Rehabilitation Facilities Tackle RA Complexities
By Lisa A. Eramo
For The Record
Vol. 27 No. 5 P. 20
A popular target among auditors, IRFs must document meticulously and abide by strict deadlines.
With their high-dollar claims and complex documentation requirements, inpatient rehabilitation facilities (IRFs) have always been low-hanging fruit for recovery auditors (RAs). In fact, RAs have targeted IRFs since the original demonstration project in 2005 during which nearly $60 million was collected from IRF denials, according to a 2008 evaluation of the three-year project.
Over the years, IRFs have continued to see their fair share of audits. "It's probably not more volume-wise than an acute care hospital, but the claims in the IRF are worth much more," says Emily Morgan, a hospital appeal and denial specialist at RehabCare, a division of Kindred Healthcare in Louisville, Kentucky, who adds that one IRF claim alone could yield as much as $30,000 or more.
Morgan, who handles the RA response and appeal process for IRFs nationwide, is aware of at least one facility that had a total of $10 million in billed charges reviewed by an RA over the course of six months. A total of 600 claims were denied. Although this particular IRF has overturned more than one-half of the denials, the rest remain pending at the Administrative Law Judge level, tying up valuable resources on which the facility relies, she says.
Inpatient acute rehabilitation units within larger hospitals have sometimes seen the worst in terms of the volume of requests, says Ronald S. Connelly, JD, principal at Powers, Pyles, Sutter, & Verville, PC, a law firm that assists IRFs with appeals, including handling the entire appeals process and training staff on how to write a persuasive appeal letter.
Although RAs have been subject to a cap on the number of records they could request from a hospital every 45 days (based on the hospital's volume), rehab units often found themselves shouldering the brunt of these audits based on their compliance vulnerabilities, Connelly says. "The RA would apply the whole institution's medical record limit on that one subcomponent, which could really bury the IRF unit," he says.
Complicated documentation requirements make it more difficult for IRFs to produce a complete and timely record, says Angela M. Phillips, PT, president and CEO of Images & Associates, which provides consulting, resources, and tools to rehabilitation providers. "IRFs have a full set of rules over and above what is required for the hospital," she says.
Dealing With Documentation Galore
It's no surprise that IRFs have struggled with audits since the beginning of the RA program. The Medicare Benefit Policy Manual, Chapter 1, Section 110—last updated in 2010—includes more than 10 pages of strict documentation requirements, many of which include deadlines that are triggered the moment the patient is admitted to the IRF. Medical necessity requirements for IRF services are also complex. To satisfy medical necessity—more commonly referred to as "reasonable and necessary" requirements—IRF patients must meet the following criteria:
• require multiple active and ongoing therapies, one of which must be physical or occupational therapy;
• require intensive rehabilitation therapy generally consisting of at least three hours of therapy per day for at least five days per week;
• be able to actively participate in and significantly benefit from intensive rehabilitation therapy;
• require physician supervision; and
• require an intensive and coordinated interdisciplinary approach to rehabilitation services.
"Crossing all of the t's and dotting all of the i's is a difficult feat for personnel who are actively engaged in patient care," says Elizabeth LeMaster, MD, senior medical director at Executive Health Resources.
As in any provider setting, what's considered reasonable and necessary continues to remain somewhat subjective, says Connelly. "It still boils down to an opinion. … The physician needs to use medical judgment that is not defined in the coverage rules," he says. "The end result is that there's not a cut-and-dry answer as to whether a particular patient will be covered in the inpatient rehabilitation setting."
Connelly frequently sees denials for patients with debility (ie, those who cannot care for themselves following weakness due to illness or lack of mobility). RAs often deny these claims, stating the patient doesn't require close physician supervision in the IRF setting because he or she doesn't have any acute problems. "We would respond by saying that if the patient truly had active acute issues that a physician needed to address, then the patient would likely be in an acute care hospital setting—not an inpatient rehab setting," Connelly says.
Take the example of an elderly patient who requires close medical supervision when undergoing an exercise regime to ensure that the program doesn't cause other problems or injuries. This is the type of scenario that RAs often deny inappropriately, Connelly says.
RAs also commonly deny patients who are unable to tolerate three hours of therapy per day at least five times per week as required by regulation. Connelly appeals these denials by stating that IRFs have no way of knowing with complete certainty at the time of admission whether a patient can tolerate the required threshold of therapy.
