From: "Andrea Crump" <ACrump@MSLC.COM>
Date: February 19, 2014 at 5:15:16 PM EST
To: "Andrea Crump" <ACrump@MSLC.COM>
Cc: "Mary Hairston" <mary.hairston@dmas.virginia.gov>, William.Lessard@dmas.virginia.gov, "Les Wingfield" <LWingfield@MSLC.COM>, "Richard Weinstein" <RWeinstein@MSLC.COM>, "Wendy malone" <wmalone@MSLC.COM>
Subject: Update on 4th Quarter CMI ReportsPlease forward this message to the MDS Coordinators in your organization:4th Quarter Preliminary CMI Reports were sent to nursing facility providers on February 17. Many providers have contacted Myers and Stauffer or DMAS about discrepancies in these reports. DMAS is investigating and will communicate the results to providers. Please do not utilize these reports or submit research requests until further communication from DMAS.Andrea N. CrumpManagerMYERS AND STAUFFER LC4400 Cox Road, Suite 110Glen Allen, VA 23060PH 804.270.2200FX 804.270.2311
Wednesday, February 19, 2014
Virginia Providers: 4th Quarter Preliminary CMI reports from DMAS are incorrect. You do not have to do the research requests.
Friday, February 7, 2014
MAC/ZPIC Contractor Directory: Interactive by state
I just came across this on the CMS website. Don't know how long it's been up, but it's a 'one stop shopping center' for finding the name and POC information for finding your MAC, ZPIC, & RAC. Link is below, you may have to cut and paste.
http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Review-Contractor-Directory-Interactive-Map/index.html
Review Contractor Directory - Interactive Map
The Review Contractor Directory - Interactive Map allows you to access state-specific CMS contractor contact information. You may receive correspondence from one or several of these contractors in your state. They may request medical records from you, as they perform business on behalf of CMS. You can use this website to access their contact information including emails, phone numbers and websites.
http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Review-Contractor-Directory-Interactive-Map/index.html
Saturday, February 1, 2014
OIG Work Plan for SNFs 2014
Medicare Part A billing by skilled nursing facilities (new)
Policies and Practices. We will describe SNF billing practices in selected years and will describe variation in billing among SNFs in those years. Context—Prior OIG work found that SNFs increasingly billed for the highest level of therapy even though beneficiary characteristics remained largely unchanged. OIG also found that SNFs billed one-quarter of all 2009 claims in error, resulting in $1.5 billion in inappropriate Medicare payments. CMS has made substantial changes to how SNFs bill for services for Medicare Part A stays. (OEI; 02-13-00610; 00-00-0000; various reviews; expected issue date: FY 2014; work in progress)
Questionable billing patterns for Part B services during nursing home stays
Billing and Payments. We will identify questionable billing patterns associated with nursing homes and Medicare providers for Part B services provided to nursing home residents during stays not paid under Part A (for example, stays during which benefits are exhausted or the 3-day prior-inpatient-stay requirement is not met). A series of studies will examine several broad categories of services, such as foot care. Context—Congress explicitly directed OIG to monitor Part B billing for abuse during non-Part A stays. (Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), § 313.) (OEI; 06-14-00160; various reviews; expected issue date: FY 2014; work in progress)
State agency verification of deficiency corrections
Quality of Care and Safety—We will determine whether State survey agencies verified correction plans for deficiencies identified during nursing home recertification surveys. Context—A prior OIG review found that one State survey agency did not always verify that nursing homes corrected deficiencies identified during surveys in accordance with Federal requirements. Federal regulations require nursing homes to submit correction plans to the State survey agency or CMS for deficiencies identified during surveys. (42 CFR § 488.402(d).) CMS requires State survey agencies to verify the correction of identified deficiencies through onsite reviews or by obtaining other evidence of correction. (State Operations Manual, Pub. No. 100-07, § 7300.3.) (OAS; W-00-13-35701; W-00-14-35101; various reviews; expected issue date: FY 2014; work in progress)
Program for national background checks for long-term-care employees
Quality of Care and Safety. We will review the procedures implemented by participating States for long-term-care facilities or providers to conduct background checks on prospective employees and providers who would have direct access to patients and determine the costs of conducting background checks. We will determine the outcomes of the States' programs and determine whether the programs led to any unintended consequences. Contex—This mandated work is ongoing and will be issued at the program's conclusion as required. (Affordable Care Act, § 6401.) (OEI; 07-10-00420; expected issue date: FY 2017; work in progress; Affordable Care Act) HHS OIG Work Plan | FY 2014 Medicare Part A and Part B Page 9
