Though the home health industry has pushed back against the Center for Medicare & Medicaid Services’ (CMS) prior authorization program—dubbed the Pre-Claim Review Demonstration for Home Health Services—the pilot is likely to start soon, and home health agencies are gearing up to deal with the potential of any additional administrative burden.
Agencies in the first five states of the demonstration—Illinois, Florida, Texas, Michigan and Massachusetts—should be aware of the new requirements immediately, but the program is likely to eventually spread throughout the country. The states were selected based on rates of fraud, but the industry overall had a high rate of improper Medicare billing—59%—in 2015, according to CMS.
“The five states were selected because there was a higher incidence of fraud and abuse in these states,” Gina Mazza, RN, BSN and partner at Fazzi Associates, said during a webinar about the demonstration. “You can expect that what is getting tested here is likely to get rolled out to everyone.”
The first demonstration will be rolled out in Illinois and could begin after August 1, 2016. With the program launch date coming up quickly, there are a few things home health agencies can do to be prepare for the changes and reduce the likelihood of delayed or denied reimbursement payments.
The demonstration aims to crack down on fraud and improper billing by having agencies prove that home health care services are medically necessary earlier in the process. Agencies will be required to submit a pre-claim to CMS with a tracking number of the care episode along with the demonstration that home health services are medically necessary. A pre-claim for a 60-day episode of care can be submitted anytime before an agency submits a final claim.
While the documentation requirements are clear and unchanging from current requirements of demonstrating medical necessity, there are some additional processes that home health agencies can undergo to improve the chance of their documents being accepted more quickly.
“Aside from the documents, think about how you are presenting this,” Mazza told home health agencies during the webinar. “Make it easy for the [CMS] reviewer. You’re sending a document that you want affirmed and approved demonstrating that you are following coding rules.”
To do so, Mazza suggested including a cover with the documents so CMS knows who is sending the documents and what cases are included within the submission.
It’s also essential that home health agencies follow the documentation descriptions to the letter. This is crucial for demonstrating the homebound clause that deems home heath care services medically necessary for patients. For example, documenting that an activity requires a “taxing effort” for a patient may not prove that they are homebound. Furthermore, demonstrating the “skilled need” is not always clear in documentation, Mazza said.
“At times, it’s not descriptive enough,” Mazza warned. “It’s not always obvious why the skilled need is there and why it’s specific to that patient.”
Above all, home health agencies should think about how to demonstrate why and how home health care is medically necessary for each patient’s claim. Doing so will likely reduce the chances that pre-claims will not be approved right away, Mazza advised.
Track and Re-Submit
An important clause in the pre-claim demonstration has to do with the submission order and process. Agencies must submit a pre-claim review within the requested time frame before they can submit a final claim and be paid by CMS. If the pre-claim is not approved, an agency can refile as many times as it takes to get the right documentation to CMS. CMS has maintained they will respond to the initial pre-claim submissions within 10 days and resubmissions within 20 days.
However, if an agency submits a final claim before the pre-claim is approved, they may still be approved. CMS could also deny the final claim for improper documentation. If the final claim is approved without prior authorization, the home health agency will see a 25% reduction in their reimbursement. This reduction is waived during the first three months of each demonstration for a grace period, so that agencies can get used to the new process.
To avoid reduced payments, agencies must ensure they have a system in place to track each case within the claims process, according to Mazza.
“There is absolutely work to do here,” Mazza said. “It’s up to the agency to respond and resubmit. Please be sure you have a very good tracking system. You’ve got to know which episodes you’ve submitted and where you are in the pre-claim process.”
Staying on top of the claims process and cases will better enable an agency to follow the new compliance process.
While the pre-claim pilots are starting soon for just a sect of the larger home health agency, the program is part of a larger shift of a changing health care environment.
“This kind of thing isn’t going away,” Mazza said. “The entire industry is in a transformational phase.”
Written by Amy Baxter