OIG Work Plan update
Published November 14, 2019

New Items in the OIG’s Work Plan Update – October 2019

The Office of Inspector General (OIG) has published the latest additions to its Work Plan, which includes six noteworthy items related to hospice cap payments, speech and pathology payments, powered mobility device repairs, urine drug testing services, positive airway device supplies, and the Food and Drug Administration’s (FDA’s) post-market surveillance of medical devices. PYA offers insights on each of these additions.

Background

Each month, the OIG publishes the most recent additions to its Work Plan. The work plan development process is dynamic and requires adjustments throughout the year to meet the OIG’s “priorities and to anticipate and respond to emerging issues with resources available.” With a goal of transparency, the OIG updates its Work Plan website monthly, outlining recently added information. The following is a summary of the latest additions, the agencies affected, and what they mean for compliance leaders in healthcare organizations.

Review of Hospice Inpatient and Aggregate Cap Calculations–CMS

According to the OIG Work Plan update:

Hospice care can provide great comfort to beneficiaries, families, and caregivers at the end of a beneficiary’s life. To ensure that hospice care does not exceed the cost of conventional medical care at the end of life, Medicare imposes two annual limits to payments made to hospice providers: the inpatient cap and the aggregate cap. The inpatient cap limits the number of days of inpatient care for which Medicare will pay to 20 percent of a hospice’s total Medicare patient care days, and a hospice must refund to Medicare any payment amounts in excess of the inpatient cap. The aggregate cap limits the total aggregate payments that any individual hospice can receive in a cap year to an allowable amount based on an annual per-beneficiary cap amount and the number of beneficiaries served. Any amount paid to a hospice for its claims in excess of the aggregate cap is considered an overpayment and must be repaid to Medicare. Medicare administrative contractors (MACs) oversee the cap process and hospices must file their self-determined aggregate cap determination notice with their MAC no later than 5 months after the end of the cap year and remit any overpayment due at that time.

What You Need to Know:

Hospice care is different than conventional care; it is directed at the goals of comfort, dignity, and highest quality of life possible for whatever time remains, whether the patient is at home or in a nursing care environment. Medicare tracks hospice spending differently to ensure it does not add costs to the care of the dying.

MLN ICN 006817, effective January 2019, is an A-to-Z reference tool highlighting:

    1. Coverage and certification requirements for hospice.
    2. Coinsurance and payment rate election periods.
    3. Areas where no payment will be made for hospice services.
    4. Updates to rates, filings, and payments.
    5. Payment caps.
    6. Medicare Advantage enrollment options.
    7. Annual Payment Update (APU) Measures reporting.
    8. Other valuable resources and links.

In addition to hospice-employed physicians and nurse practitioners (NPs), as of January 1, 2019, Medicare hospice benefits cover physician assistants (PA) services or services furnished by other physicians under arrangement with the beneficiary.

What You Need to Do:

To be eligible for hospice benefits, a beneficiary must: a) be 65 years or older, b) meet Medicare Part A eligibility requirements, c) receive care through a Medicare-approved hospice provider, d) have waived all rights to Medicare payments for non-hospice services, and e) agree to forgo life-saving or potentially curative treatment. Additionally, a physician must certify the medical necessity of hospice care on the basis that the patient is terminally ill with a prognosis that he/she has six months or less to live.

Healthcare providers should ensure there is adequate management and oversight of subcontracted services to prevent improper billing. Hospice care givers should take steps to prevent billing for services prior to receiving a certificate of medical necessity (CMN), falsifying information on the CMN, or completing portions of a CMN that are to be completed only by the treating physician or other authorized person.

Medicare has two payment caps for hospice benefits:

    1. Inpatient cap: Inpatient care hospices cannot furnish services more than 20 percent of the total inpatient days.
    2. Aggregate cap: Hospices may receive an aggregate of payments furnished during a year, limited to the cap amount multiplied by the number of Medicare patients serviced. The CMS Manual, Pub 100-02 Medicare Benefit Policy, Transmittal 246 and Chapter 9 provides cap updates, reimbursement information, and calculation methods for counting beneficiaries and aggregate cap changes.

According to 42 CFR §418.308(c), “The hospice must file its aggregate cap determination notice with its Medicare contractor no later than 5 months after the end of the cap year and remit any overpayment due at that time.” Failure to file a “self-determined cap determination” within 5 months after the cap year will cause payments to be suspended until a determination is properly filed in accordance with 42 CFR § 405.371(e).

