CMA Practice Resources (CPR) is a free monthly e-bulletin from the California Medical Association’s practice management experts that focuses on critical payor and health care industry changes and how they directly impact the business of a physician practice. Each issue includes tips on reimbursement and contracting related issues along with information on the latest practice management news.
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In this issue:
- Physicians have until November 30 to dispute 2015 PQRS and QRUR findings
- MACRA does not create new reporting burdens, is significant improvement over existing law
- Don't forget: Last day to change your Medicare participation status for 2017 is December 31
- CMA publishes FAQ and hosts webinar on controversial new law to end "surprise billing"
- Reminder: Physicians' deadline to verify CHPI data is November 11
- United to issue new 2016-2017 Premium Designation physician results
- AHIP conducting follow-up survey on Provider Directory Pilot
- CMA to host webinar on California workers’ compensation reforms
- 2016 Voter Guide: Why your vote counts when it comes to health care
- Reminder: Blue Shield fee schedule changes effective December 1
- Know Your Rights: Timely filing denials
- The Coding Corner: Undercoding isn’t a solution, it’s a potential compliance liability
The Centers for Medicare and Medicaid Services (CMS) recently released data that indicates which physicians will be subject to the 2017 payment penalties associated with the Physician Quality Reporting System (PQRS) and Value-Based Payment Modifier (VM) programs. Physicians who have concerns about the findings in their report(s) have until November 30 to file for an informal review of their data.
The penalties in question stem from policies in effect prior to the enactment of the Medicare Access and CHIP Reauthorization Act (MACRA). Failure to successfully complete required PQRS reporting in 2015 will result in a 2 percent penalty in 2017. VM penalties can range from 1 to 4 percent, depending on the size of the practice and its performance on cost and quality measures. PQRS penalties will be communicated to physicians by mail as well as in the PQRS feedback reports posted on the CMS website. VM penalties can be found in the Quality and Resource Use Reports (QRUR), which are only posted on the website.
Physicians may access both their 2015 PQRS feedback reports and QRURs on the CMS Enterprise Portal using an Enterprise Identity Management account. For details on how to obtain your QRUR report, see “How to obtain a QRUR” on the CMS.gov webpage. For information on obtaining your PQRS report, see the “Quick Reference Guide for Accessing 2015 PQRS Feedback Reports.” For information on understanding your report, see the “2015 PQRS Feedback Report User Guide.” Both of the PQRS guides are available on the PQRS Analysis and Payment webpage.
Those who have questions, even if they are uncertain about penalty status, are urged to submit a request for informal review. Although in most cases a successful PQRS review will trigger an automatic review of related VM penalties, program officials say the safest course is to file requests for review of both PQRS and VM data.
All informal review requests must be submitted electronically through the Quality Reporting Communication Support Page by November 30, 2016, at 11:59 p.m., ET. Physicians wishing to request an informal review of their QRUR and VM results should contact the Physician Value Help Desk at (888) 734-6433(select option 3) or email@example.com. CMS also has published the “2017 Value Modifier Informal Review Request Quick Reference Guide.”
Practices will be contacted by email with a final decision from CMS within 90 days of the original request for an informal review. All decisions will be final, with no opportunity for further review. Practices that do not receive a response are encouraged to check their junk or spam email folders for the decision.
For additional questions, please contact the QualityNet Help Desk at (866) 288-8912 [TTY: (877) 715-6222] or via firstname.lastname@example.org between the hours of 7 a.m. and 7 p.m., CT, Monday through Friday.
For information regarding other Medicare physician quality programs that apply payment adjustments, please see the Value-Based Payment Modifier website.
For step-by step instructions on how to implement PQRS, view the How to Get Started page. Additionally, the California Medical Association (CMA) updated its resource, “2016 PQRS and Value-Based Modifier Getting Started Guide,” which is available free to CMA members in the resource library at www.cmanet.org.
On October 14, 2016, the Centers for Medicare and Medicaid Services (CMS) issued the final rule to implement the Medicare Access and CHIP Reauthorization Act of 2015, known as MACRA. The final regulation represents a significant improvement over the existing Medicare payment system and quality reporting programs.
