Get documents about "PowerPoint Presentation
Document Sample
Virginia Physical Therapy
Association
2012 Annual Conference
Health Care Reform
Gillian Russell, JD
Senior Regulatory Affairs Specialist
American Physical Therapy Association
HCR / Goal of Integrated Care
Three Part Aim
Better Care
(Individuals)
Lower
Better Health
Growth in
(Populations)
Expenditures
Emerging Themes in Health Care
• Accountable Care Organizations
Integrated Models of Care
• Medical Homes
– Innovation in Programs
• Bundling
• Prevention and wellness, Medicaid
Expansion of Coverage expansion, exchanges,
nondiscrimination
• Cuts in payment rates, refinements to
Refining / Changing
Payment Methodologies payment systems, patient assessment
instruments.
Linking Payment to Quality • Value based purchasing, hospital
readmissions policy, electronic health
records, registries
• Provider Enrollment
Program Integrity • Funding Increases for Enforcement
• Expansion of Audits (RACs)
Timeline of Key Health Reform Provisions
Collaborative Care Models:
Accountable Care
Organizations
(ACOs)
What is an Accountable Care Organization
(ACO)?
Networks of physicians, hospitals and
other providers that will be incentivized
to work together to provide quality care
and lower growth in health care costs
under Medicare FFS
Goal is to provide seamless, high quality
care instead of fragmented care in the
current FFS model
ACO Final Rulemaking
OIG Fraud and
Abuse Waivers
CMS Medicare FTC Anti-trust
Shared Savings Enforcement
Final Rule Statement
Advanced
Payment Model IRS Fact Sheet
Highlights of MSSP Final Rule
Adds FQHCs and RHCs as ACO eligible
providers
Changed patient assignment to a prospective
process
Quality reporting program changed to 33
measures around 4 domains
Modified risk models to include one model in which ACOs
share in savings only; 2nd model ACOs share in small
proportion of losses but larger proportion of savings
Removed requirement that PCPs must meet
EHR “meaningful use” criteria
ACO Multiple Pathways
CMMI
Pioneers
MSSP
Track 1
Track 2
Advance
Payment
ACO Resources
•116 MSSP ACOs
•32 Pioneers
•20 Advanced Payment
Eligible Participants
1. ACO Professionals in Group Practice
Arrangements
2. Networks of Individual Practices of ACO
Professionals
3. Partnerships or Joint Venture Arrangements
Between Hospitals and ACO Professionals
4. Hospitals Employing ACO Professionals
5. Critical Access that bills for facility and
professional services
6. Federally Qualified Health Centers
7. Rural Health Clinics
ACO Definitions
ACO Participants ACO Professionals ACO Providers/
Suppliers
Individual or Groups of ACO provider/supplier Enrolled in Medicare
ACO and bills Medicare
providers/suppliers FFS
Identified by Enrolled and bills Has a Medicare billing
Medicare-enrolled TIN Medicare FFS number assigned to
ACO participant and
listed on ACO legal
forms
Alone or together with Physician PTPPS
other ACO participants Physician Assistant HHAs
make-up an ACO Nurse Practitioner SNFs
Clinical Nurse Rehabilitation
Specialist Agencies
ACO Structure
• Formal and legal structure and allows the ACO
to receive and distribute payments for shared
savings
• Formal CMS application and approval process
• Representatives from Medicare FFS
beneficiaries and each ACO provider/
participant
• Allows for partnering with private entities but
ACO participants must have at least 75 percent
control of the ACO’s governing body
ACO Structure
• Evidence-based medical practice or clinical
guidelines
• Three-year contractual commitment
(remedial actions for removing participants
for non-compliance)
• 5000 yearly patient threshold
• Participation voluntary for providers and
patients
Establishing a Benchmark
• Current Medicare FFS payment
• Shared savings payments directly to the ACO
• Benchmark developed to assess performance
• An estimate of total Medicare FFS Parts A and
B costs if provided absent ACO
• Benchmark factors in patient characteristics,
geographic location, etc.