Hospices may not charge any amount above and beyond what Medicare or Medicaid pays, and claimed costs must be based on appropriate and accurate documentation. Hospice providers should perform audits and implement corrective actions to identify and exclude unallowable costs to ensure accurate capture and reporting of costs and statistical data. Any erroneous beneficiary counts or received cap payments must be promptly reported to the Medicare fiscal intermediary or applicable payer. Any overpayments must be remitted when filing the reports.

Medicare Part B Payments for Speech-Language Pathology–CMS

According to the OIG Work Plan update:

Outpatient speech therapy services are provided by speech-language pathologists and are necessary for the diagnosis and treatment of speech and language disorders that result in communication disabilities and swallowing disorders (dysphagia). When Medicare payments for a beneficiary’s combined physical therapy and speech therapy exceed an annual therapy spending threshold (e.g., $2,010 in 2018), the provider must append the KX modifier to the appropriate Healthcare Common Procedure Coding System reported on the claim. The KX modifier denotes that outpatient physical therapy and speech therapy services combined have exceeded the annual spending threshold per beneficiary, and that the services being provided are reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member. We will determine whether the claims using the KX modifier adhere to Federal requirements. In addition, we will evaluate payment trends to identify Medicare payments for outpatient speech therapy services billed using the KX modifier that are potentially unallowable.

What You Need to Know:

As of February 9, 2018, Title II – Section 50202 of the Bipartisan Budget Act of 2018 repeals specific Medicare payments for certain therapy services, and claims for therapy services beyond certain thresholds will be subject to targeted medical review. For CY2019, CMS increased the cap value to $2,040 (the threshold for physical therapy [PT] and speech-language pathology [SLP] outpatient  services), and the application of modifier KX (confirmation that justification and requirements for cap exceptions have been met and documented in the medical record and that therapy required the skills of a trained therapist). Modifier KX should be appended to an HCPCS code when the beneficiary qualifies for a therapy that exceeds the annual therapy spending threshold cap.

What You Need to Do:

42 CFR § 410.62 defines conditions and exclusions for outpatient SLP services, including where and to whom services can be furnished.

CMS Pub. 100-02, Medicare Benefit Policy Manual, Chapter 12, 40.4 states services “related to congenital speech difficulties, such as stuttering or lisping, are not covered.” The patient must: a) have an evaluation or reevaluation to determine level of function, and b) be reasonably expected to improve, restore, or compensate for lost function by participating in a speech-language program. Providers should have a process in place to ensure SLP patients have a plan of care (POC) that is furnished by a qualified individual outlined in 42 CFR § 484.115(n), with physician consultation, and that is carried out in compliance with regulatory guidance.

SLP therapy services at a Comprehensive Outpatient Rehabilitation Facility (CORF) are covered if physical therapy services are the predominant rehabilitation services provided by the CORF. Organizations should audit outpatient therapy for medical necessity, therapy units, and coding to ensure the KX modifier is used appropriately when the therapy cap is met, and verify that CMS and commercial payer billing and coding requirements are met.

Routine use of modifier KX is discouraged; overuse—identified through data analysis—can trigger an inquiry by any Medicare oversight agencies.

Review of Medicare Payments for Power Mobility Device Repairs–CMS

According to the OIG Work Plan update:

Medicare Part B covers medically necessary power mobility devices (PMDs), such as power wheelchairs, and PMD repairs that are reasonable and necessary to make the equipment serviceable. For calendar year 2018, Medicare Part B paid approximately $46.7 million for PMD repairs, including replacement parts needed to repair PMDs. Durable medical equipment (DME) suppliers must maintain documentation from the physician or treating practitioner indicating that the PMD being repaired continued to be medically necessary and that the repairs were reasonable and necessary. DME suppliers must also maintain detailed records describing the need for and nature of all repairs, which includes a justification for the replaced parts and the labor time. In addition, if the expense for repairs exceeds the estimated expense of purchasing or renting another PMD for the remaining period of medical need, no payment can be made for the amount of the excess. We will audit Medicare payments for PMD repairs to determine whether suppliers complied with Medicare requirements.

