplants.  Many of us probably picture the patient who is locked in isolation for weeks, with every visitor covered from head to toe.  But today, many patients can get their infusion of bone marrow or stem cells and go home after a day with daily visits to the clinic to monitor them.  It is these patients that the audits are targeting because of course, their admission lasts under two midnights.  When billed as an inpatient admission, the corresponding DRGs have geometric mean length of stays of 5 to 13 days so one could see that a one-day length of stay would stand out.  And, the transplant HCPCS code is not on the inpatient-only list.  That means the Two-Midnight Rule does apply and if the plan is a one-day stay, that’s default outpatient.  Will CMS will approve this RAC request?  If they do, will other short-stay RAC audits be forthcoming?  We’ll be watching closely.
• A little background about the QIOs: Originally, each state had a QIO that handled all the QIO duties. But in 2014, CMS decided that it didn’t make sense that the same organization which partnered with hospitals to improve quality would also be the organization to investigate the hospital if there was a complaint about quality.  CMS separated the duties, giving the patient appeals, high-weighted DRG, and quality complaints to two national organizations now called the Beneficiary and Family-Centered Care (BFCC) QIOs.  In mid-2019 there was a realignment of the QIO areas and new contracts were awarded.  Many will remember that there were significant delays in processing appeals by KEPRO who claimed that they did not anticipate the volumes they received.  Hospitals around the country are reporting that it is taking up to a week for the QIOs to return decisions on appeals of patient discharges.  What’s the issue this time?  It appears CMS now requires the QIOs to process all appeals through a system called Quality Management and Reviews System (QMARS).  The program, rolled out 18 months ago, only became mandatory for beneficiary appeals as of last month and that is when the finger pointing started.  The QIOs were quick to blame CMS for the issues.  CMS pointed out that the system has been in place for 18 months and perhaps the QIO staff was not using the system properly.  QIOs suggested the hospitals were at fault for not using the bar code page as the first page when they faxed medical records, which, by the way brings up the issue that health care is the only industry that still uses fax machines.  When a patient files an appeal, they get to stay in the hospital for as long as the appeal takes.  The hospital gets no additional revenue and an acute care bed is being occupied while a patient who actually needs hospital care may be boarding in the ED getting care on a hallway gurney.  It’s important to remember that over 90% of appeals are decided in favor of the hospital so it’s not as if hospitals are kicking sick people out before they are ready.  Every time you have a beneficiary appeal that is delayed, send an email to CMS at [email protected] expressing your anger but don’t include PHI.  Then, consider calling your state hospital association to tell them to get involved. 
• The RACs are currently approved to audit 163 issues.  If you find they have made an error, such as using an outdated definition of malnutrition in their DRG validation audits, or if they miss a deadline, report it to CMS at [email protected].