Hospitalizations of nursing home residents for manageable and preventable conditions
Quality of Care and Safety—We will determine the extent to which Medicare beneficiaries residing in nursing homes are hospitalized as a result of conditions thought to be manageable or preventable in the nursing home setting. Context—A 2013 OIG review found that 25 percent of Medicare beneficiaries were hospitalized for any reason in FY 2011. Hospitalizations of nursing home residents are costly to Medicare and may indicate quality-of-care problems in the nursing homes. (OEI; 06-11-00041; expected issue date: FY 2014; work in progress)
Policies and Practices. We will describe SNF billing practices in selected years and will describe variation in billing among SNFs in those years. Context—Prior OIG work found that SNFs increasingly billed for the highest level of therapy even though beneficiary characteristics remained largely unchanged. OIG also found that SNFs billed one-quarter of all 2009 claims in error, resulting in $1.5 billion in inappropriate Medicare payments. CMS has made substantial changes to how SNFs bill for services for Medicare Part A stays. (OEI; 02-13-00610; 00-00-0000; various reviews; expected issue date: FY 2014; work in progress)
Questionable billing patterns for Part B services during nursing home stays
Billing and Payments. We will identify questionable billing patterns associated with nursing homes and Medicare providers for Part B services provided to nursing home residents during stays not paid under Part A (for example, stays during which benefits are exhausted or the 3-day prior-inpatient-stay requirement is not met). A series of studies will examine several broad categories of services, such as foot care. Context—Congress explicitly directed OIG to monitor Part B billing for abuse during non-Part A stays. (Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), § 313.) (OEI; 06-14-00160; various reviews; expected issue date: FY 2014; work in progress)
State agency verification of deficiency corrections
Quality of Care and Safety—We will determine whether State survey agencies verified correction plans for deficiencies identified during nursing home recertification surveys. Context—A prior OIG review found that one State survey agency did not always verify that nursing homes corrected deficiencies identified during surveys in accordance with Federal requirements. Federal regulations require nursing homes to submit correction plans to the State survey agency or CMS for deficiencies identified during surveys. (42 CFR § 488.402(d).) CMS requires State survey agencies to verify the correction of identified deficiencies through onsite reviews or by obtaining other evidence of correction. (State Operations Manual, Pub. No. 100-07, § 7300.3.) (OAS; W-00-13-35701; W-00-14-35101; various reviews; expected issue date: FY 2014; work in progress)
Program for national background checks for long-term-care employees
Quality of Care and Safety. We will review the procedures implemented by participating States for long-term-care facilities or providers to conduct background checks on prospective employees and providers who would have direct access to patients and determine the costs of conducting background checks. We will determine the outcomes of the States' programs and determine whether the programs led to any unintended consequences. Contex—This mandated work is ongoing and will be issued at the program's conclusion as required. (Affordable Care Act, § 6401.) (OEI; 07-10-00420; expected issue date: FY 2017; work in progress; Affordable Care Act) HHS OIG Work Plan | FY 2014 Medicare Part A and Part B Page 9
Hospitalizations of nursing home residents for manageable and preventable conditions
Quality of Care and Safety—We will determine the extent to which Medicare beneficiaries residing in nursing homes are hospitalized as a result of conditions thought to be manageable or preventable in the nursing home setting. Context—A 2013 OIG review found that 25 percent of Medicare beneficiaries were hospitalized for any reason in FY 2011. Hospitalizations of nursing home residents are costly to Medicare and may indicate quality-of-care problems in the nursing homes. (OEI; 06-11-00041; expected issue date: FY 2014; work in progress)
Friday, January 24, 2014
Verbal guidance from CMS on coding Section K that is beyond what is published in the current RAI Manual
From the
AANAC LTC Leader dated 1/23/14 (NOTE FROM JUDY: THIS IS NOT IN THE CURRENT RAI MANUAL)
Officials
with the Centers for Medicare and Medicaid Services
(CMS) discussed several issues at the Jan. 16 Skilled Nursing
Facility/Long-term Care Open Door Forum
(SNF/LTC ODF).