What You Need to Know:

42 CFR § 424.57(c) outlines standards and requirements for the suppliers of DME, prosthetics, orthotics, and supplies (DMEPOS) and the documentation necessary to bill Medicare for DME repairs. Proof of delivery in 42 CFR § 424.57(c)(12) requires that providers present proof of delivery documentation for requests from the DME MAC,[1] RAC,[2] SMRC,[3] CERT,[4] and ZPIC[5]/UPIC[6] within the prescribed timeframes, or associated claims will be denied and overpayments recouped. Non-compliance may result in revocation from the Medicare program; reoccurring violations may be referred to the OIG or National Supplier Clearinghouse (NSC) for investigation and/or imposition of sanctions.[7]

What You Need to Do:

CMS Medicare Program Integrity Manual, Chapter 5 Sections 5.8 and 5.8.1 outlines the “Items and Services Having Special DME Review Considerations” for suppliers that are submitting a claim to the DME MAC for repairs:

    1. Dispensing order
    2. Detailed written order
    3. CMN (if applicable), and the Documentation Information Form (DIF) (if applicable), or medical necessity support from the patient’s medical record assuring coverage criteria for repairs has been met
    4. Applicable information from the treating physician concerning the patient’s diagnosis as it relates to the DME supply
    5. Required modifiers or attestation statements as defined in certain DME MAC policies
    6. Properly executed Advance Beneficiary Notice (ABN) if medical necessity cannot be established

The above documentation must be maintained in the supplier’s files for seven years from the date of service.

MLN Matters SE19003 further clarifies the proof of delivery documentation requirements, explaining that if the UPIC is concerned that the Medicare beneficiary did not receive the billed DME items, repairs, or services, and proof of delivery cannot be verified, then the supplier will be considered non-compliant, which will result in claim denial and recoupment of overpayment. Consistent non-compliance with these requirements can result in an OIG investigation, sanctions, and revocation of participation in the Medicare program.

To accomplish these objectives and requirements, DME suppliers should implement compliance policies and procedures and an audit program to ensure they are only billing for items that are medically necessary, are not making unsolicited contact with Medicare beneficiaries, are not paying kickbacks for referrals, and are not falsifying required medical necessity and/or proof of delivery documentation.

Review of Medicare Part B Urine Drug Testing Services–CMS

According to the OIG Work Plan update:

Medicare covers treatment services for substance use disorders (SUDs), such as inpatient and outpatient services when they are reasonable and necessary. SUDs occur when the recurrent use of alcohol or other drugs causes clinically significant impairment, including health problems, disability, and failure to meet major responsibilities at work, school, or home. Medicare also covers clinical laboratory services, including urine drug testing (UDT), under Part B. Physicians use UDT to detect the presence or absence of drugs or to identify specific drugs in urine samples. A patient in active treatment for a SUD or being monitored during different phases of recovery from a SUD may undergo medical management for a variety of medical conditions. UDT results influence treatment and level-of-care decisions for individuals with SUDs. The 2018 Medicare fee-for-service improper payment data showed that laboratory testing, including UDT, had an improper payment rate of almost 30 percent, and that the overpayment rate for definitive drug testing for 22 or more drug classes was 71.7 percent. We will review UDT services for Medicare beneficiaries with SUD-related diagnoses to determine whether those services were allowable in accordance with Medicare requirements.

What You Need to Know:

Medical necessity criteria must be based on patient-specific concerns, including historical drug use, medication response, and the appropriate use of UDT for diagnosis and treatment of the SUD. Local Coverage Determination (LCD36037) outlines the policy and coverage guidance for UDTs, and Local Coverage Article (A56761) contains coding information such as CPT/HCPCS and ICD-10-CM codes that complement LCD36037 and support UDT testing. Treatment plans that outline the clinical approach for utilizing the UDT and managing the SUD support the necessity of a UDT order. Insufficient documentation to support the intent and medical necessity of the test, and even missing physician signatures can result in improper payments. Medical record documentation, including laboratory and supplier notes, may be requested to support payment of claims.

CMS regulates all laboratory testing (except research) performed on humans in the U.S. through the Clinical Laboratory Improvement Amendments (CLIA). Laboratories are accredited by the National Laboratory Certification Program (NLCP) to meet CLIA minimum requirements, and use the cutoff concentrations established by these guidelines to fulfill screening and validity tests.

What You Need to Do:

UDT laboratories should be diligent about identifying and eliminating unnecessary and excessive UDTs. Creating custom profiles (i.e., standing orders) can lead to submission of false claims. Providers who receive any remuneration for referrals to specific labs are in violation of the False Claims Act (FCA), Stark Law, and Anti-Kickback Statute (AKS).

