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ALJ Appellate Forum – What Therapy Providers Need to Know

February 8, 2014 4 Comments

The ALJ Appellate Forum on Wednesday, February 12th will be chock full of information that all outpatient therapy providers need to know.  Medical appeals formIf you have provided therapy over the $3700 caps (threshold) there is 100% RAC review of your claim(s).  Technically this is the OMHA Medicare Appellate Forum, but the provider industry has been quick to label it the ALJ Appellate Forum due to the significant backlog of appeals at the ALJ level, in large part because most providers involved in the appeals process as a result of RAC denials feel they have their best shot at the ALJ, 3rd level of appeals.

In a nutshell due to the significant increase in the number of appeals being filed (in large part due to the RAC program) and reaching the ALJ level, Chief Judge Nancy Griswold issued a letter in late December to those having a “significant number of appeals pending OMHA”.  The letter indicates that due to the current backlog the OMHA does not expect general assignment to resume for at least 24 months  and that they further expect post-assignment hearing wait times “will continue to exceed 6 months”.

The statistics are staggering, but the solution to clear the backlog is creating significant financial burden for large providers and small providers alike.   The letter announces the OMHA Appellate Forum, which, according to Judge Griswold, ” is to provide further information to OMHA appellants and providers on a number of initiatives underway and to provide information on measures we can take to make the appeals process work more efficiently”.

ALJ Appellate Forum – What Therapy Providers Need to Know

Therapy over the $3700 therapy caps (thresholds) is 100% subject to mandatory manual medical review.  CMS has turned this process over to the Recovery Auditors, and it is in effect through 3/31/2014 due to the SGR Legislation (the future is still uncertain, pending congressional action).  Some RAC rules apply, most do not.  Those in the 11 prepayment review states, wait to get their reimbursement pending a 10 day review and approval of the therapy provided over the $3700 caps by the RACs.  In the other 39 states, therapy providers are paid, then subject to mandatory post-payment review by the RACs.  The manual medical review system has not gone very well from the provider perspective, and it is likely that the RACs don’t like it either.  Most importantly providers that find their claims are denied have the right to appeal, and likely have started the process on 2013 claims, particularly in the pre-payment review states.  However in the post-payment review states many providers are getting bulk ADR request spanning several months (remember the RAC rule of ADR limits is not in effect for therapy MMR claims), and the prospect of getting their money recouped in the appeals process, and having it held for over 2 1/2 years might prove to cripple a small therapy practice.

Most therapy providers have never had their charts reviewed by a Medicare contractor, and now find a rude awakening when presenting records for RAC review.  If you are a provider in this situation, this likely be the first time that you use the Medicare appeals process.  The time you will spend learning about the process, filling out the forms, and preparing your case, may even cost you more than the reimbursement you will receive.

Therapy providers need to assess beneficiary utilization, carefully track the cap and the threshold, and ensure from the evaluation and first progress note moving forward that therapy is medically necessary, and more importantly that the medical record substantially supports evidence of medical necessity sequenced through the plan of care and subsequent progress reports.  If you are going to potentially have to wait 2 1/2 years for a hearing on a denied claim, it is essential that the medical necessity of skilled care be effectively demonstrated and documented.

While the agenda for the ALJ Appellate Forum has been posted, the “live” seats and the “remote” seats are no longer available.  I will be reporting live with the RAC Monitor team from the Appellate Forum.  RAC Monitor regular panelists Drew Wachler and Paul Spencer will be live onsite in Washington DC at the OMHA Appellate Forum.  Publisher Chuck Buck and I will be remote at our “anchor desk”.  We will have two live broadcasts from the forum (approved by HHS) with reports from Drew Wachler and Paul Spencer.  There will be a special edition preview of the OMHA Appellate Forum on Monitor Monday, February 10, 2014.  We honored to have Chief Judge Nancy Griswold as our special guest.  You can register for Monitor Monday, and our special broadcast from the OMHS Appellate Forum here.

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Nancy Beckley

Nancy J. Beckley MS, MBA, CHC: President-Nancy Beckley & Associates LLC. Compliance outsourcing, risk assessment, compliance plans, compliance training, auditing, due diligence, investigation support for therapy providers.

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Comments (4)

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  1. How is the above situation reasonable, justifiable, necessary, acceptable, fair, equitable, practical and supportive of quality, sound, patient-focused healthcare by reputable, honest, hard-working, compliant and still trying to be compliant practitioners. I have been audited 5 times and EVERY single audit resulted in no findings of fraud, abuse or neglect; 4 were Medical Manual Reviews that initially partly denied IN ERROR because of either incompetent or poorly trained reviewers. One auditor could not spell my name right after 5 attempts on my part to correct the mis-spelling first of first name and then of my last name. What I am interested in at this point is not what the auditors or investigators want but how I can join others to stop this riduculous, indiscriment group-punishment. Yes, I am inquiring about a class-action lawsuit if necessary to stop this madness. It seems more and more to me that Medicare has been taken over by Bean-counters and the Mafia, and now the Military (aka investigators and auditors) is involved. I am a law-abidding person who does not want to get caught in the cross-fire and I just want to keep doing my job well but without this time-wasting and scary craziness.

  2. Thanks for your comments Lise (second person I know with that spelling!). There is a huge difference between waste, fraud & abuse. The Recovery Auditors are ferreting out “overpayments” for providers that did not follow all the rules, or don’t have documentation supporting the rules, guidelines and statutes. There is broad congressional support for the RAC program as well as oversight for CMS via various program integrity contractors. The therapy constituency group (volunteer coalition of professional therapy associations) representing outpatient is not as cohesive and organized as the American Hospital Association or the American Medical Association – there is no single pot of money to collect data, analyze, research and respond as the hospitals, the AMA and the SNFs can). Given that OP therapy is provided in many venues (highest volume is in SNFs), the parent organization for OP is generally concerned over the bigger picture (hospital stays, SNF Part A stays), and in that mix, OP therapy not as high a revenue, so not a high focus.

    Unfortunately, from a public perspective, misguided documentation by providers for medically necessary services, is often mixed in the same pot with the shamsters that actually perpetrate a fraud upon Medicare through simple schemes of billing for services not provided, to elaborate schemes of “buying” Medicare numbers, “buying” physical therapy Plans of Care, and “buy” physicians to certify the POC. This gives all of therapy a bad name, that is undeserved.

    If you are an APTA member please contact them (contact me if you need specific folks to contact) and express your opinions.

    As an FYI – manual medical review was mandated by Congress on the recommendations of MedPAC (Medicare Payment Advisory Commission). If you read their reports, they suggest overutilization is the problem(which for Medicare – “waste”.)

    Thanks again for commenting.

  3. Thank you, Nancy. I have shared my opinion with APTA and my congressperson. My point in speaking up is always to encourage others to do so, too. At this time, there does not yet appear to me to be a balanced approach for ferreting out illegal or grossly abusive physical therapy practices from legal and compliant physical therapy practices. If a physical therapy practice has been repeatedly vetted by investigators and auditors who have determined the physical therapy practice is in compliance and justly providing medically necessary and justifiable services then why do these physical therapy practices have to continue to be subjected to the heavy administrative burdens created by these capitation audits–it has been over a year since these audits started and that should be enough time for the government to assess if a practice is compliant and legal; at this point further auditing really feels like harrassment to me. My time and the auditors’ time is better spent elsewhere.

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