K07010
coding example
CMS
officials provided an example to illustrate the proper coding of MDS 3.0 item
K0710 (percent intake by artificial route) when the look-back period includes
time prior to and after admission or reentry:
Mr. K
has been able to take some fluids orally. However, due to his progressing
multiple sclerosis, his dysphaghia is not allowing him to remain hydrated.
Therefore, he received the following fluid amounts over the last seven days via
supplemental tube feedings while in the hospital and after he was admitted to
the nursing home.
Over
four days in the hospital, Mr. K received the following:
• Monday, 400 cc;
• Tuesday, 520 cc;
• Wednesday, 500 cc;
and
• Thursday, 480 cc.
Over
three days in the nursing home, Mr. K received the following:
• Friday, 510 cc;
• Saturday, 520 cc;
and
• Sunday, 490 cc.
In this
scenario, K0710B (average fluid intake per day by IV or tube feeding) would be
coded as follows:
• K0710B1 (while NOT
a resident) would be coded 1, indicating 500 cc per day or less.
• K0710B2 (while a
resident) would be coded 2, indicating 501 cc per day or more.
• K0710B3 (during
entire seven days) would be coded 1, also indicating 500 cc per day or less.
“The rationale for
this is that the total fluid intake in the last seven days while Mr. K was not
a resident was 1,900,” said officials. “That is the sum of 400 on Monday, 520
on Tuesday, 500 on Wednesday, and 480 on Thursday. The average fluid intake
while not a resident totaled 475 cc. Because that is less than
500, the correct
coding is 1 for K0710B1 (while NOT a resident).” The total fluid intake within
the last seven days while Mr. K was a resident of the nursing home was 1,520
cc, said officials. “That is the sum of 510 on Friday, 520 on Saturday, and 490
on Sunday. The average fluid intake was 507 cc for those three days. Since it
is greater than 500, the correct coding for K0710B2 (while a resident) would be
2.”
Finally, “the total
fluid intake during the entire seven days, and that includes while he was in
the nursing home and prior to being in the nursing home while he was in the hospital,
was 3,420 cc,” said officials. “The average for that entire seven-day period
was 489 cc (dividing the total of 3,420 cc by those 7 days).
Because that 489 is
less than 500, the correct code for K0710B3 (during entire seven days) would be
1.”
Wednesday, January 22, 2014
As HHS Moves To End Overload Of Medicare Claims Appeals, Beneficiaries Will Get Top Priority Print Share
This KHN story was produced in collaboration with 
Medicare beneficiaries who have been waiting months and even years for a hearing on their appeals for coverage may soon get a break as their cases take top priority in an effort to remedy a massive backlog.
Nancy Griswold, the chief judge of the Office of Medicare Hearings and Appeals (OMHA), announced in a memo sent last month to more than 900 appellants and health care associations that her office has a backlog of nearly 357,000 claims. In response, she said, the agency has suspended acting on new requests for hearings filed by hospitals, doctors, nursing homes and other health care providers, which make up nearly 90 percent of the cases. She said that she expected the suspension would last about two years.
But beneficiaries’ appeals will continue to be processed, and officials are seeking to “ensure that the relatively small numbers of beneficiary-initiated appeals are being immediately addressed by prioritizing their cases,” the Department of Health and Human Services said in an announcement in the Federal Register.
“Because they are among our nation’s most vulnerable populations, OMHA is committed to being as responsive as possible to the Medicare beneficiary community, regardless of the challenges presented by the significant increase in the number of requests being filed,” Judge Griswold wrote in an email in response to a reporter’s questions. “Beneficiary appeals continue to be assigned as quickly as OMHA can process them, and processing times for beneficiary appeals are expected to decrease.”
From 2010 through 2013, the cases grew by 184 percent “while the resources to adjudicate the appeals remained relatively constant,” Griswold wrote in her memo last month. The office received 1,250 appeals weekly in January, 2012, but that has ballooned to more than 15,000 a week last November, and the average wait time is now 16 months. Since 2010, the number of administration law judges has increased by two to 65.
“We have elderly or disabled Medicare clients waiting as long as two years for a hearing and nine months for a decision,” said Judith Stein, executive director of the Center for Medicare Advocacy. They are typically appealing the denial of coverage for home care, nursing home care, challenging observation classification, ambulance trips and other services. Among them is a Connecticut man who requested a hearing a year ago to appeal the denial of nursing home coverage. He has since died, but his family is still pursuing the case, which is scheduled for a hearing next October.