• Benchmark updated each year of the three-
year period
Risk Models
• Minimum savings rate based on percentage of
the benchmark that the ACO must exceed
• ACOs must opt into one of two risk-sharing
models:
– One-sided Risk (up to 50% shared savings
and <10% of benchmark)
– Two-sided Risk Model (up to 60% shared
savings and <15 percent of benchmark, up to
10 % shared losses)
Beneficiary Assignment
• Plurality test for determining beneficiary
assignment to an ACO
• Whether a beneficiary receives more
primary care from that ACO than from
any other provider
ACO Quality: The Measures
• Total of 33 measures (scored as 23)
– 4 domains
• Better care for individuals
• Better health for population
– 4 methods of data submission
• Patient survey
• Claims
• EHR
• Group Physician Reporting Option (GPRO)
• Measures will be phased in from pay for reporting to pay for
performance
ACOs and Quality
• Quality reporting overview:
– ACOs must report and meet quality measure
standards for the contracted three years
• Quality reporting will include mix of measures:
– Evidence-based care process
– Outcome
– Patient experience
• CMS did not include utilization measures as the
ACO program will address this through improved
coordinated and quality
ACO Quality Reporting: Therapy
Considerations
Possible Opportunities
• Therapists can participate in value-based purchasing
and quality initiatives
• Identifying quality measures that PT’s can directly
impact
• PT’s will remain eligible under the PQRS program even
if participating in an ACO
Possible Challenges
• Physical Therapists cannot report in PQRS through the
ACO (GPRO)
Interim Final Rule on Fraud and
Abuse Waivers
• 5 final waivers:
1. ACO pre-participation
2. ACO participation
3. Shared Savings Distribution
4. Compliance with Physician Self-referral Law
5. Patient incentive
• Applies a “reasoned approach analysis”
• Existing exceptions and safe harbors still apply
Anti-trust Enforcement Policy
• Establishes an anti-trust “safety zone”
– Combined share of 30% or less of each
combined service PSA
– Exception for rural ACOs
– “Safety Zone” designation stays in effect
for duration of ACO agreement
• ACOs outside of “safety zones” not
necessarily unlawful
Private ACO Collaborations
Brookings/Dartmouth Anthem Blue
ACO Pilot Sites Cross/Blue Shield
Aetna CIGNA
Partnerships
with
Hospitals &
State
Government
Medicare
Shared
Savings
Program
Private
CMMI
Payer
“ACOs”
ACOs Activity
State
activity
Dispelling the Myths
Myth Reality
ACOs are the same as ACOs have significant
the HMOs of the 1990s quality, governance and
ACOs will replace marketing requirements
Medicare FFS and Providers will still submit
providers will be paid by claims to Medicare
the ACO
Patients/ providers can
Patient choice is taken receive care outside ACO
away
ACOs do not affect Stark
ACOs widen the door for IOAS exception but does
POPTs pose significant issues
Physical Therapy Considerations
Possible Opportunities Possible Challenges
• Less fragmented, more • Costs and complexity of
integrated care for patients electronic health record
• Providers practicing “at the top adoption and integration
of their license” • Adoption of evidence-based
• Cost savings may encourage clinical standards
more direct to PT visits, • Adoption of care management
referrals, & PT primary care and utilization standards
• Should reward PT clinical • Ability to deal with complex
expertise and professional contracting requirements
capability • Maintenance of autonomy
• Right provider for the right within networks and pressures
patient at the right time for consolidation
What Do ACOs Mean for PT
Practice?
ACO
Physical Physical
Therapists Therapists
Practicing Practicing
Outside of Within ACO
ACO Model Setting
Is an ACO Partnership Right for Your
Practice?
• Determine the desired role, if any, for your
Analyze practice in an ACO
• Prepare adequately for this partnership---
Plan or develop a plan for success outside of
the ACO structures
• Advocate for a role for your practice in these
Implement new models---or pursue a strategy for
success outside of the ACO structure
• Conduct ongoing assessment of business
Evaluate metrics and modify course as needed
CMS Resources
CMS Shared Savings Program
http://www.cms.gov/Medicare/Medicare-Fee-for-
Service-
Payment/sharedsavingsprogram/index.html?redi
rect=/sharedsavingsprogram/
CMMI Pioneer and Advanced Payment Model
http://innovations.cms.gov/initiatives/ACO/index.
html
Key Points for Therapists
• Can contract with multiple ACOs
• ACO activity and composition will vary
• ACOs are voluntary
• ACO final rules do not relax Stark II IOAS
exception
• Know differences in MSSP, Pioneer, and Private
ACOs
• Participation in quality initiatives and collection of
outcomes data is crucial
• Assess interoperability of current and potential
EMRs
Collaborative Care Models:
Bundled Payments
Section 3023 of ACA: Bundling
• Bundling Pilot Project – national, voluntary pilot program
• Hospitals, physicians and post-acute care providers
(SNFs, home health, IRFs, and LTCHS)
• Improve patient care and cost-savings through bundled
payment model
• Must be established by 2013 and will last for five years
• Episode of care: 3 days before admission to hospital,
through LOS, and end 30 days post discharge
• Based on eight selected conditions
• Quality measures/assessment tool to be established
• Medicaid bundled payment demo to take place in eight
states
CMMI: Bundling Payment
Initiative
• Designed to encourage doctors, hospitals and other
health care providers to coordinate care
• Objectives:
– Support and encourage providers through three part
aim
– Decrease the cost of an acute episode of care and the
associated post-acute care while improving quality
– Develop and test new payment models for three-part
aim
– Shorten the cycle time for adoption of evidence-based
care
Bundling Initiative: Four Proposed Models
Relationship between Bundling
Initiative and Pilot Project
• Bundled Payments for Care Improvement
initiative is a separate activity
• Consistent with goals of National Pilot
Program on Payment Bundling authorized
by ACA
• Bundled initiative will help inform future
work under the pilot project
Definition of Bundled Payments
• Single payment made for a defined group of
services.
• May cover services furnished by a single entity
or items and services furnished by several
providers in multiple care delivery settings.
• Single negotiated episode payment of a
predetermined amount for all services.
• Paid prospectively or retrospectively.
Source: CMMI Website FAQs
Example Bundled Payment
• Medicare and the provider would agree to a
bundled payment target price for acute care
hospital services for an inpatient stay plus
professional services and post-acute care
related to the principal reason for the
hospitalization, rather than paying separately
for each physician visit and procedure
provided during the episode.
Bundling Key Focus: Reduction in
Hospital Readmissions
• Implementation of reduction measures in key
acute and post acute care settings:
– Inpatient hospitals
– Inpatient rehabilitation facilities (IRF PPS 2012)
– Transitioning focus in home health, skilled
nursing facilities, and LTCHs
• Private initiatives define readmissions –
United Healthcare and Geisinger
Hospital Readmissions
Reduction
• The Patient Protection and Affordable
Care Act (PPACA) established the
Hospital Readmissions Reduction
Program.
