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March 2019

TPE Program Sets Sights on Improper Claims
By Elizabeth S. Goar
For The Record
Vol. 31 No. 3 P. 14

The nationwide Target, Probe, and Educate initiative focuses on Medicare outliers.

The Centers for Medicare & Medicaid Services’ (CMS) nationwide Target, Probe, and Educate (TPE) program is well underway, with Medicare Administrative Contractors (MACs) diligently analyzing claims data to identify areas with the greatest risk of inappropriate payment. While the program’s stated goal is to “help providers and suppliers reduce claim denials and appeals through one-on-one help” from the MACs, not everyone is convinced it’s quite so altruistic.

“The way they approach [TPE] is ‘We are going to review you as an organization, but we’ll give you a chance to improve; we aren’t going to ding you right away,’” says Vasilios Nassiopoulos, vice president of revenue integrity and transformation with Hayes Management Consulting. “But you have to approach this with skepticism … while it has the education component, which is seen as the government approaching [providers] with good intent—and I’m sure there are some good intentions—they are collecting billions.”

Indeed, according to the Government Accountability Organization (GAO), improper payments totaling $41.1 billion were made in 2016 under the Medicare fee-for-service program—an improper payment rate of 11%. The GAO also reports that MACs identified the following claim types as posing the greatest financial risk to Medicare:

• short inpatient acute care stays and both skilled nursing and inpatient rehab;

• evaluation and management and ambulance services;

• glucose monitors, urological supplies, continuous positive airway pressure devices, oxygen, wheelchair options and accessories, lower limb prosthetics, and immunosuppressive drugs; and

• home health therapy services and home health or hospice stays that were longer than average.

“The MACs perform data analysis looking at outliers [and] trends. They have a national database, a good baseline of what everyone is doing, so if a particular organization—provider or supplier—is an outlier, they say, ‘Let’s go pick on them.’ It’s nothing sophisticated, but they do have data from every organization that accepts Medicare,” Nassiopoulos says.

TPE Primer
TPE, which expanded from a limited pilot program to a nationwide rollout in October 2017, is “intended to increase accuracy in very specific areas,” according to CMS. Specifically, MACs analyze claims data to identify providers and suppliers with high claim error rates or unusual billing practices. They also look for error rates based on service-specific reviews, including items and services that have high national error rates. Providers that are already on targeted review may also be transitioned to TPE based on billing error rate results.

According Jeffrey A. Neustaedter, president of HCS HealthCare Consulting Solutions, which offers provider-focused services in revenue cycle management, chargemaster, strategic pricing, coding, documentation, reimbursement, billing, compliance, and education, the claims review is designed to ensure documentation supports the services billed and adheres to Medicare rules and regulations. Those “with compliant claims,” Neustaedter says, “don’t need to worry about being selected.”

Selected providers face up to three rounds of review, each of which will entail auditing a span of 20 to 40 pre- or postpayment claim samples and supporting medical records. A notification letter details the reason for selection and provides an overview of the process. The initial notification or additional data request (ADR) will indicate whether the sample is pre- or postpayment.

Providers have at least 45 days to make any necessary changes or improvements to claims and supporting documentation. Those found to be compliant won’t be selected for another TPE in the same topic area for at least one year. When errors are found, MACs will work with each provider in one-on-one sessions to help them identify and correct errors, the most common of which are missing physician signatures, documentation that doesn’t support medical necessity, encounter notes that don’t support all elements of eligibility, and missing or incomplete initial certifications or recertifications.

Neustaedter notes that the length of each round depends on how quickly the provider responds to the ADR or follow-up inquiries. Providers with moderate to high error rates are offered individualized educational sessions, during which an educator from the MAC takes them through each erroneous claim and answers any questions about the program or process. MACs also offer webinars and teleconferences to educate providers in addition to other methods of direct communication when appropriate.

Cautioning that failing to respond to an ADR will result in being “charged” with an error in the rate calculation, Neustaedter says that the MACs’ medical review teams notify providers in writing of the outcome of each review. This notification includes the number of claims reviewed, how many are allowed in full, how many are denied in full or in part, and limited education on the results. MACs have 30 days from the date the documentation is received to review and make a determination.

The payment error rate is calculated by dividing the allowed dollars in error by overall allowed dollars. For example, $1,000 in allowed dollars in error and $2,000 in allowed dollars results in a payment error rate of 50%.

Continued high error rates after three rounds result in the MAC referring the provider to CMS for additional action. This may include 100% prepay review, extrapolation, or referral to a recovery auditor, among other actions. If appropriate improvement or an error rate below the target threshold is achieved, reviews can be ended early.

Denials can be appealed using the Medicare Appeals Process, with the exception of claims denied because medical documentation was either not received or not received in a timely manner. In those cases, a “56900 reopening” may be requested to have the medical documentation evaluated by the medical review department.