Hospitals also report that the wait time for decisions on their appeals exceed the legal limit of 90 days, said Melissa Jackson, senior associate director for policy at the American Hospital Association. Adding two years to the process “is a violation of the statute.” She blamed the stepped-up scrutiny of hospital charges by recovery audit contractors whose payments are based on the number of questionable claims they uncover. Hospitals are then forced to appeal these denials, she said, “in order to get paid for medically necessary services.” And most of the time they win these challenges, she added.
Last Tuesday, the hospital association asked Medicare chief Marilyn Tavenner to suspend the audits until all pending appeals have been processed. Stopping the audits “would be the most straightforward solution, particularly since the next round of [audit] contracts has not yet been finalized,” wrote executive vice president Rick Pollack.
While the appeals office copes with the thousands of waiting cases and holds off handling new provider appeals, Stein was not sure if beneficiaries’ cases will move more quickly. Griswold revealed the suspension affected most hearings requested after April 1, 2013, but Stein said she had seen no improvement for seniors over that time.
“Most of my clients should not have to wait for a hearing as it is because they should have been granted coverage at the early stages of appeal,” she said. “There are too many people who can’t get a fair shake at the lower levels of appeals and that’s a big reason why so many have to go on to a hearing.”
A hearing before an administrative law judge is the third level of appeal and the first opportunity for appellants to present arguments to a person, since the first two appeals are decided by Medicare contractors who review case files. At the hearing, testimony can be provided, witnesses can be cross-examined, and new evidence can be introduced.
It also offers the best chance of winning, a 2012 investigation by the HHS inspector general found. The judges reversed the lower level denials 56 percent of the time for all appellants, including 61 percent of the time for providers and 28 percent for beneficiaries. When investigators looked at the appeals by type of claim, they found that the judges reversed 72 percent of denials involving payment for hospital care, under Medicare’s Part A hospitalization benefit.
In addition to the increase in appeals filed in response to more stringent audits of hospital claims, the OMHA caseload has expanded along with the increased number of Medicare beneficiaries and because the agency now handles appeals of prescription drug coverage, a benefit that was added in 2006.
Next month, the OMHA is hosting a day-long forum to provide more details to appellants.
Contact Susan Jaffe at Jaffe.KHN@gmail.com.
Nationwide Contract Therapy Providers to Pay $30 Million to Resolve False Claims Act Allegations
Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Friday, January 17, 2014
Nationwide Contract Therapy Providers to Pay $30 Million to Resolve False Claims Act Allegations
Contract therapy providers RehabCare Group Inc., RehabCare Group East Inc. and Rehab Systems of Missouri and management company Health Systems Inc. have agreed to pay $30 million to resolve claims that they violated the False Claims Act by engaging in a kickback scheme related to the referral of nursing home business, the Justice Department announced today. Additionally, as part of this settlement, the entities have agreed to restructure their business arrangement.
“Health care providers that attempt to profit from illegal kickbacks will be held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We will continue to advocate for the appropriate use of Medicare funds and the proper care of our senior citizens.”
Between March 1, 2006, and Dec. 31, 2011, RehabCare allegedly arranged with Rehab Systems of Missouri to obtain Rehab Systems of Missouri ’s contracts to provide therapy to patients residing in 60 nursing homes controlled by Rehab Systems majority-owner James Lincoln. In exchange for this stream of referrals, RehabCare allegedly paid Rehab Systems a $400,000 to $600,000 upfront payment and allowed Rehab Systems to retain a percentage of the revenue generated by each referral.
“The Anti-Kickback Statute is intended to protect patients and federal health care programs from fraud and abuse,” said Acting U.S. Attorney for the District of Minnesota John Marti. “We will remain vigilant in pursuing entities that improperly further their financial interest at the expense of the Medicare Trust Fund.”
“This settlement sends a message to those who seek to improperly take advantage of the Medicare program,” said U.S. Department of Health and Human Services Office of Inspector General Special Agent in Charge Gerald T. Roy. “The Office of the Inspector General, Kansas City Regional Office will continue to work aggressively to eliminate this type of misconduct from our health care system.”
“The FBI will continue to work with its partners to combat this type of abuse,” said Special Agent in Charge of the FBI’s Minneapolis Office J. Chris Warrener. “It remains committed to the elimination of fraud to ensure the integrity of federal health care programs.”
