The post-acute care transfer policy was implemented by CMS in 1999 to stop a perceived double payment of certain DRGs and since that time has expanded from 10 DRGs being impacted to 273. Under this policy, if an acute care hospital transfers a patient to a post-acute care facility before the geometric length of stay (LOS) of the DRG, they will receive a graduated per diem payment, not to exceed a full DRG payment, for that stay.
The graduated per diem is paid when a transfer is made to:
-
a hospital or hospital sub-provider (i.e. – Psych or Rehab) that is excluded from payment under the inpatient prospective payment system
-
a skilled nursing facility (must be Medicare-certified bed & skilled level of care)
-
home, where there is a written plan of care for home health services, the services are related to the diagnosis for which the patient received inpatient hospital care, and the services must begin within 3 days of discharge
CMS put in place an edit on January 1, 2004 that stopped overpayments for transfers that were improperly coded as a discharge to home but did not put any checks and balances in place that would ensure providers were not underpaid. Underpayments can happen if a patient did not receive the anticipated care or did not receive it within the required timeframe. Most of these underpayments happen because the transfer was not made to a Medicare-certified skilled bed in a SNF or home health services did not begin within 3 days.
Unless a retrospective review is done, many of these underpayments are never discovered by hospitals. Typically, these underpayments occur in 1% to 3% of Medicare acute discharges and average around $2,000/error. The frequency of underpayments can be impacted by the Medicare LOS, the existence of related sub-providers and a hospital’s internal processes. For errors that are found during a retrospective review, hospitals should re-bill claims for services performed in the first 9 months of a calendar year by 12/31 of the following year or the second year if in the last 3 months (i.e. – discharges between 10/1/07 and 9/30/08 should be re-billed by 12/31/09). Reopenings can be requested for older claims if within 4 years of the time of the initial determination for good cause but reopenings are done at the discretion of the fiscal intermediary.
Pershing Yoakley & Associates now offers post-acute care transfer policy retrospective review services. If you would like additional information on these services, please contact the expert listed below at (800) 270-9629.
