Blog, Chirosecure Live Event March 19, 2021

The Medicare Appeals Process and How to Avoid It

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Hello everyone. Good afternoon. This is Michael Miscoe with Miscoe Health Law, and we’re here to have another, uh, ChiroSecure managing risk, uh, um, session this afternoon. I’m going to take about 10 minutes of your time. And today we’re going to talk about the Medicare Appeals Process and, uh, uh, how it works, uh, the costs and, um, uh, how you avoid, uh, an overpayment demand, uh, in the event that, uh, you get caught up in that process. Now, if you’re still billing Medicare, there’s a significant risk that at some point in time, you’re going to get audited, um, especially based upon what your profile looks like in terms of average visits per week, when that number gets too low, means your visits are stretched out, uh, and increases the likelihood, um, that they’re going to be able to determine that your care is maintenance care.

Um, care goes through long, too many visits per patient or per condition. Uh, the type of diagnosis. There’s a number of profile audits that they run, but the likelihood that you’re gonna, uh, bill Medicare, um, on a reasonably frequent basis and avoid a post-payment audit, um, is somewhat unlikely. Uh, it is possible, but, uh, there’s really no way to fly under the radar with Medicare. Um, although we will talk about, uh, some misguided risk mitigation strategies at the end, once you get audited by Medicare, the first thing that’ll happen is you’ll get a records request usually from what’s called a unified program, integrity contractor, and there are a number of those throughout the country. So depending on where you are, um, we’ll determine who your you pick is. It is possible that your own Medicare administrative contractor could start an audit. Um, but usually anymore they don’t, they defer the, uh, they send that stuff over to the pics and let them do the auditing.

Um, now the, uh, you pick will request records. Uh, usually it is what is called a probiotic, um, and they will request select records for certain patients and certain dates, uh, possibly they select claims, which will, if your claims include multiple dates, there may be, um, as many as 40 or 50 dates of service in a, uh, in a probiotic. Now, if they do a broader sample, what they call statistically valid, random sample, um, then you’re looking at potentially a lot more, uh, claims being involved in the record, but because, uh, the reason that they do that as they want to be able to project the error that they find in the sample to the entire universe at the sample was drawn from, and there’s a statistical process for doing that. Um, and, um, there are of course challenges as to whether they do it right or not.

But, uh, usually it’s very difficult to get one of those statistical projections overturned, even though we can find some air with those fine with their, their mathematical process. That being said, when you get a request, you have to look at it very carefully and, and look at, uh, an understanding that medical necessity is always on the table. You need to send all the records that pertain to the dates of service they’re requesting. So for example, if they pick patient Joe Smith and date of service, October 19th, 2019, uh, that patient may have been treated on that date. And I certainly expect that they would, and you would have the, the note for that, the treatment note for that visit, but it would be who view, because they’re going to evaluate medical necessity to look also at providing the, uh, initial evaluation for that course of care. Uh, any progress evaluations in the interim, uh, radiographs, all of the stuff that pertains to, uh, the entire course of care that the visit that they want is part of.

And, and as an analogy consider, I ask you for one page of the book, you send it to me, and then, uh, you wonder why I’m confused as to what the book’s about. So we want to definitely send the entire story. Now, if they’re asking you, uh, you do not want to send all the records back to the beginning of time. So some of these patients you may have seen for more than 10 years, uh, but what you need to do is identify when the condition that you were treating on the date that they’re asking for, when did it start provide that exam, uh, and, and plan of care. And hopefully you have that. Um, so once you get the record sent in, they’ll do what they do. They will publish what is called an initial determination. Okay. And initial determination is a letter it’ll usually come with a compact disc, a spreadsheet that has, um, um, their claim or service specific findings on it.

And, uh, um, with that, that tells us the specific reason that they denied each claim. So with that in mind, uh, once we have that, the next thing that’s going to happen, um, and there may be a provider education letter and, and some, uh, claim detail, findings, different, you pics do it differently, but, uh, once they publish their initial determination, a copy of that goes to your Medicare administrative contractor. Um, they will take those findings, put them back in their system and essentially reverse the payments. And that will generate, um, a, uh, what’s called an MMA nine 35 initial request, which is a payment demand letter in the vernacular. You might get one or more, even if it’s, even if it’s a small audit, they may break it up into multiple demand letters. Um, but you need to make sure that you have them all.