This civil settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered more than $17.1 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlement resolves allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery. The whistleblower will receive $700,000 as its share of the recovery in this case.
The case was handled by the U.S. Attorney’s Office for the District of Minnesota with assistance from the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Missouri, the Federal Bureau of Investigation and the U.S. Department of Health and Human Services Office of Inspector General. This action was supported by the Elder Justice and Nursing Home Initiative that coordinates the department’s activities combating elder abuse, neglect and financial exploitation, especially as they impact beneficiaries of Medicare, Medicaid and other federal health care programs.
The lawsuit is captioned U.S. ex rel. Health Dimensions Rehabilitation Inc. v. RehabCare Group Inc., et. al., Case No. 4:12-cv-00848 AGF (E.D. Mo.). The claims settled by this agreement are allegations only; there has been no determination of liability.
Friday, January 17, 2014
From Center for Medicare Advocacy: Call to Repeal Therapy Caps
Medicare Therapy Caps: A Call for Repeal
Medicare-covered outpatient physical, speech and occupational therapy services are subject to an annual dollar-amount payment cap. As a result, many Medicare beneficiaries have their therapy terminate prematurely when they reach the cap. While there is an Exceptions process in place that allows beneficiaries to receive therapy in excess of the caps, it is set to expire on March 31, 2014. Moreover, the existing process is burdensome and many providers of services are slow to assist beneficiaries in obtaining therapy cap Exceptions.
Current Congressional efforts to revise or replace the physician "Sustainable Growth Rate" (SGR) formula (which, left unchanged, would substantially lower physician reimbursements) provide an opportunity to eliminate the therapy payment cap, or raise the financial cap sufficiently so that Medicare beneficiaries are able to receive prescribed therapy services in an amount sufficient to address their medical needs. Since the inception of SGR, there has been annual legislation called the "doc fix" to avoid the implementation of SGR and its draconian impact on physician reimbursement.
Therapy Caps and Exceptions Process - Overview
The Balanced Budget Act (BBA) of 1997 imposed a payment cap on the annual amount of Medicare coverage available for beneficiaries receiving outpatient therapy services. Two distinct caps were placed on therapy services: for physical therapy (PT) and speech language pathology service (ST) combined, the cap is $1,920 in 2014. For occupational therapy (OT) services, the cap is also $1,920. The therapy cap applies to all Part B outpatient therapy settings and providers, including private practices, skilled nursing facilities, home health agencies, outpatient rehabilitation facilities, comprehensive outpatient rehabilitation facilities, and hospital outpatient departments.[1]
Although absolute Medicare payment caps were set to go into effect in 1999, since that time Congress has acted approximately ten times to prevent the implementation of the therapy caps either through a moratoria or by establishing an "Exceptions" process. The Exceptions process, created through the Deficit Reduction Act (DRA) of 2005, allows individuals and providers to seek Medicare coverage of therapy services above the cap. Automatic Exceptions are available when therapists attest that ongoing therapy services are reasonable and necessary and must be justified by supporting documentation in the beneficiary's medical record. However, starting in 2012, claims exceeding a threshold of $3,700 (either for PT and ST combined, or separately for OT) are subject to a mandatory manual medical review by Medicare contractors.[2]
In recent years, extension of the Exceptions process has been included as an "extender" to the annual "doc fix" legislation preventing SGR from going into effect. Most recently, as part of a broader year-end budget agreement in December 2013, Congress passed a temporary three-month patch to the SGR, preventing immediate cuts to physician payment starting in January 2014, and includes "extenders" such as the therapy cap Exceptions process.[3] Without further Congressional action, the therapy cap Exceptions process will expire on March 31, 2014 and the therapy caps will remain in place. According to an estimate by the Medicare Payment Advisory Commission (MedPAC), once the exceptions process expires and a hard cap is implemented, "about 20 percent of beneficiaries receiving outpatient therapy would have their therapy truncated at the cap."[4]
Current Policy is a Barrier to Care
According to many advocates and providers, the therapy caps serve as a significant barrier to accessing necessary therapy services for individuals with long-term, chronic conditions who require ongoing therapy services.[5] Set at arbitrary dollar amounts, these caps are aimed at federal cost-savings rather than ensuring Medicare coverage of clinically appropriate services.