The Centers for Medicare & Medicaid Services (CMS) announced in February 2014 that it would pause operations to make improvements to the RA program and begin the process for procuring new RA contracts. Although RAs continued to conduct automated reviews through June 1, 2014, all other reviews were ceased. In August 2014, however, the CMS allowed RAs to restart automated reviews due to a delay in contract procurement related to a bid protest. Under the extension, scheduled to last through December 2015, the RAs are permitted to conduct limited complex reviews on certain CMS-specified issues such as outpatient therapy services and DMEPOS claims.
"We have been anticipating since last fall that they would start back up," Morgan says, adding that many IRFs are trying to use this interim time to prepare. "Over the last 21/2 years, compliance has increased significantly. I think the bigger issue in the past was not that people didn't know the rules but that they didn't understand the consequences of noncompliance. Now it's very obvious what will happen."
What might RAs be looking for once the audits resume? As in the past, RAs generally first focus on whether documentation requirements as outlined in the Medicare Benefit Policy Manual have been met. If the requirements have been met, the RA makes a determination as to whether the inpatient rehab stay is reasonable and necessary, says Shanice Williford, Esq, a regulatory research attorney at Executive Health Resources.
Documentation requirements continue to be a challenge. "Charts are usually very lengthy, and because Medicare's coverage requirements for inpatient rehab are very lengthy, very detailed, and time sensitive, sometimes the facilities cannot keep up with these requirements," Williford says.
Experts say that past audits are the best predictor of future investigations. Consider the following IRF vulnerabilities that require close monitoring and could be an RA target:
• Preadmission screening: This screening—an evaluation of the patient's condition and the need for rehabilitation therapy—must be conducted and signed within 48 hours immediately preceding the admission to the IRF. In addition, a rehabilitation physician must document that he or she reviewed and concurred with the findings and results of the screening prior to the IRF admission.
Morgan says some RAs have denied claims based on signatures that occurred only a few hours past the deadline. Other denials occur when IRFs use a system separate from the EHR to perform the screening and forget to include that documentation when responding to a request.
• Postadmission physician evaluation and physical exam: The purpose of this evaluation is to document the patient's status on admission to the IRF, compare it with the status noted in the preadmission screening, and begin development of the patient's expected course of treatment. It must be completed within 24 hours of admission to the IRF.
IRFs run into compliance problems when patients arrive on a weekend when physician coverage may be lessened. For example, a patient is transferred to the IRF on Friday at 5 PM. According to Medicare regulations, physicians must perform a full evaluation by 5 PM Saturday. If a physician completes the exam at 7 PM on Saturday or on Sunday, the claim may be denied.
"I know of one case that was denied for a 21-minute lapse," Morgan says. "The RA was getting that particular."
• Team conferences and signatures: A reasonable and necessary inpatient rehabilitation stay requires an overall plan of care that only an interdisciplinary team of medical professionals can provide. This team must meet at least once per week, and documentation of each team conference must include the names and professional designations of the participants.
One of the biggest challenges with the team conference is that if facilities are using a hybrid record, they often forget to scan the team conference notes. Another problem is that if the notes are written on both the front and back sides of the paper, the back side may be overlooked when scanning, Morgan says.
• Late transmission of patient assessment instruments (PAIs): According to the IRF-PAI Training Manual (available at http://tinyurl.com/od94gum), IRFs must submit PAIs no later than 27 calendar days from the date the patient was discharged from the acute care hospital. Late IRF-PAI submission has been an ongoing compliance issue, according to a 2012 Office of Inspector General report, which notes that Medicare administrative contractors (MACs) made a total of $8.4 million in overpayments to IRFs for claims that should have been reduced by a 25% penalty because the associated PAIs were transmitted after the 27-day deadline.
The good news for IRFs and other providers is that the CMS has implemented many improvements to the RA program to reduce provider burden and increase transparency. These changes, available at http://tinyurl.com/qffuwz4, are effective with each new contract award as of December 30, 2014. The following are some of the notable changes that may affect IRFs directly:
• Additional documentation request (ADR) limits are based on provider denial rates. This means that IRFs with low denial rates will have lower ADR limits while IRFs with high denial rates will have higher ADR limits.
• ADR limits are based on the entire facility and spread out across all claim types. This ensures that providers with multiple claim types are not disproportionately impacted by RA reviews of one particular claim type (eg, IRF claims only). Inpatient rehabilitation units within larger hospitals may see a significant decrease in the volume of requests now that they must be spread out over all claim types within the organization, Morgan says.