• Begins in 2013, and is aimed at adjusting
hospital payments for those institutions
that have higher than expected
readmissions.
Hospital Readmissions
Reduction Program
• Program to reduce payments for facilities
exceeding certain rate of readmissions
– Proposed Rule: August 18, 2011
– Implementation: October 2012
• Condition specific 30-day readmissions
– Acute myocardial infarction (AMI)
– Heart failure (HF)
– Pneumonia (PN)
Hospital Readmissions
Reduction Program
• Additional conditions to be added
– As determined by Secretary for FY2015
– Chronic obstructive lung disease, coronary
bypass grafting, percutaneous coronary
interventions, other vascular procedures (as
identified in 2007 MedPAC report)
• P4P
– Withholdings up to 1% FY2013, 2% FY2014,
and 3% FY 2015 and beyond
Additional Readmissions Measures
APTA Readmissions Efforts
• Increased member education regarding through a variety
of educational sessions including:
– The Value of Physical Therapy in Reducing Avoidable Hospital
Readmissions (audio conference)
– Medicare update presentations (CSM & Annual Conference)
– Coding, Payment and Practice Applications Seminars
• Creation of new readmission page on the website:
http://www.apta.org/HospitalReadmissions/
• Submission of comments by APTA on a variety of
payment regulations and measurement methodologies
related to readmissions
Collaborative Care Models:
Patient-Centered
Medical Homes
(PCMHs)
Medical Homes
• Redefining primary care
• Primary care medical home accountable for
meeting the large majority of each patient’s
physical and mental health care needs
• Prevention and wellness, acute care, and
chronic care
• Team approach: physicians, nurses, physical
therapists, pharmacists, nutritionists, social
workers, etc.
Medical Homes:
Affordable Care Act
• Sec. 2703 established person-centered health
home for State Medicaid and other programs
• Individuals with chronic conditions
• PTs not specifically named in statute but can
partner with state entities to participate
• Sec. 3502 provides grants to “eligible entities”
to establish community-based health teams to
support primary care providers in the creation
of PCMHs
Medical Homes:
Beyond the ACA
• CMMI Challenge Grants
– Up to $1 billion in grants for delivering better health,
improved care and lower costs to people
• CMMI FQHC Advanced Primary Care Practice
• Private Partnerships
– Geisinger Health System
– Group Health, Seattle
– TransforMED National Demonstration Project
Patient-Centered Medical Home
Functions and Attributes
Source: AHRQ Patient Centered
Medical Home Resource Center
Harris County Hospital (Houston, TX)
NCQA distinction as PCMH
Collaborative Care Resource Center
• Evolving resource center designed for
physical therapists to gain a better
understanding of where PTs fit in
integrated models of care
• Practice Applications: discover lessons
learned from colleagues currently
engaging in new delivery models
• Summary and analysis of federal
rulemaking and how it impacts PT
• http://www.apta.org/CollaborativeCare/
• Communities Discussion Board
51
HCR Implementation:
Health Insurance Exchanges
Health Insurance Exchanges
• Section 1311 of ACA establishes health
insurance exchanges
• State implementation by 2014
• Centralized marketplace where individuals
and small businesses can purchase
coverage
• One-stop shop web portal
State Health Insurance Exchange
• Financially stable – must be self-financing by January 1, 2015
– Federal grants until then
• VA and Federal Funding:
– September 2010: Virginia State Department of Medical
Assistance Services received a federal Exchange Planning grant
of $1 million.
– VA planned to submit a Level One Establishment grant
application in June 2012; however, the Governor announced in a
letter to the Legislature in July, he decided not to submit the
application.
– VA is one of 9 states receiving technical assistance from the
Robert Wood Johnson Foundation through the State Health
Reform Assistance Network
• This assistance includes help with setting up health insurance
exchanges, expanding Medicaid to newly eligible populations,
streamlining eligibility and enrollment systems, instituting insurance
market reforms and using data to drive decisions
HHS Rulemaking on Exchanges
• Establishment of Exchanges and Qualified
Health Plans (QHPs)
• Standards Related to Reinsurance Risk,
Risk Corridors and Risk Adjustment
• Exchange functions in the Individual
Market: Eligibility Determinations;
Exchange Standards for Employers
Coverage under the Exchanges
• Coverage for all individuals
– Individual mandate: All individuals must have
insurance by 2014
• Coverage facilitated by:
– Tax credits for premiums
– Subsidies for out-of-pocket costs
– Medicaid expansion
• Qualified health plan (QHP) coverage
– Essential Health Benefits
Tax Credits and Subsidies
Slide Source: The Commonwealth Fund presentation, “Achieving and Maintaining Near Universal Coverage Under
the Affordable Care Act: Key Issues For Federal and State Policy Makers”
Exchange Development
Timeline
Slide Source: Avalere Health LLC presentation “Understanding State Efforts to Implement Exchanges”
July 18, 2011
Status of State Legislation to Establish Exchanges,
As of May 2012 NH
WA VT ME
MT
ND
AK
MN
OR NY
ID WI MA
SD RI
WY MI CT
PA
IA NJ
NV NE OH
IN DE
IL
UT WV MD
IA VA
CA CO DC
KS MO KY
IL
WV NC
TN VA
AZ OK SC
NM AR
GA
AL
MS
HI LA
TX
FL
State exchange in existence prior to
passage of ACA
Legislation failed/no gubernatorial action
Legislation signed into law post passage of ACA
Legislation signed: intent to establish an Governors pursuing non-legislative options
exchange, creation of study panel or appropriation Governors working with HHS on options
Legislation passed one or both houses Governor veto or decision not
to establish exchange
Legislation pending in one or both houses
No legislative activity to date
Source: National Conference of State Legislatures, Federal Health Reform: State Legislative Tracking Database.
http://www.ncsl.org/default.aspx?TabId=22122; Politico.com; Commonwealth Fund Analysis.