And when you do, um, your appeal timeframe starts, um, is based upon date of the earliest demand letter. So you’ll want to aggregate and appeal of course, but, um, you do not want to get into a situation where you’re appealing each claim individually because it’ll create a paperwork nightmare for you later on, or for your, for your lawyer. Uh, if you decide to get legal help, uh, once you submit, uh, now the way the timing works, uh, if you have the money, pay the money back, uh, as soon as possible interest starts accruing at ridiculous rates, uh, somewhere between nine and 10 and a half percent, uh, depending on where the CPI is at the moment and where the, uh, the, the prime interest rate is. But, uh, it is an exorbitant interest rate. So even if it’s a projected amount, and it’s a rather large number, if you have the resources, pay it back, if you can borrow the money, pay it back because commercial rates are less than what, what the government is going to charge you interest will start accruing 30 days beyond the date of the demand letter.

So even if we’re appealing, interests will continue to accrue. And because of the appeal timeframes, you don’t want that to happen because the interest amount will be substantial. When the issue was finally concluded at the administrative law judge level or beyond. Now that 30 day period is also significant because not only does it signal when interest starts to accrue, but it also signals when Medicare will begin recruitment. Um, so if you file your appeal within that 30 day timeframe, you will stop recruitment, but you will not stop interest. Now, the interesting thing is, is that the regulations give you a whole 120 days to appeal an initial determination. So to give us time or to give yourself time, to prepare an appeal, potentially get independent expert analysis. Um, what you usually do is if you pay the money back, then you don’t have to worry about recruitment at all.

Or if you can’t, then you hold your claims, uh, until we can get the appeal filed. And then once the appeal is filed, then recoupment will stop. Um, and then you can supposedly submit claims for a little bit, um, once the, uh, initial or the redetermination request goes in, that’s the appeal of the initial determination that goes to your Medicare administrative contractor? It will probably be rubber stamp denied. Uh, once that determination comes down, it’s due within 60 days of when they get it, then the next level is reconsideration again, 30 days to avoid, to file the appeal, to avoid recoupment. If you haven’t already repaid the money and, uh, you have 180 days otherwise to file that appeal. And usually we take the maximum amount of time and I’ll explain why later, um, once that appeal is filed, that goes to, what’s called a qualified independent contractor.

This is the second level of appeal. And that, uh, is either somebody like CTC, innovative solutions or Q2. Um, they will evaluate the appeal, most cases, a rubber stamp, whatever the initial determination said and issue their unfavorable determination at that point, uh, we have 60 days to file a request to the office of Medicare hearings and appeals, uh, for an administrative law judge hearing. Once the reconsideration comes down, if you have not paid the money back and you’re continuing to build claims, they will Institute recoupment. Uh, there’s nothing I can do to stop it. Um, if you are not submitting claims, we’ll start getting letters from, uh, treasury, the, uh, United States treasury, uh, to start repayment. Uh, and again, interest continues to accrue. I think it’s, uh, currently somewhere between nine and a half and 10%. So it’s a significant interest rates to try to avoid that if you can.

Now, once we file for an administrative law judge appeal, I am seeing, uh, smaller cases, a little probiotic cases. They’re coming back in about two years, uh, cases that I found 2019 are going to hearing now, uh, and they were filed in early 2019. So they’re about two years old. I have larger cases involving statistical projections, uh, that I found in 2015 that just went to hearings. So the timeframe, uh, how Omaha’s working off its backlog is, is a mystery. But, uh, so you’re probably looking at two to two to five years, potentially for an ALJ hearing, which seems like an enormous amount of time, uh, to, to waste, especially if it’s a pro botnet with a relatively small amount. So you may be asking why would you even bother to appeal it in the, in the first place? And the answer is, is because it’s not so much what they identified in the audit and a probiotic that I’m concerned about.

It’s the voluntary disclosure risk that, that audit creates under the, uh, fraud enforcement recovery act and the ACA changes to the social security act. Um, and more specifically the false claims act. They created this obligation to refund any overpayments to Medicare that you know, or should know about. And it’s the should know about part that gets a little tricky, uh, in the regulations, in the comments of the final regulations, relative to that rule. Medicare made it very clear that even an audit of a single claim can put you on notice of potential overpayments, thereby triggering an obligation for you to go investigate, uh, and identify any overpayments. And once they’re identified, you have 60 days to disclose and refund them. Otherwise they become per se false claims, which, um, you know, subjects you to trouble damages. So, um, we consistently, you know, 900, 1500, all our audits were in the past.