Reasons for Concern
Nassiopoulos warns that the process is not as benign or random as the first notification letter may make it seem. MACs select their review cases with great care from the provider’s individual profile. The evaluations themselves also involve many tangible and intangible criteria. For example, when reviewing a certain procedure with very specific requirements, the decision is a straightforward pass or fail.

“But when it comes to medical necessity, it becomes a little bit intangible and subjective. [MACs] take advantage of this intangible element if documentation is not consistent, detailed, and to the point in order to promote the medical necessity,” Nassiopoulos says. “They will ding you, and it will be easy [for MACs] to support why you were failed. Unlike pass and fail grades, percentages are not very clear. They are set from similar audits performed across the nation.

“Regardless,” he continues, “there is a good probability that if you document well, you will pass, and they won’t bother you for another year. Think about how these auditors are getting paid—as a percentage of what CMS recovers. Why waste time with someone who is very thorough? If it’s a marginal pass, though, they may go back.”

Nassiopoulos notes that the education is not exactly what it seems. While CMS says the MACs are providing one-on-one education, “in reality, they dump a bunch of documents with CMS regulations and say, ‘You didn’t meet medical necessity for high-level office visits. Read these and do it right the next time.’

“If you fail,” he adds, “they tell you they will give you a chance to rebut it. However, I always tell people to think twice about that and only rebut those they are 100% sure about because it’s very expensive and time consuming.”

Another concern lies with the range of allowable error rates, which differ by MAC. For example, National Government Services has a rate of 15%, while Palmetto GBA’s is 20% and CGS Administrators’ is 25% for home health and hospice probes.

Since each MAC is reviewing compliance to the same CMS requirements, it’s puzzling why this variance in allowable error rates is allowed to exist. And while even a 25% rate may seem generous, even a small amount of claims errors can trigger further review.

“Getting additional rounds of probes and up to 80 more ADRs are a strong possibility,” says Joe Osentoski, BAS, RN-BC, reimbursement recovery and appeals director for QIRT (Quality in Real Time), which provides revenue cycle management and consulting for postacute agencies.

Osentoski notes that while overall TPE results data have been scarce, some MACs have shared information. Of 45 reviews that focused on issues of eligibility and medical necessity between October 2017 and June 2018, just four met allowable error rates, and only one of 12 probes issued to agencies that failed to respond to prior reviews met allowable rates. Nor was any improvement seen from a later sample base, with 29 of 30 providers being subjected to a second round.

“This demonstrates the continued danger of [providers] not giving ongoing compliance issues their due attention,” Osentoski says. “The number of providers that continue to be denied due to nonresponses to ADRs is really unacceptable at this point. Each is informed the TPE probe will occur, and ADR submission is not a new process. Home health agencies and other providers must learn how to respond to ADRs properly and timely or find a competent consultant to complete the response. Doing neither just hands money back to the MAC, both now and with future probes.”

Take It Seriously
Osentoski offers several recommendations for providers that find themselves on the receiving end of a review letter, the most important of which is to respond to the request either internally or with the help of a consultant.

“If your agency receives a TPE letter, read it all, organize your response or engage outside assistance to manage it, and obtain the best possible results,” he says.

Review all technical/administrative areas prior to final billing of a record and include face-to-face encounter content and certification requirements. Make use of the information available on some MAC websites to help prep staff on the top denial reasons. In some cases, the websites offer suggestions on how to correct errors.

“While often just restatements of the applicable regulation, these [pointers] do shed some light on record requirements,” says Osentoski, who adds that once a provider is engaged in a TPE audit, it should “always seek out and accept the MAC-offered education.”

Nassiopoulos notes that his recent visits with several major provider organizations made it clear that TPE reviews “are on top of the compliance workplan list. If they have been audited, they already know where the targets are. If they haven’t, they have to guess [although] the focus is primarily on complex cases across specialties and departments.

“Every department has its idiosyncrasies, but good, robust compliance departments know what the trends are,” he continues. “They’ve been audited in the past [and] even if it wasn’t specifically TPE, they have the Office of Inspector General’s work plan [and] they have historical data of another audit or a certification audit,” all of which can help prepare effective responses.

There are so many potential targets for TPE reviews that the program is unlikely to go away anytime soon. There are likely to be adjustments in valuation and management, which “translates into one key component, which is medical necessity. It must be demonstrated clearly by clinical documentation and very good clinical outcomes, Nassiopoulos says. “If you meet those parameters, you’re going to be fine. If you don’t, eventually you’re going to be dinged,” he says.

Nassiopoulos concludes by adding, “Robust compliance departments must be proactive and should not take TPE lightly. It’s a prelude of more to come, especially if you fail.”

— Elizabeth S. Goar is a freelance writer based in Tampa, Florida.