Significant State Flexibility
• Nationwide standard for:
– Enrollment period
– Approval for state exchanges
• Some national standards for:
– Streamlined applications and eligibility
decisions
– Governance structure
• West Virginia vs. California vs. Maryland
– Subsidiary and regional exchanges
– SHOP Employer/Employee Choice Model
Significant State Flexibility
• Some national standards for:
– Exchange consumer tools
– Navigator program
– Requirements for QHP offerings
– Network requirements
• States completely flexible on:
– Health plan selection process
• Utah vs. Massachusetts
– Network adequacy standards
– Marketing requirements
– Agent and broker roles
• Waivers?
Snapshot of State Exchanges
Utah
Massachusetts
• Virginia: http://www.healthinsurance.org/
Essential Health Benefits
• Comprehensive set of services and items that must be
offered in the qualified health plans within the Exchange,
Small Business Health Options Program, and Medicaid
expansion
– Ambulatory patient services
– Emergency services
– Hospitalization
– Mental health and substance abuse services
– Rehabilitative and habilitative services and devices
– Prescription drugs
– Laboratory services
– Preventive and wellness services and chronic disease management
– Maternity and newborn care
– Pediatric services
Flexibility for States’ EHBs
• Institute of Medicine (IOM) issued reports
advocating for flexibility in EHB definitions
• HHS Bulletin: December 16, 2011
– States will choose benchmark plan from the
following health insurance plans:
• One of the three largest small group plans in the state by
enrollment;
• One of the three largest state employee health plans by enrollment;
• One of the three largest federal employee health plan options by
enrollment;
• The largest HMO plan offered in the state’s commercial market by
enrollment.
Rehabilitation and Habilitation
Definitions under EHBs
• National Association of Insurance
Commissioners (NAIC) definitions:
– Rehabilitation Services: Health care services that help a person keep,
get back or improve skills and functioning for daily living that have been
lost or impaired because a person was sick, hurt or disabled. These
services may include physical and occupational therapy, speech-
language pathology and psychiatric rehabilitation services in a variety of
inpatient and/or outpatient settings.
– Habilitation Services: Health care services that help a person keep,
learn or improve skills and functioning for daily living. Examples include
therapy for a child who isn’t walking or talking at the expected age.
These services may include physical and occupational therapy, speech-
language pathology and other services for people with disabilities in a
variety of inpatient and/or outpatient settings.
Rehabilitation and Habilitation
Definitions under EHBs
• Mosby’s Medical Dictionary:
– Habilitation: the process of supplying a person with the means to
develop maximum independence in activities of daily living
through training or treatment.
• IOM Report:
– Congressional floor statement advocating broadly based
interpretation for rehabilitation, habilitation and devices, including
“items and services used to restore functional capacity, minimize
limitations on physical and cognitive functions, and maintain or
prevent deterioration of functioning”
– Advocates for children suggest modeling medical necessity after
EPSDT coverage rules, “allowing a child to accommodate to a
condition and reach his/her highest level of functioning”
APTA Efforts on Exchanges/EHBs
• Comments submitted to HHS in response to
IOM report, Essential Health Benefits: Balancing
Coverage and Cost
• Comments submitted to HHS in response to
Establishment of Exchanges and Qualified
Health Plans proposed rule
• APTA Website created for EHB and Exchanges
– Member education
– State chapter advocacy tools
EHB Advocacy Principles
• Generally, rehabilitation services may
include:
– Diagnosis and management of movement dysfunction and
human performance to enhance physical and functional abilities;
– Skilled interventions to address functional limitations,
impairments and disabilities that diminish an individual’s quality
of life, health status, or independence in activities of daily living.
Restoration, maintenance and promotion of optimal physical
function; and
– Prevention and management of the onset, symptoms, and
progression of impairments, functional limitations and disabilities
that may result from disease, disorders, conditions or injuries.
EHB Advocacy Principles (cont.)
• Rehabilitative services should be provided
by qualified health care professionals
currently authorized under federal law
• No absolute limits on the provision of
rehabilitation services
– No restriction on the number of therapy visits
in EHB packages without allowing exceptions
– No limit on annual visits
EHB Advocacy Principles (cont.)
• Devices should be a covered benefit
• Defining medical necessity:
– Health care practitioners should determine
what method, scope or type of treatment is
medically necessary
• Allow latitude for treatment variations while
balancing costs
• Actuarial data should be utilized if certain
limits are allowable
EHB Advocacy Principles (cont.)