The Exceptions process is the only means for an individual to obtain needed therapy services that exceed the annual cap. Although the existence of the Exceptions process is better than an absolute cap with no means to seek additional coverage, the current manual review process, triggered when someone reaches the $3,700 cap, serves as a de facto absolute cap for many beneficiaries. Since the process requires significant and burdensome involvement on the part of providers, it is the experience of beneficiary advocates that the manual review deters many providers from processing Exceptions, thus limiting beneficiary access to needed therapy services. As a result, many beneficiaries who need ongoing therapy go without therapy services altogether.
The current debate in Congress about SGR has highlighted the plight of other policy "extenders" such as the therapy caps and the related exceptions process.[6] Policy recommendations regarding the therapy caps range from repealing them altogether to making them more restrictive.
As discussed in a previous Alert, the SFC bill would repeal the caps and replace them with a new medical review program including prior authorization. The Secretary of Health and Human Services would identify the services for medical review, including factors such as outlier billing patterns and newly enrolled providers.[8]
Although this proposal currently lacks detail necessary to assess its full potential impact on beneficiaries' access to care, it is clearly an acknowledgement that the current therapy cap policy is broken and needs to be repealed, along with instituting a more targeted approach toward medical review. Unfortunately, not all policymakers and entities advising them agree.
In addition to other recommendations to reduce Medicare expenditures on outpatient therapy, including increased physician oversight and certain program integrity measures, MedPAC endorsed retaining an Exceptions process with a more "streamlined" manual medical review process for therapy claims that exceed the cap. In a statement that neither comports with our experience assisting people with Medicare who need ongoing therapy services nor acknowledges the difference between automatic and manual review in the current exceptions process, MedPAC noted that a "broad exceptions process allows providers to deliver services above either spending cap relatively easily, limiting the effectiveness of the caps."
In short, MedPAC's solution to beneficiaries' current challenges accessing ongoing, medically necessary therapy services is to lower the therapy cap, eliminate the automatic review and apply manual medical review to all claims that exceed the cap. With an eye toward limiting Medicare expenditures – while ignoring the welfare of Medicare beneficiaries – MedPAC adds:
"In addition, we note that if spending on outpatient therapy services is projected to be above current law, and the Congress wishes to further constrain spending, it could lower the therapy caps further and increase the number of services subject to medical review, reduce payment rates for longer episodes of care, or increase beneficiary cost sharing for longer episodes."
Conclusion
Many Medicare beneficiaries are already denied ongoing, medically necessary outpatient therapy services because of current therapy cap limitations and onerous Exceptions process that effectively serves as an absolute cap on coverage.
As recently highlighted by former Congresswoman Gabrielle Giffords, longer-term, ongoing therapy can be the key to functionality and life-changing improvements:
"…This past year, I have achieved something big that I've not spoken of until now. Countless hours of physical therapy — and the talents of the medical community — have brought me new movement in my right arm. It's fractional progress, and it took a long time, but my arm moves when I tell it to. Three years ago, I did not imagine my arm would move again. For so many days, it did not. I did exercise after exercise, day after day, until it did. I'm committed to my rehab and I'm committed to my country, and my resolution, standing with the vast majority of Americans who know we can and must be safer, is to cede no ground to those who would convince us the path is too steep, or we too weak."[11]
It's time to reduce barriers to care, not exacerbate them. We urge Congress to repeal the Medicare outpatient therapy caps.
ADDENDUM: Note on Jimmo Improvement Standard Settlement and Therapy Caps
Absent either a repeal of the therapy caps altogether, or an expiration of the exceptions process (leaving the caps in place), the current rules outlining the exceptions process present challenges to the implementation of the settlement ofJimmo v. Sebelius, the improvement standard case. As discussed thoroughly elsewhere, the Center and Vermont Legal Aid reached a settlement with the Department of Health and Human Services (HHS) in Jimmo. The court approved settlement confirms a maintenance standard for skilled nursing facilities, home health care, and outpatient therapy, dispelling the myth that Medicare will pay for care and services only if a beneficiary is likely to "improve."[12] In practice, this will allow beneficiaries with conditions like Parkinson's, MS and Alzheimer's to receive ongoing therapy services that likely exceed the current therapy caps.
