October 19, 2016

Hot Topics Impacting Payments WV HFMA Fall Revenue Cycle Education

Jill Griffith, CPA, CPC Senior Manager - Health Care Services

Presented by:

What’s Hot

q  ICD -10 – One Year Post Implementation q  Notice act q  Bundled Payment Update q  R-HoPE q  Two Midnight Rule – update q  JW Modifier q  OIG Work Plan q  MACRA – Final Rule

2

ICD 10 – One Year LaterTitle

¨  Assess your ICD-10 Progress ¤  Key Performance Indicators (KPIs)

¨  Opportunities for Improvement ¤  Troubleshooting issues identified in

assessment ¤  System Enhancements and targeted staff

training ¨  Maintain forward momentum

¤  Keep up to date on ICD-10 changes

3

ICD 10 – One Year Later

¨  Assessing your progress ¤  Establish a baseline for each KPI

n  Compare KPIs before and after 10/1/15

¤  What data is available in your systems, reports and/or records.

n  Also may check data available from Clearinghouses, third party billers, system vendors

¤  What if no reports?

4

ICD 10 – One Year Later

¨  Example KPIs ¤  Days to final Bill ¤  Discharged not final billed ¤  Days to payment ¤  Claims acceptance/rejection rates ¤  Claims denial rates ¤  Coder productivity ¤  Volume of provider queries ¤  Incomplete or missing diagnosis codes ¤  DRG volumes

5

ICD 10 – One Year Later

¨  Troubleshooting ¤  Develop a feedback system ¤  Check clinical documentation and code selection ¤  Provide educational resources for providers and coders

¨  System Opportunities ¤  Check for technical problems ¤  Be sure all upgrades have been implemented. ¤  Is EHR system supporting ICD-10 documentation or code

selection?

¨  Resolve payer issues ¨  Conduct Hospital chart audits

6

ICD 10 – One Year Later

¨  Maintain progress

¨  Annual updates for 10/1

¨  Keep everything up to date

¨  You can submit proposals for diagnosis code updates to CDC to nchsicd10@cdc.gov

7

Notice Act -

¤  “Notice of Observation Treatment and Implication for Care Eligibility Act” n Enacted 8/6/15 n PL 114-42 n Copy at:

http://thomas.loc.gov/cgi-bin/toGPObsspubliclaws/http://gpo.gov/fdsys/pkg/PLAW-114publ42/pdf/PLAW-114publ42.pdf

n Effective 8/6/16 n Applicable to all hospitals

n  Including IRFs, IPFs and LTACs n  Includes CAHs

9

Medicare Outpatient Observation Notice

¨  Delay in implementation ¨  Beneficiary Notices Initiative (BNI)

https://www.cms.gov/Medicare/Medicare-General-Information/BNI/index.html

¨  Draft MOON, with instructions 8/2/16 ¨  CMS currently reviewing comments ¨  “Final version forthcoming”

10

Notice Act

¨  “(ii) a written notification (as specified by the Secretary pursuant to rulemaking and containing such language as the Secretary prescribes consistent with this paragraph) which – ¤  (I) explains the status of the individual as an outpatient

receiving observation services and not as an inpatient of the hospital or critical access hospital and the reasons for such status of such individual;

¤  (II) explains the implications of such status on services furnished by the hospital or critical access hospital (including services furnished on an inpatient basis), such as implications for cost-sharing requirements under this title and for subsequent eligibility for coverage under this title for services furnished by a skilled nursing facility.

11

Notice Act ¤  (III) includes such additional information as the Secretary

determines appropriate; ¤  (IV) either—

n  (aa) is signed by such individual or a person acting on such individual’s behalf to acknowledge receipt of such notification; or

n  (bb) if such individual or person refuses to provide the signature described in item (aa), is signed by the staff member of the hospital or critical access hospital who presented the written notification and includes the name and title of such staff member, a certification that the notification was presented, and the date and time the notification was presented; and

¤  (V) is written and formatted using plain language and is made available in appropriate languages as determined by the Secretary.”

12

Notice Act - MOON

13

https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing-Items/CMS-10611.html

Knee & Hip - CCJR ¨  Published July 14th Federal Register ¨  Copy at

http://www.gpo.gov/fdsys/pkg/FR-2015-07-14/pdf/2015-17190.pdf

¨  Proper name – Comprehensive Care for Joint Replacement ¨  90 day post acute bundling proposal ¨  Not voluntary ¨  Mandatory in 75 MSAs

¤  No WV MSA’s included.

¨  Effective 1/1/16 – Began 4/1/16 ¨  5 year demo

15

Proposed Bundled Payment Models ¨  August 2, 2016 Proposal – 3 new episode

payment models (EPMs) ¨  Heart attacks (AMI) ¨  Coronary bypass surgery (CABG) ¨  Surgical treatment of hip or femur fractures

(SHFFT) ¨  Tested for 5 years beginning July 1, 2017 ¨  CAHs and hospitals in rural counties excluded ¨  98 randomly selected MSAs

16

Proposed Bundled Payment Models ¨  Actual episode payment calculated at end of

first performance year and compared to.. ¨  Target prices (Quality adjusted)

¤ Hospital-specific and regional historical costs for treating condition during IP hospitalization – 90 days post discharge; n  Initially more heavily weighted on hospital-specific;

gradual shift to entirely regional data ¤ Complexity of the patient’s condition; and ¤ For heart attack a patient, whether the condition

was treated medically (including PCI) or surgically

17

Proposed Bundled Payment Models ¨  Takeaways from proposed rule:

¤  PPS Hospitals begin preparing for value-based payment models

¤ CMS announced movement n 30% Medicare payments by end of 2016 n 50% Medicare payments by end of2018