• Individual and community education and
consumer choice
• If states have flexibility, appropriate education
should be provided to ensure all stakeholders
are aware of the minimum federal requirements
and how to obtain information regarding any
additional state requirements
• Planning grants and technical assistance could
mitigate the impact of financial strain
• Plan Rating System
Virginia Health Insurance
Exchange
• April 6, 2011: Governor Bob McDonnell (R)
signed HB 2434 into law, declaring the state’s
intent to establish a health insurance
exchange
– Based on a recommendation by the Virginia Health
Reform Initiative Advisory Council
• November 25, 2011: Advisory Council’s
exchange recommendations were submitted
to the General Assembly by the Governor
Virginia Health Insurance
Exchange
• Council voted in favor of establishing a state-
based exchange as a quasi-governmental
agency with a governing board.
• Council recommended the exchange follow
the state’s existing conflict of interest
guidelines, maintain administrative flexibility
in hiring, compensation, transparency and
procurement, and appoint 11 to 15 board
members.
Virginia Small Business Health
Options Program (SHOP)
• Advisory Council recommended that
Virginia:
– Limit the size of the SHOP exchange to
employers with up to 50 employees in 2014
– Maintain one administrative structure for both
the individual and SHOP Exchange, but keep
the risk pools separate
Virginia EHB
• Advisory Council recommended in June 2012
that a subcommittee be established to
consider Anthem, the state’s small-group
PPO as the state’s benchmark plan.
• The subcommittee recommended Anthem as
the EHB benchmark plan and the Children’s
Health Insurance Program (CHIP) dental
benefit plan (Smiles for Children) as the
pediatric dental supplemental plan
Virginia Information Technology
• Focus on a significant Medicaid IT system
upgrade and has received approval from the
CMS for an enhanced federal match.
• May 2012: released a Request for Proposals
soliciting subcontractors to streamline eligibility
and enrollment for all existing social service
benefits, including Medicaid, TANF, and food
stamps.
– State officials envision eventual interoperability
between the upgraded system and an exchange.
Virginia: Next Steps
• VA has declared a preference for a state-
based exchange as opposed to a federally
run exchange
• Must submit declaration letter signed by the
Governor and an application to HHS by Nov.
16, 2012
• VA has until Jan. 1, 2013 to create state-
based exchange that HHS approves fully or
conditionally.
HCR Implementation:
Medicaid Expansion
Medicaid Expansion
• Jan. 1, 2014: ACA expands Medicaid to
include individuals between the ages of 19
up to 65 (children, pregnant women,
parents, and adults without dependent
children) with incomes up to 138% FPL.
• CMS has stated that states may “decide
whether and when to expand, and if a
state covers the expansion group, it may
later drop the coverage.
Impact of SCOTUS Decision
• Between now and 2014, states will determine whether to
implement the ACA’s Medicaid expansion and receive
the associated enhanced federal matching funds
• CMS has stated:
– States may “decide whether and when to expand, and if a state
covers the expansion group, it may later drop the coverage.
– No deadline yet by which states must tell CMS of Medicaid
expansion plans (though Exchange blueprint to HHS by Nov. 16)
• Court decision does not impact reduction to DSH
payments
Initial State Plans for Medicaid
Expansion
Virginia and Medicaid Expansion
• Gov. Bob McDonnell considering opting
out of Medicaid expansion
– Letter to legislators in July 2012, considering
opting out, stating that he needs more
information
– Potential repeal of law after election
Beyond HCR:
Medicare Therapy Cap Updates
2012 Therapy Cap
• For 2012, the therapy cap amount is $1880 for PT and
SLP combined and a separate $1880 cap for OT.
• Therapy cap does not apply in outpatient hospitals.
• Medicare Advantage plans do not have to implement a
therapy cap.
• Exceptions process will be in effect until December 31,
2012.
• If your patients exceed the therapy cap, you may submit
the claim with a KX modifier (if services are medically
necessary) until December 31
• Congressional action is necessary to extend the
exceptions process
84
2012 Therapy Cap: Hospitals
• The therapy cap has applied in the past to all
outpatient therapy settings except hospitals.
• Starting October 1, 2012 the therapy cap with an
exceptions process will also apply to hospital
outpatient settings. (critical access hospitals are
exempt)
• Hospitals would no longer be subject to the therapy
cap after December 31, 2012 unless Congress
extends the provision in future legislation.
85
Therapy Cap: Exceptions
• January 1-October 1, 2012: an automatic exception to
the therapy cap may be made when documentation
supports the medical necessity of the services beyond
the cap. Providers should use the KX modifier.
• October 1, 2012-December 31, 2012: an automatic
exception may be made for claims between $1880-
$3700 (use KX modifier)
• October 1, 2012-December 31, 2012: Claims exceeding
$3700 in expenditure will be subject to manual medical
review to be paid
86
Therapy Cap: Manual Medical
Review
• Starting October 1 for claims exceeding $3700
• All therapy services beginning January 1, 2012
count toward the therapy cap amount in
calculating the $3700.
• CMS issued guidance on manual medical review
in a fact and question and answer document.
87
Therapy Cap: Manual Medical
Review
• Phase I providers: Subject to manual medical
review from October 1‐December 31, 2012.
• Phase II providers: Subject to manual medical
review from November 1‐December 31, 2012
• Phase III providers: Subject to manual medical
review from December 1‐December 31, 2012.
• List of NPIs and phases to which they are
assigned is available at:
https://data.cms.gov/dataset/Therapy-Provider-
Phase-Information/ucun-6i4t
Therapy Cap: Manual Medical
Review
• If a provider does not request advanced
approval prior to providing services over
$3700, payment for the claims will stop
and a request for medical records will be
sent to the provider.