Effective October 1, 2017, laboratories should access the Collection Site Checklist for the collection of urine specimens. In addition to following the guidance outlined for site evaluations, training, policy and procedures, completion and monitoring of collection processes, and accurate and complete record documentation, laboratories should also evaluate their payment processes. MLN Matters SE18001 states that, “Coding for UDT relies on a structure of ‘screening’ or ‘presumptive’ testing, and ‘quantitative’ or ‘definitive’ testing that identifies the specific drug and quantity in the patient.” For billing purposes, laboratories must be compliant with 42 CFR § 410.32(2)-(4) regulations, which state:

    1. Diagnostic or medical information containing the ICD-10-CM code or narrative description must be indicated on the order.
    2. Drugs or drug classes for which screening is performed must be specific to the patient and the need for the UDT.
    3. Laboratory orders must be signed, dated, and maintained in the beneficiary’s medical record.
    4. Medical necessity of the UDT must be supported.
    5. Orders must include sufficient information to identify and contact the ordering physician or nonphysician practitioner.
    6. Documentation must show accurate processing of the order and claim submission.
    7. Claims must contain the correct CPT/HCPCS coding.

In addition to implementing check points to ensure these criteria are met, clinical laboratories should utilize the processes outlined in the OIG’s Compliance Guidance for Clinical Laboratories for regulatory guidance and dedicate personnel to laboratory compliance oversight.

Supplier Compliance with Medicare Requirements for Replacement of Positive Airway Pressure Device Supplies–CMS

According to the OIG Work Plan update:

Beneficiaries receiving continuous positive airway pressure or respiratory assist device (collectively known as positive airway pressure [PAP] devices) therapy require replacement of supplies (e.g., mask, tubing, headgear, and filters) when they wear out or are exhausted. Medicare payments for these replacement supplies in 2017 and 2018 were approximately $945.8 million. Prior OIG work found that most Medicare claims that suppliers submitted for replacement PAP device supplies did not comply with Medicare requirements. For supplies and accessories used periodically, orders must specify the type of supplies needed, the frequency of use, if applicable, and the quantity to be dispensed, and suppliers must not automatically ship refills on a predetermined basis (Centers for Medicare & Medicaid Services Medicare Program Integrity Manual, Pub. 100-08, Ch. 5, §§ 5.2.3 and 5.2.8). We will review claims for frequently replaced PAP device supplies at selected suppliers to determine whether documentation requirements for medical necessity, frequency of replacement and other Medicare requirements are met.

What You Need to Know:

Prior to billing, PAP DME supplies and accessories require detailed written orders (DWO), which may be sent/received in the form of a photocopy, facsimile image, original hardcopy document, or electronic record (see Medicare Program Integrity Manual, Chapter 3, Section 3.3.2.4 for signature requirements and exceptions). Claims for PAP supplies and accessories without written orders will be denied by Medicare.

Per the Medicare Program Integrity Manual, Chapter 5, Section 5.2.3, “An exception to the requirement for a written order applies in those limited instances in which the prescribing practitioner is also the supplier and is permitted to furnish specific items of DMEPOS and fulfill the role of the supplier in accordance with any applicable laws and policies. In such cases, a separate order is not required, but the medical record must still contain all of the required order elements.”

What You Need to Do:

Suppliers should monitor and audit their practices to ensure there is no overutilization of items or supplies, order and delivery requirements are compliant, and CMN’s are completed prior to supply deliver. In order to make telephone contact with a beneficiary to whom they have provided an item or service during the preceding 15-month period, suppliers need his or her written permission.

Order requirements for DME equipment and supplies (other than drugs) include:

    1. Beneficiary name.
    2. Description of the supplies to include all items, options, or additional features that are separately billed or that require an upgraded code (can be a general description, e.g., wheelchair or hospital bed; a brand name/model number; or a HCPCS code or code narrative).
    3. Options and/or accessories that will be separately billed or that will require an upgraded code (list each separately).
    4. Appropriate information with the quantity and frequency of change.

Refills for DMEPOS items and supplies have strict timelines, as referenced in the Medicare Program Integrity Manual, Chapter 5, Section 5.2.8. Suppliers must contact the beneficiary or designee “no sooner than 14 calendar days prior to delivering” or dispensing the order. Automatic shipments on a pre-determined basis are not permissible in any circumstance. Refilled items must: a) be reasonable and necessary, b) only fulfill supplies that are running out or expiring, and c) must address any changes or modifications to the order(s). DMEPOS items must be delivered “no sooner than 10 calendar days” before the end of usage of the refilled/replaced product.

42 CFR § 424.57(c) outlines standards and requirements for DMEPOS suppliers and the documentation necessary to bill Medicare for DMEPOS refills. Proof of delivery, defined in 42 CFR § 424.57(c)(12), is required for billing purposes and can be requested by the DME MAC, RAC, SMRC, CERT, and ZPIC/UPIC. Claims that do not comply and violate the Medicare payment rules will be denied, and overpayments recouped. Providers found in non-compliance or with reoccurring violations may be referred to the OIG or NSC for investigation, have sanctions imposed, or have Medicare billing privileges revoked.