As part of this settlement, CMS revised certain Medicare manual provisions which in turn should make it easier to obtain Medicare coverage for outpatient therapy because maintenance therapy is now specifically permitted if it is to maintain a person's condition or prevent deterioration.[13 While the Jimmo settlement does not undo the therapy caps, the improvement standard should not apply to therapy received either before the caps are met or to coverage of therapy obtained through the exceptions process.[14] One provision in the Medicare Claims Processing Manual relating to the therapy cap exceptions process, however, remains of concern because of language suggesting the ongoing application of an improvement standard.[15] Should the exceptions process remain in place, the Center will continue to work with CMS to address this language.
Current Congressional efforts to revise or replace the physician "Sustainable Growth Rate" (SGR) formula (which, left unchanged, would substantially lower physician reimbursements) provide an opportunity to eliminate the therapy payment cap, or raise the financial cap sufficiently so that Medicare beneficiaries are able to receive prescribed therapy services in an amount sufficient to address their medical needs. Since the inception of SGR, there has been annual legislation called the "doc fix" to avoid the implementation of SGR and its draconian impact on physician reimbursement.
Therapy Caps and Exceptions Process - Overview
The Balanced Budget Act (BBA) of 1997 imposed a payment cap on the annual amount of Medicare coverage available for beneficiaries receiving outpatient therapy services. Two distinct caps were placed on therapy services: for physical therapy (PT) and speech language pathology service (ST) combined, the cap is $1,920 in 2014. For occupational therapy (OT) services, the cap is also $1,920. The therapy cap applies to all Part B outpatient therapy settings and providers, including private practices, skilled nursing facilities, home health agencies, outpatient rehabilitation facilities, comprehensive outpatient rehabilitation facilities, and hospital outpatient departments.[1]
Although absolute Medicare payment caps were set to go into effect in 1999, since that time Congress has acted approximately ten times to prevent the implementation of the therapy caps either through a moratoria or by establishing an "Exceptions" process. The Exceptions process, created through the Deficit Reduction Act (DRA) of 2005, allows individuals and providers to seek Medicare coverage of therapy services above the cap. Automatic Exceptions are available when therapists attest that ongoing therapy services are reasonable and necessary and must be justified by supporting documentation in the beneficiary's medical record. However, starting in 2012, claims exceeding a threshold of $3,700 (either for PT and ST combined, or separately for OT) are subject to a mandatory manual medical review by Medicare contractors.[2]
In recent years, extension of the Exceptions process has been included as an "extender" to the annual "doc fix" legislation preventing SGR from going into effect. Most recently, as part of a broader year-end budget agreement in December 2013, Congress passed a temporary three-month patch to the SGR, preventing immediate cuts to physician payment starting in January 2014, and includes "extenders" such as the therapy cap Exceptions process.[3] Without further Congressional action, the therapy cap Exceptions process will expire on March 31, 2014 and the therapy caps will remain in place. According to an estimate by the Medicare Payment Advisory Commission (MedPAC), once the exceptions process expires and a hard cap is implemented, "about 20 percent of beneficiaries receiving outpatient therapy would have their therapy truncated at the cap."[4]
Current Policy is a Barrier to Care
According to many advocates and providers, the therapy caps serve as a significant barrier to accessing necessary therapy services for individuals with long-term, chronic conditions who require ongoing therapy services.[5] Set at arbitrary dollar amounts, these caps are aimed at federal cost-savings rather than ensuring Medicare coverage of clinically appropriate services.
The Exceptions process is the only means for an individual to obtain needed therapy services that exceed the annual cap. Although the existence of the Exceptions process is better than an absolute cap with no means to seek additional coverage, the current manual review process, triggered when someone reaches the $3,700 cap, serves as a de facto absolute cap for many beneficiaries. Since the process requires significant and burdensome involvement on the part of providers, it is the experience of beneficiary advocates that the manual review deters many providers from processing Exceptions, thus limiting beneficiary access to needed therapy services. As a result, many beneficiaries who need ongoing therapy go without therapy services altogether.
- Also see ADDENDUM below regarding the application of the Jimmo settlement to the therapy caps and exceptions process.
The current debate in Congress about SGR has highlighted the plight of other policy "extenders" such as the therapy caps and the related exceptions process.[6] Policy recommendations regarding the therapy caps range from repealing them altogether to making them more restrictive.