• The provider will be subject to prepayment
review for those claims and the time frame
for review will be approximately 60 days.
APTA Resources for Therapy
Cap Changes
• http://www.apta.org/Payment/Medicare/Th
erapyCap/2012/Changes/
– FAQ
– Webinar
– Podcast
– List of links to all MACs
– Complaint form
CMS Resources for Therapy Cap
Changes
• A transcript of a special open door forum
held by CMS on the manual medical
review process is available at the link
below: (http://www.cms.gov/Outreach-and-
Education/Outreach/OpenDoorForums/Do
wnloads/080712TherapyClaimsSODFAnn
ouncementTranscriptAudio.pdf)
• Questions may be emailed to:
therapycapreview@cms.hhs.gov.
CMS Resources for Therapy Cap
Changes
• Medicare Benefit Policy Manual
– http://www.cms.gov/Regulations-and-
Guidance/Guidance/Manuals/downloads/bp102c15.pdf
• Medicare Claims Processing Manual, chapter 5
– http://www.cms.gov/Regulations-and-
Guidance/Guidance/Manuals/downloads/clm104c05.pdf
• Centers for Medicare and Medicaid Services
– www.cms.hhs.gov
– CR 6660: http://www.cms.hhs.gov/transmittals/downloads/R1860CP.pdf
– CR 5871, Pub. 100-04, Transmittal 1414
– Transmittal 2537 CR 7881 (August 31, 2012)
http://www.cms.gov/Regulations-and-
Guidance/Guidance/Transmittals/2012-Transmittals-
Items/R2537CP.html
– Transmittal 1117; CR 8036 http://www.cms.gov/Regulations-and-
Guidance/Guidance/Transmittals/2012-Transmittals-
Items/R1117OTN.html
Beyond HCR:
Reporting Functional
Information on Medicare Claims
Reporting Functional Information
on Claim Form
• By 2013 CMS will implement a claims
based data collection strategy designed to
collect data on the claim form about
patient function.
• Proposal included in 2013 physician fee
schedule rule.
94
Reporting Functional Information
on Claim Form
• Comment deadline: September 4
– APTA submitted extensive comments
• Involves reporting of G codes regarding
functional limitation accompanied by a
severity modifier.
• CMS proposes the use of tools and
translation of the scores from those tools to
determine the level of impairment and
severity modifier reported.
• Final rule will be published November 1, 2012
Functional Limitation Reporting
Functional Limitation Reporting
MedPAC report
• MedPAC must submit a report on how to
improve the outpatient therapy benefit to
Congress by June 15, 2013.
• MedPAC discussed outpatient therapy at
March 2012 meeting, September 7
meeting, and October 5 meeting
HCR Initiatives:
Program Integrity
Improper Payments Under Medicare
• For fiscal year 2010, HHS reported almost $48
billion in Medicare improper payments, (38
percent of the total $125.4 billion estimate for
the federal government)
• Medicare Fee for Service error rate in 2010 was
around 10.5% ($34.3 billion)
• Governments goal is to reduce the Medicare
FFS improper payment rate to: 8.5% by Nov
2011 and 6.2% by Nov 2012
Improper Payment
• Improper Payment: Any payment to the
wrong provider for the wrong services or
in the wrong amount
• Overpayments and underpayments
– Didn’t meet the statutory coverage
requests
– Didn’t meet the Medical necessity
requirements
– Incorrectly coded
– Didn’t submit sufficient documentation
Program Integrity Efforts
• More coordination among Agencies
– CMS, Office of Inspector General, Department of
Justice, FBI
• Use of Program Safeguard Contractors, Zone
Program Integrity Contractors (ZPICs), Recovery
Audit Contractors, HEAT (DOJ-FBI-HHS Strike
Forces)
– HEAT is focused on: Detroit, Houston, Brooklyn, Tampa and
Baton Rouge, Dallas, Chicago
• Increased Ability to Detect Aberrant Billing
(collecting near real time data)
• Increased Focus on Physical Therapy Services
Strategies to Reduce Improper
Payments
Provider Enrollment
• Enrollment Screening:
– ACA requires that HHS and OIG establish
screening procedures for providers/suppliers
– Level of screening varies among categories
of providers/suppliers based on risk of fraud
and abuse
– Screen can include:
• Licensure checks, fingerprinting, criminal
background checks, site visits, etc.
• Final Rule Issued Feb. 2011
Limited Moderate High
-Physician or -CORFs Newly Enrolling
-
nonphysician -Physical Home Health
practitioners, therapists enrolling Agencies
occupational as individuals or -Newly Enrolling
therapists, speech groups in private DMEPOS
language practice suppliers
pathologists, -Revalidating
medical groups or home health
clinics agencies
-Hospitals -Revalidating
-SNFs DMEPOS
suppliers
Licensure checks,
Licensure checks Site visits, Fingerprinting, site
Licensure checks visits
Provider Enrollment
• Physical Therapists in Private Practice (PTPPs)
placed in moderate risk category.
• PTPPs must have a site visit prior to enrollment
as of March 25, 2011.
• PTPPs may be subject to unannounced site visits
• PTPPs are exempt from the new $505 (raised to
$523 for 2012) enrollment fee.