I would’ve just told the provider, write the check may correct. You know, do the corrective action go forth and send no more. We can’t do that because if we accept the audit result and then don’t do the disclosure and refund, which is a look back of six years, potentially. Um, even though they can only audit looking back five years presently, um, there is usually a significant, uh, overpayment disclosure liability if we accept the audit. And that’s why we appeal it. Having said that once you get, uh, the, the, the length of the process, um, effectively, even if we lose at the end, we’ve pretty much run out the disclosure liability for the time period of the audit and, and anything prior to that, because that period of time period, we’d be more than six years old. Um, so it, it, it was as much as four years old when, um, the audit was generated.

Um, it’ll be more than six years old by the time the audit is concluded because we’re going to spend a year, uh, going through the first two levels of appeal. We’ll spend another two years probably, uh, waiting for or longer waiting for a, um, an ALJ hearing. So even if we lose in the end, we solve the problem of our disclosure liability. And that doesn’t mean that we don’t care about the result we do. Um, especially if it’s, um, statistical projection, uh, and even those, even though they cover the period of the universe, they don’t cover the entire disclosure period. So even if your projection was a feasible number for you, it would not encompass your total liability. So an appeal is the only way we avoid that obligation now costs, um, you know, usually, uh, the process involving experts and that that’s where the real expense is.

And that expense varies depending on the structure and, and, uh, completeness of your records, uh, and how hard we have to look and where they’re at, the stations are necessary. There’s a whole bunch of factors that, that, uh, drive expert costs. Uh, but between experts and legal costs through an ALJ hearing without a statistical projection, easily 20 grand, it’s an expensive process because it is very methodical. Um, and sometimes the carriers don’t play by the rules. They change the reason for denial requiring more expert work. So it can be messy if there is a statistical projection and we need a statistician, then there’s a process of trying to get the information out of them, foyer requests, whatnot. Um, and there’s a whole lot more work and those ones can get a lot more expensive. Um, so, uh, that just gives you an idea how much we spend, even on a small audit, you know, when you have a couple of hundred thousand dollars worth of disclosure liability, uh, um, on your plate.

So that’s why we spend that kind of money. Now, I finally, I told you, I’d tell you about risk mitigation, read your LCDs in the Medicare benefit policy manual carefully. They have initial and subsequent visit documentation requirements, comply with them explicitly. Remember that just because a patient has a symptom doesn’t mean that we’re going to bill, they need a significant problem. It requires a course of care. Patients got to show up for it, but when you have a start in a finish, um, and you can demonstrate a objective measurable change, um, that is how you’re going to, uh, avoid, uh, liability. The final thing I’ll mention about the initial visit documentation requirements regarding a treatment plan, frequency duration, and they, um, they have specific goals and objective measures to evaluate treatment effectiveness. All the contractors that evaluate chiropractic claims have kind of morphed that into an obligation to create objective measurable goals, which is kind of silly, but, um, uh, that’s what they require.

So there you’ll have to kind of identify your associated neuromusculoskeletal conditions, identify their severity, like on a zero to 10 scale set goals. So if their cervical radiculitus is a seven, you want to get it to a three, you can couple it with outcome assessment, although those are subjective measures. Uh, so be careful relying on those exclusively. Um, if you have range of motion, of course that’s objectively and measurable. Uh, but usually that’s not always going to be a significant component of the problem. It can be in if it is, you can use it, but you’ll need to identify what your goals are. And then periodically throughout care, evaluate the patient and note the objective change. Uh, if I could tell providers one thing that you can do better to when medical necessity fights is quit re documenting the problem, we already know what it is all you need to focus on in subsequent visits and progress analysis is how your treatment changed the status of that problem.

And if you do that, you’ll be in much better shape, uh, be sure to document, uh, subluxation by part or x-ray, uh, explicit part documentation or explicit S x-ray findings that are, that are timely because you mess that up. That’s a statutory, uh, condition of payment and, and there’s not much we can do with it. Um, that’s about all we have time for. I know we went a little long today, but that’s a little bit deeper subject. Uh, I look forward to, uh, um, your, uh, continued participation in this Growth Without Risk series and next week, um, I think we have Dr. Sherry McAllister, uh, and she will have a riveting topic. I am certain thanks everybody. And have a great rest of your day.