The California Medical Association (CMA), the American Medical Association (AMA) and 788 other physician organizations supported the MACRA legislation because it reduces the administrative burdens in the Medicare fee-for-service quality and electronic health record (EHR) reporting programs. The MACRA legislation and the implementing regulations revised the existing reporting programs and will significantly reduce the administrative burdens on physicians. Contrary to popular myth, MACRA does not create new reporting burdens.
- Repeal the Medicare sustainable growth rate (SGR) formula, which threatened payment cuts and stagnated physician payments for over a decade.
- Allow physicians to develop innovative physician-led alternative payment models.
- Provide stable annual updates in the Medicare fee-for-service program.
- Consolidate, streamline and reduce the administrative burdens in the Medicare quality and EHR meaningful use reporting programs.
Penalties lower, bonuses higher
Before MACRA, physicians were facing double-digit SGR payment cuts and 11 to 13 percent or more in payment penalties for not meeting the all-or-nothing requirements in the three Medicare reporting programs (Physician Quality Reporting System, EHR Incentive Program and Value-Based Payment Modifier).
Under MACRA, physicians will be exempt from penalties in 2019 if they report on just one quality measure in 2017. In 2020, the maximum penalty is 5 percent, eventually going up to a maximum of 9 percent in 2022, but physicians would have faced much higher penalties under the pre-MACRA payment rules. Before MACRA, the Medicare bonus payments had all expired. MACRA restores bonus payments of up to 9 percent, plus an additional bonus for exceptional performance.
Click here to see a chart that compares current law payments, bonuses and penalties to MACRA.
Improvements over current law
Though not perfect, the final MACRA rule, which takes effect January 1, 2017, is clear improvement over current law. While CMA is still reviewing the final rule, below are key improvements that CMA and AMA fought to achieve:
- Restores the 0.5 percent payment update for 2017.
- Exempts one-third of all Medicare physicians from MACRA's Merit-Based Incentive Payment System (MIPS) reporting program.
- Eliminates all of the meaningful use and value modifier quality measures.
- Reduces by half the remaining number of measures that physicians must report, from 30 to 15. Small and rural practices must report on even fewer measures.
- Eliminates the EHR Clinical Decision Support and Computerized Physician Order Entry measures.
- Eliminates penalties in 2019 (for the 2017 performance period) for physicians who report for one patient on one quality measure, one improvement activity OR the four EHR measures.
- Only requires physicians to report for 90 days in 2017 to receive a bonus in 2019.
- Only requires physicians to report on 50 percent of their patients in 2017 for the quality category.
- Mostly eliminates the pass/fail system and provides proportional credit for the measures that are met.
- Providers will not be scored on "resource use" (physician cost) in 2017
- Expands the types of alternative payment models (APM) that can participate in MACRA, most notably Track 1 accountable care organizations. The final rule also reduces the financial risk requirements for APMs.
CMA will continue to fight for improvements to the MACRA regulations and the law to reduce the administrative burdens and open up more opportunities for fair payment.
For a summary of the final MACRA rule, visit https://qpp.cms.gov.
Physicians can also visit CMA’s MACRA resource center at www.cmanet.org/macra to access information and resources to help with the transition. The center is a one-stop-shop with tools, checklists and information from CMA, CMS, AMA and national specialty society clinical data registries. CMA will add an updated summary and materials, including additional webinars, to the resource center in the coming weeks.
Once again, it’s time for physicians to decide if they want to make changes to their Medicare participation status. Physicians have until December 31, 2016, to make changes for 2017.
Although Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) penalties will not kick in until 2019, there are two more years of penalties that will be applied based on 2015 performance—tied to the meaningful use, Physician Quality Reporting System and Value-Based Modifier reporting programs. This will also decrease the limiting charge amounts that nonparticipating physicians can bill to patients for unassigned claims.
As always, physicians have three choices regarding Medicare: Be a participating provider; be a non-participating provider; or opt out of Medicare entirely. Details on each of the three participations options are as follows:
- A participating physician must accept Medicare-allowed charges as payment in full for all Medicare patients.