• If a PTPP also enrolls as a DMEPOS supplier
(e.g. a hand therapist), they must meet the
DMEPOS supplier requirements (pay enrollment
fee of $523; high risk category for new DMEPOS
suppliers)
Provider Enrollment:
Revalidation
• ACA established a requirement for all enrolled providers
and suppliers to revalidate their enrollment information
under new enrollment screening criteria. (applies to
those providers and suppliers that were enrolled prior to
March 25, 2011).
• Between now and March 23, 2015, MACs will send out
notices to begin the revalidation process for each
provider and supplier.
• Providers and suppliers must wait to submit the
revalidation only after being asked by their MAC.
Resources on Provider Enrollment
• February 2, 2011 final rule
• http://edocket.access.gpo.gov/2011/pdf/20
11-1686.pdf
• Transmittal 371 (effective date March 25,
2011)
• https://www.cms.gov/transmittals/downloa
ds/R371PI.pdf
Prepayment Review
• Reviews are conducted by Medicare Administrative
Contractors (MACs), Zone Program Integrity Contractors
(ZPICs).
• Small business Jobs Act of 2010 required predictive
modeling to identify &prevent improper payments
• CMS contracted with Northrop Grummon to deploy
algorithms and an analytical process that looks at CMS
claims in real time—by beneficiary, provider, service origin
or other patterns
• Starting July 1, 2011 will identify problems and assign an
“alert” and risk scores for claims that are aberrent
• Beginning with 10 states identified by CMS as having the
highest risk of fraud, waste, or abuse.
Prepayment Review
• CMS identifies practices that are potentially
fraudulent/abusive through Northrop Grummon
and sends information to Safeguard Contractor.
• Safeguard Contractor sends personnel to visit
the practice and request names, addresses,
birth dates of all employees, business contracts,
licenses of professionals, etc. Requests that
information be provided within 24 hours.
Prepayment Review
• Medicare Administrative Contractors (MACs) are
targeting providers with claims they think may have
improper payments.
• Request medical records via paper letter, which are
then reviewed by clinicians (nurses, physical
therapists, etc)
• For prepayment review, contractors are initially
requesting documentation on approximately 5 claims
to review for medical necessity. If they find a problem,
will request a greater number of medical records.
• If documentation does not support medical necessity,
MAC may place the provider on 100% prepayment
review.
Prepayment Review: MACs
• Will deny payment if review and find it is
not medically necessary
• Provider can appeal to the MAC any
denials.
• Reviews will result in delays in payment.
Postpayment Review
• Reviews are being conducted by Office of
Inspector General, ZPICs, MACs, Recovery
Audit Contractors
• MACs will target certain claims; will review,
and recoup payment if found to be
improperly paid. Provider can appeal.
• Recovery Audit Contractors
– PPACA expanded Medicare’s RAC program to
Medicare Advantage and the prescription drug
benefit program.
Recovery Audit Contractors
(RACs)
• RACs identify Medicare underpayments &
overpayments & recover overpayments.
(Part A & B-so any provider can be subject
to RAC review)
• RACs are paid contingency fees (for
overpayments collected & for
underpayments identified)
• A Database of claims for RACs to review
was created by CMS
• Website: www.cms.hhs.gov/RAC
Recovery Audit Contractors
(RACs)
• Region A – Diversified Collection Services, Inc. of
Livermore, CA ( CT, DE, DC, ME, MD, MA, NH, NJ, NY, PA,
RI and VT)
• Region B – CGI Technologies and Solutions, Inc. of
Fairfax, VA ( IL, IN, KY, MI, MN, OH and WI)
• Region C – Connolly Consulting Associates, Inc. of
Wilton. CT ( AL, AR, CO, FL, GA, LA, MS, NM, NC, OK, SC,
TN, TX, VA, WV, Puerto Rico and U.S. Virgin Islands.)
• Region D – HealthDataInsights, Inc. of Las Vegas, NV (
• AK, AZ, CA, HI, ID, IA, KS, MO, MT, ND, NE, NV, OR, SD, UT, WA,
WY, Guam, American Samoa and Northern Marianas. )
Recovery Audit Contractors
• Can reopen claims up to three years from the date the
claim was paid.
• RACs cannot review claims prior to October 1, 2007
• The RAC Program is required to follow all applicable
Medicare regulations such as payment policies,
reopening timeframes, and appeal rights for providers.
• RACs required to have a medical director on staff, and to use
nurses, therapists, and certified coders.
• Cannot collect contingency fee if claim is being appealed at
any level of appeal.
Recovery Audit Contractors
• RACs choose issues to review based on
data mining techniques, OIG and GAO
reports and experience of staff.
• Two types of review
– Automated (no medical record)
– Complex (medical records)
• New Issues for review will be posted on
RAC’s website.
Recovery Audit Contractors
• RACs will send request for medical
records.
• If provider does not submit requested
record in 45 days, the service will be
denied.
• Records may be submitted via mailed
paper copy, fax, or mailed CD/DVD
• CMS has established medical record
limits.
Recovery Audit Contractors
• Medical Record Request Limits
– Inpatient hospital, IRF, SNF, hospice =10% of avg
monthly Medicare claims (max of 45 days) per NPI
– Other Part A Billers (outpatient hospital, home
health)=1% of avg monthly Medicare services (max
of 200) per 45 days per NPI
– Physicians, Physical therapists in private practice
• Solo practitioner = 10 medical records per 45 days per
NPI
• Partnership of 2-5 individuals: 20 medical records per 45
days per NPI
• Group of 6-15 individuals=30 medical records per 45 days
per NPI
• Large Group (16+ individuals)=50 medical records per 45
days per NPI.