¤ Comments were due Oct 3 – stay tuned for final rule

18

Rural Hospital and Provider Equity Act of 2016 (R-HoPE) ¨  Introduced September 28, 2016 – Probably won’t

pass this calendar year ¤  Extension of the Medicare-Dependent Hospital Program ¤  Hospital Low-volume adjustment extension ¤  Reinstate Medicare wage reclass for some hospitals ¤  Medicare incentive for physician scarcity areas extension ¤  Extension of floor on Medicare work geographic

adjustment ¤  Removal of Medicares 96 hour physician certification

requirement for IP CAHs; and ¤  Increased Medicare payments for rural ground ambulance

services ¨  Stay tuned early in 2017

20

Two Midnight Rule Update

¨  CMS dropped payment cuts ¤  Temporary increase of .6% to make up for .2% reduction 2014-2016 ¤  Shands Jacksonville Medical Center vs Burwell

n  Challenged .2% reductions n  Court partially sided with AMA/Hospital

¨  Original policy – reverse trend toward higher observation stays

¨  Increases IP payments in 2017 by $539 million ¨  QIOs are auditing two midnight rule again

¤  Retraining is complete ¤  Effective 9/12/16

22

Two Midnight Rule – Documentation Tips

¨  Observation can be performed in any area of the hospital, key is difference – care is often same

¨  CMS “declaration of a plan” that will need two midnights ¤ Two midnights and a plan for two midnights

¨  Key to unexpected short stay – the outlined plan was met early, how?

¨  Don’t put inpatient payments at risk – must be a Great Plan documented in the record

¨  Involve clinical documentation team/UR

23

JW Modifier Update

¨  https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/JW-Modifier-FAQs.pdf

¨  National policy ¨  JW is used on a hospital outpatient claims to report the amount of

drug discarded and eligible for payment. ¤  Discarded drug is the amount that remains after dosing

administration to a Medicare beneficiary ¨  The modifier is only for single dose vials. ¨  Applies in Physician offices, Hospitals as well as CAHs ¨  Not applicable to FQHCs or RHCs, Inpatient hospital ¨  Do not use if actual dose administered < HCPCS billing unit

25

OIG Work Plan

The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) has the responsibility of detecting and preventing fraud, waste, and abuse in HHS programs as well as identifying opportunities to improve program economy, efficiency and effectiveness.

The OIG Work Plan summarizes new and ongoing reviews and activities that OIG plans to pursue with respect to HHS programs and operations during the current fiscal year and beyond.

27

OIG Update

¨  COMPLETED: Medicare Did Not Pay Select Inpatient Claims for Bone Marrow and Stem Cell Transplant Procedures in Accordance with Medicare Requirements (A-09-14-02037) – Issued February 2016. ¨  COMPLETED: Hospices Inappropriately Billed Medicare Over $250 Million for General

Inpatient Care (OEI-02-10-00491) – Issued March 2016. ¨  COMPLETED: CMS Has Not Performed Required Closeouts of Contracts Worth Billions (OEI-06-14-00680) – Issued December 2015. ¨  COMPLETED: National Background Check Program for Long-Term-Care Employees: Interim

Report (OEI-07-10-00420) – Issued January 2016. ¨  COMPLETED: Enhanced Enrollment Screening Process for Medicare Providers: Early

Implementation Results (OEI-03-13-00050) – Issued April 2016. ¨  COMPLETED: Part B Payments for 340B Purchased Drugs (OEI 12-14-00030) – Issued

November 2015.

28

OIG Update

¨  NEW: Outpatient Outlier Payments for Short-Stay Claims ¨  NEW: Skilled Nursing Facility Prospective Payment System

Requirements ¨  NEW: National Background Checks for Long-Term-Care

Employees ¨  NEW: Potentially Avoidable Hospitalizations of Medicare and

Medicaid Eligible Nursing Home Residents for Urinary Tract Infections

¨  NEW: Accountable Care Organizations: Beneficiary Assignment and Shared Savings Payments

¨  NEW: Medicare Home Health Fraud Indicators NOTE: 2017 OIG Work Plan Due Any Day!

29

MACRA

¨  Medicare Access and CHIP Reauthorization Act of 2015

¨  Begins January 1, 2017 ¨  Replaces Sustainable Growth Rate funding formula ¨  2,398 page document ¨  Meetings with nearly 100,000 people ¨  Close to 4,000 public comments ¨  “Landmark effort to move the healthcare system

forward” ¨  Transition – simple & flexible

31

MACRA

¨  Quality Payment Program ¤  Payment path 1 = Alternate Payment Models (APM)

n  Begins 2019 n  Increased financial risks/incentives

n  Performance n  EMR n  Reporting quality measures

¤  Payment Path 2 = Merit-Based Incentive Payment System (MIPS) n  More gradual path n  Lower financial risk/incentive n  -4% payment adjustment – Failure to submit 2017 quality data n  Allows physicians to “focus on patients not paperwork”

¤  Approx 380,000 clinicians exempted ¤  Provides $20 million each year for 5 years for training small practices

32

MACRA

¨  https://qpp.cms.gov/ ¨  Work in progress

¤  …evolve with practice of medicine ¤  …and with new medical technology

¨  “The bottom line is we are trying to get doctors back to what they do best, care for patients, through a lot of simplification and support…”

¨  “We view these coming years as the first steps into a program that will continue to improve, not an attempt to create a perfect system…”

33

QUESTIONS?

35

Jill Griffith, CPA, CPC Senior Manager - Health Care Services voice: 800.642.3601 e-mail: jill.griffith@actcpas.com