- Senate Finance Committee: Repeal and Replace the Cap
As discussed in a previous Alert, the SFC bill would repeal the caps and replace them with a new medical review program including prior authorization. The Secretary of Health and Human Services would identify the services for medical review, including factors such as outlier billing patterns and newly enrolled providers.[8]
Although this proposal currently lacks detail necessary to assess its full potential impact on beneficiaries' access to care, it is clearly an acknowledgement that the current therapy cap policy is broken and needs to be repealed, along with instituting a more targeted approach toward medical review. Unfortunately, not all policymakers and entities advising them agree.
- MedPAC Recommendation: Lower the Cap
In addition to other recommendations to reduce Medicare expenditures on outpatient therapy, including increased physician oversight and certain program integrity measures, MedPAC endorsed retaining an Exceptions process with a more "streamlined" manual medical review process for therapy claims that exceed the cap. In a statement that neither comports with our experience assisting people with Medicare who need ongoing therapy services nor acknowledges the difference between automatic and manual review in the current exceptions process, MedPAC noted that a "broad exceptions process allows providers to deliver services above either spending cap relatively easily, limiting the effectiveness of the caps."
In short, MedPAC's solution to beneficiaries' current challenges accessing ongoing, medically necessary therapy services is to lower the therapy cap, eliminate the automatic review and apply manual medical review to all claims that exceed the cap. With an eye toward limiting Medicare expenditures – while ignoring the welfare of Medicare beneficiaries – MedPAC adds:
"In addition, we note that if spending on outpatient therapy services is projected to be above current law, and the Congress wishes to further constrain spending, it could lower the therapy caps further and increase the number of services subject to medical review, reduce payment rates for longer episodes of care, or increase beneficiary cost sharing for longer episodes."
Conclusion
Many Medicare beneficiaries are already denied ongoing, medically necessary outpatient therapy services because of current therapy cap limitations and onerous Exceptions process that effectively serves as an absolute cap on coverage.
As recently highlighted by former Congresswoman Gabrielle Giffords, longer-term, ongoing therapy can be the key to functionality and life-changing improvements:
"…This past year, I have achieved something big that I've not spoken of until now. Countless hours of physical therapy — and the talents of the medical community — have brought me new movement in my right arm. It's fractional progress, and it took a long time, but my arm moves when I tell it to. Three years ago, I did not imagine my arm would move again. For so many days, it did not. I did exercise after exercise, day after day, until it did. I'm committed to my rehab and I'm committed to my country, and my resolution, standing with the vast majority of Americans who know we can and must be safer, is to cede no ground to those who would convince us the path is too steep, or we too weak."[11]
It's time to reduce barriers to care, not exacerbate them. We urge Congress to repeal the Medicare outpatient therapy caps.
ADDENDUM: Note on Jimmo Improvement Standard Settlement and Therapy Caps
Absent either a repeal of the therapy caps altogether, or an expiration of the exceptions process (leaving the caps in place), the current rules outlining the exceptions process present challenges to the implementation of the settlement ofJimmo v. Sebelius, the improvement standard case. As discussed thoroughly elsewhere, the Center and Vermont Legal Aid reached a settlement with the Department of Health and Human Services (HHS) in Jimmo. The court approved settlement confirms a maintenance standard for skilled nursing facilities, home health care, and outpatient therapy, dispelling the myth that Medicare will pay for care and services only if a beneficiary is likely to "improve."[12] In practice, this will allow beneficiaries with conditions like Parkinson's, MS and Alzheimer's to receive ongoing therapy services that likely exceed the current therapy caps.
As part of this settlement, CMS revised certain Medicare manual provisions which in turn should make it easier to obtain Medicare coverage for outpatient therapy because maintenance therapy is now specifically permitted if it is to maintain a person's condition or prevent deterioration.[13 While the Jimmo settlement does not undo the therapy caps, the improvement standard should not apply to therapy received either before the caps are met or to coverage of therapy obtained through the exceptions process.[14] One provision in the Medicare Claims Processing Manual relating to the therapy cap exceptions process, however, remains of concern because of language suggesting the ongoing application of an improvement standard.[15] Should the exceptions process remain in place, the Center will continue to work with CMS to address this language.
For more information, contact attorney David Lipschutz (dlipschu@medicareadvocacy.org) in the Center for Medicare Advocacy's Washington, DC office at (202) 293-5760 or Executive Director Judith Stein in our Connecticut office at (860) 456-7790.
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