Zone Program Integrity Contractors
• ZPICs combine data from a number of different
sources to create a platform for complex data
analysis.
• ZPICs were started by CMS by combining
Program Safeguard Contractors (PSCs) and
Medicare Prescription Drug Integrity Control
(MEDIC) contracts.
• Use data to look for overpayments, and also to
look for potential fraud.
• ZPIC auditors refer all identified overpayments to
the a MAC, who subsequently sends the provider
a demand letter for recoupment; may conduct site
visits, refer cases to OIG, FBI, etc.
Zone 1 CA, NV, American Samoa, Guam, HI and the Safeguard Services
Mariana Islands
Zone 2 AK, WA, OR, MT, ID, WY, UT, AZ, ND, SD, NE, AdvanceMed
KS, IA, MO
Zone 3 MN, WI, IL, IN, MI, OH and KY
PSC
Zone 4 CO, NM, OK and TX Health Integrity, LLC
Zone 5 AL, AR, GA, LA, MS, NC, SC, TN, VA and WV AdvanceMed
Zone 6 PA, NY, MD, DC, DE and ME, MA, NJ, CT, RI, NH
and VT PSC
Zone 7 FL, PR and VI Safeguard Services
Contractor Review
• ACA included provisions for CMS to evaluate
contractors receiving Medicare Integrity
Program and Medicaid Integrity Program
funding every 3 years.
– ACA requires these contractors to provide
performance statistics to HHS and its OIG upon
request.
• Contractors must competitively bid for the
contract; therefore, they are under pressure to
keep their rates of improper payment low.
Summary of: Reviewers
• Medical Review Units at MACs
– Prepay and postpay, automated and complex)
– Targeted claims selected
– To stop future incorrect payments
• Recovery Audit Contractors
– Postpay, automated and complex
– Detect and correct past improper payments
• CERT
– Postpay only, complex only
– Randomly Selected
Risk Areas for Physical Therapists
In Outpatient Settings
• Missing Certifications on plan of care
• Billing for services furnished by Aides/Techs
• Providing inadequate supervision
• Billing for one-on-one codes instead of group
therapy
• Billing for co-treatment
• Failing to comply with the 8 minute rule
• Failing to comply with CCI edits
• Submitting claims for services that provider
knows are not reasonable and necessary
Risk Areas for Physical Therapists In
Outpatient Settings
• Code Gaming
– Unbundling (hot pack, dressings)
– Upcoding (E-Stim)
• Billing for ‘not medically necessary’ services without an
ABN
• Billing for maintenance care
• Billing for excessive duration and frequency of services
• Billing for services not furnished
• Billing for student services
• Documentation deficits or fraudulent modifications post
denial or request for records
Risk Areas for Physical Therapists in
Outpatient Settings
• Signatures not legible (physician on plan of
care or PT)
• Used a stamped signature
• Plan of care not signed by the physician
• Plan of care not recertified
• Duration/frequency not in compliance with
that identified in Local Coverage Decision
• Documentation is insufficient
• Services not medically necessary
Risk Areas for Physical Therapists
• Frequent use of the KX modifier (aberrent
from the norm)
• In a private practice setting, the billing is
going under one PT provider number
rather than each separate PT enrolling.
• Collecting cash from the patient with no
ABN
Risk Areas for Physical Therapists in
Post-Acute Care Settings
• Home Health:
– Documenting medical necessity
– Incomplete documentation (lack of measurable goals
or rationale for number of therapy visits furnished)
– Supervision and use of PTAs
– Overlap of services between acute and post acute
care
– Establishment and management of maintenance
therapy
– Timely submission of claims and request for
documentation
– Evidence to support patient homebound status
Risk Areas for Physical Therapists
in Post-Acute Care Settings
• Skilled Nursing Facilities:
– Documenting medical necessity and
justification for modes of therapy
– Use of different modes of therapy (individual,
concurrent, and group therapy)
– Adherence to MDS scheduled assessment
periods
– Use of physical therapy aides and students
– Use and documentation of modalities
Risk Areas for Physical Therapists in
Post-Acute Care Settings
• Inpatient Rehabilitation Facilities
– Adherence to three hour rule (intensive therapy
requirements)
– Distinction of skilled versus unskilled therapy
– Use of different modes of therapy (individual,
concurrent, and group therapy)
– Use of physical therapy aides
– Completion of preadmission screening and post
admission evaluation
– Physician involvement
– Interdisciplinary team meetings
Tips on How to Protect Yourself
• Be familiar with Medicare coverage criteria
(keep a copy of applicable Local and
National Coverage Polices)
• Know how access key Medicare reference
documents (Medicare Benefits Policy and
Claims Processing manuals)
• Sign up for Medicare contractor list servs
and email alerts for Open Door Forums and
other educational outreach opportunities
• Conduct periodic self audits
Appeal Rights
• You have an appeal right when your
carrier/intermediary/MAC determines an
overpayment occurred on prepayment or
postpayment review.
• Five levels of appeal—each level has different
requirements
– Redetermination
– Reconsideration
– Administrative Law Judge
– Medicare Appeals Council
– Federal District Court
Questions?