An Assessment of the U.S. Food and Drug Administration’s Post-Market Surveillance of Medical Devices–FDA

According to the OIG Work Plan update:

As the information that the U.S. Food and Drug Administration (FDA) receives about medical device safety and effectiveness is increasingly gathered in the post-market setting, it is more important than ever that FDA’s post-market safety surveillance system can effectively identify and act on safety signals. We will assess and describe how FDA’s established passive post-market surveillance system identifies and tracks safety concerns and assess FDA’s response to those concerns. We will also describe how elements of FDA’s newer surveillance system initiatives, such as the Unique Device Identification [UDI] system, are being integrated into the passive post-market surveillance system. In addition, we will describe how FDA plans to integrate these initiatives into the National Evaluation System for Health Technology, its in-development active post-market surveillance system.

What You Need to Know:

The FDA UDI Final Rule requires manufacturers, and in some cases distributors, to label FDA-rated Class I, II, and III medical devices or packaging with a unique number that could be read by humans and machines (typically a barcode). Using inventory management systems, providers, and supply chain personnel can access and retrieve data such as the serial number, lot number, and manufacture and expiration dates from the FDA’s Global UDI Database.

Today’s supply chain software programs can feed data about medical devices into the patient’s electronic health record (EHR) using the FDA’s UDI information, making it easier to track and identify devices in the supply chain or inside the EHR.

According to the FDA, suspected device-associated deaths, serious injuries, and malfunctions are reported via a medical device report (MDR) each year. The FDA uses MDRs housed in the Manufacturer and User Facility Device Experience (MAUDE) database to monitor device performance, detect potential device-related safety issues, and contribute to benefit-risk assessments of these products. The FDA monitors and reports these adverse events through safety signals and alerts to allow patients and healthcare professionals to make informed decisions. Recalls and safety signals can be queried and cross-referenced to the provider’s inventory and patient database. Providers can then identify the product or device in their inventory, and ascertain whether it has been utilized, and in which patient. This eliminates blanket communications and searching through medical records for device documentation.

What You Need to Do:

UDI information flowing from the supply chain through the surgery module into a patient’s medical record or claim is not yet mandatory, but soon will be. Vendors applying for certified EHR technology (CEHRT) and providers attesting for the CMS Promoting Interoperability (PI) Program (formerly Meaningful Use Stage 3) will need to prioritize the exchange of health information through disparate clinicians (clinician to clinician) and the patient (clinician to patient). Healthcare organizations can implement best practices to identify malfunctioning medical devices prior to any patient safety event.

Supply chain departments should develop a compliance plan as the first line of defense against risk to their patients and organization. The following initiatives can enhance the management of tracking and monitoring device supply chain inventory, preventing procedure delays, lowering costs, and increasing revenue:

    1. Establish a supply chain committee or council to align key stakeholders with a supply chain plan that follows the organization’s overall mission and strategy.
    2. Establish controls to minimize risk by keeping policies and procedures structured realistically and in an understandable format.
    3. Place procurement, logistics, contract management, and forecasting/planning functions under the supply chain leader in a central repository.
    4. Conduct mock safety alerts to ensure that all modes and methods of communication connect appropriately, and the organization is prepared for true safety signals and alerts.
    5. Integrate the UDI inventory into an annual supply chain audit that checks that device and product contracts are properly vetted and verifies whether vendors are offering quality work while complying with relevant regulations.

Assessing all areas of supply chain practices, including devices and products, can provide assurances that risks are managed up front and can meet the organization’s commitment to quality patient care and business objectives.

How PYA Can Help

PYA compliance consultants combine regulatory expertise with practical experience in healthcare organizations. Our compliance subject matter experts will provide a customized approach to assist you and your organization with today’s ever-changing compliance landscape.

If you would like more information about any matter involving compliance, valuation, or strategy and integration, contact one of our PYA executives below at (800) 270-9629.

[1] Medicare Administrative Contractor (MAC)

[2] Recovery Audit Contractor (RAC)

[3] Supplemental Medical Review Contractor (SMRC)

[4] Comprehensive Error Rate Testing (CERT)

[5] Zone Program Integrity Contractors (ZPIC)

[6] Unified Program Integrity Contractor (UPIC)

[7] Medicare Program Integrity Manual, Ch. 4 – Program Integrity, Sect. 4.26 (Pg. 117, found in: https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/pim83c04.pdf)

 

© 2019 PYA, P.C.

No portion of this article may be used or duplicated by any person or entity for any purpose without the express written permission of PYA.

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