• RAs must wait 30 days to allow for a discussion period prior to sending the claim to the MAC for an adjustment. In the past, some MACs automatically demanded recoupment after an RA denial, preventing providers from submitting a response, Morgan says. This 30-day window ensures that providers now have an opportunity to submit additional paperwork, contact the MAC, etc.
• RAs will not receive a contingency fee until after the second level of appeal is exhausted. "I think the RAC auditors will make sure that they don't deny cases just because they can," Morgan says. "Part of the problem before was that auditors knew they would get a financial reward for every chart they deny. Now what will happen is that RAs don't get their money until they get up through the qualified independent contractor level of appeal."
• RAs are required to maintain an overturn rate of less than 10% at the first level of appeal and an accuracy rate of at least 95%. This will bode well for all providers because its puts the onus on the RAs to ensure compliance practices.
Modes, Minutes of Therapy, and Automated Reviews
According to the FY 2015 IRF-PPS Final Rule (CMS-1608-F), the IRF-PAI includes a new Therapy Information section that requires providers to collect data on the amount and mode of therapy patients receive in each therapy discipline. The change goes into effect October 1.
"We expect that the collection of modes and minutes of therapy will provide a mechanism for automated review of the intensity of therapy services," Phillips says. "As an industry, this is on our radar."
There are many ways in which IRFs can increase compliance to reduce the likelihood that an RA will recoup money during an audit. Consider the following tips:
• Establish an RA response team. Members should include the HIM director, billing manager, nurse manager, and a C-suite member. Designate one individual with a specialized knowledge of IRF documentation requirements to whom all RA correspondences will be sent.
Don't forget to include the third-party billing agency in any RA discussions, Morgan says. "Many people don't realize that RA requests come in because the official address that was on the letter was not the actual physical location of the IRF building," she says. "It may have been a third-party billing agency."
The team should ensure that all billers—either onsite or via an agency—understand the significance of RA requests and denials. If an RA request letter comes across their desk, they must escalate that information, Morgan says. Billers also need to understand they must monitor for electronic and paper notifications from the MAC regarding audit findings.
• Know the documentation requirements. Take the time to review Section 110 of the Medicare Benefit Policy Manual. Create a checklist based on each requirement and highlight those requirements that include specific deadlines, says Dawn Crump, vice president of audit management solutions at HealthPort. Select a few documentation requirements and then perform a small internal probe audit, she adds.
Constant monitoring is the key to success, Morgan says. For example, some EHRs may be able to send alerts to providers to notify them that documentation must be completed within the hour.
However, compliant documentation isn't just about deadlines, Phillips notes. For example, a rehabilitation physician must document face-to-face interactions with the patient no less than three times per week. These interactions must show that the physician is managing the patient's care.
"Quantitatively, it's easy to show three rehab physician notes in the record," Phillips says. "Qualitatively, the notes have to meet the intent of the regulation. A note that says 'doing well in therapy' would not meet the requirement. The note should state what the patient is doing functionally and address how medical issues impact the patient's progress. The physician needs to show a level of assessment for the patient."
• Open lines of communication with acute care facilities. IRFs often rely on information that does not originate within their unit or facility. For example, the acute care hospital should provide the IRF with a discharge summary, therapy evaluation, surgical reports, radiology reports, and a transfer sheet. All of these documents must be scanned and uploaded into the IRF's EHR.
"We have to prove that at the time the patient left the [acute care] building and came to the IRF that he or she wasn't capable of going to a nursing home [or other lower-intensity setting]," Morgan says.
• Don't let small details slip through the cracks. Ensure that someone checks all documentation before sending it to an RA. This includes ensuring that any and all paper information has been scanned into and printed from the EHR. Also be certain that the correct patient record is sent to the RA, Morgan advises. Many patients have the same last name—some of those may also have the same first name.
• Monitor all denials. Know the types of technical denials received as well as where documentation for medical necessity may be lacking. Ensure providers clearly articulate why the patient requires close supervision and intense therapy, Connelly says. "That's the type of information that can be in the preadmission screening and postadmission evaluation," he says. "If that documentation is prepared thoroughly and accurately, it can really help the audit and the appeal."
Connelly also recommends reviewing all denials to determine whether they are appropriate. Look for evidence in the record to support an appeal and don't be afraid to appeal when there is supporting documentation in the record, he adds.
— Lisa A. Eramo is a freelance writer and editor in Cranston, Rhode Island, who specializes in HIM, medical coding, and health care regulatory topics.