- A non-participating provider can make assignment decisions on a case-by-case basis and bill patients for more than the Medicare allowance for unassigned claims. Non-participating physician fees are 95 percent of participating physician fees. If you choose not to accept assignment, you can charge the patient 9.25 percent more than the amounts allowed in the participating physician fee schedule (which equates to 15 percent of the non-participating fees).
- Physicians who opt out of Medicare are bound only by their private contracts with their patients. Medicare's limiting charges do not apply to these contracts, but Medicare does specify that these contracts contain certain terms. When a physician enters into a private contract with a Medicare beneficiary, both the physician and patient agree not to bill Medicare for services provided under the contract.
Physicians who want to change their participation status for 2017 must send a letter to Noridian, California’s Medicare contractor, postmarked by December 31, 2016.
The California Medical Association (CMA) also has information on physicians' Medicare participation options in CMA On-Call document #7209, "Medicare Participation (and Nonparticipation) Options." On-Call documents are free to members in CMA's online resource library at www.cmanet.org/cma-on-call. Nonmembers can purchase On-Call documents for $2 per page.
Physicians can also visit CMA’s MACRA resource center at www.cmanet.org/macra to better understand the payment reforms and access resources to help with the transition. The center is a one-stop-shop with tools, checklists and information from CMA, the Centers for Medicare and Medicaid Services, the American Medical Association and national specialty society clinical data registries.
Contact: Cheryl Bradley, (213) 226-0338 or email@example.com.
In September 2016, Governor Jerry Brown signed into law a controversial bill (AB 72) that will change the billing practices of non-participating physicians providing non-emergent care at in-network facilities.
While the enactment of AB 72 can never be described as favorable, the end result is a law that puts to rest the issue of so-called “surprise billing” in a way that preserves the ability of physicians to continue collecting their usual rate (as long as they obtain the prior consent of the patient), implements a statutory payment structure that borrows significantly from California Medical Association (CMA) policy and ensures that the statutory payment structure only applies in a narrow set of circumstances.
"Through our good faith participation in the AB 72 stakeholder process, CMA once again represented the true nature of physicians delivering care in a complex system," said CMA Senior Vice President of Government Relations Janus Norman, in his annual legislative wrap up. "We were able to convey that physicians desperately do not want patients to be financially injured by the profit-driven decisions of health insurers to narrow physician networks so that patients are barred from having a substantive opportunity to utilize their in-network benefits."
To help clarify the new law and to address physicians' concerns and questions, CMA has published, "A Physician's Guide to AB 72: Questions and Answers." The FAQ is available to members only in CMA's online resource library.
CMA also recently hosted a webinar to provide an overview of the new law: “Assembly Bill 72: Out-of-Network Billing: How it Works, Who it Impacts and How to Avoid it.” The webinar is now available on-demand in CMA’s online resource library. The webinar is available free to members; the cost is $99 for nonmembers.
Physicians are reminded that the deadline to review and correct their data for the second cycle of the California Healthcare Performance Initiative System (CHPI) is November 11, 2016. In early September, approximately 13,000 physicians in California received their individual quality measurement scores for the second cycle of the CHPI quality rating program. The program rates physicians using claims data from Medicare fee-for-service, Anthem Blue Cross, Blue Shield of California and United Healthcare. This claims data includes both commercial and self-funded health plan data from HMO, PPO, POS and Medicare Advantage products.
The individual quality measurement scores were based on claims data for patient care provided January 1, 2012, through December 31, 2014. Physicians were assigned a star rating of one to four stars, based on where they fall as a percentile within a “peer group,” for each measure as well as a composite score.
To access the CHPI review and correction portal, physicians will have to register using their username and registration token – both listed at the top left of each page of the report. Once registered, you will receive a confirmation email with instructions to create a password.
According to CHPI, it will treat the data as complete and accurate if no corrections are made. This means that even if a physician has not logged into the online portal during the review and correction period, CHPI will still publish the physician's data.
Physicians who review their data and identify errors have until November 11, 2016, to report any discrepancies via the CHPI online portal. At the close of the physician review and correction period, discrepancies will be evaluated and applied, with the results recalculated prior to the public release of the ratings. After November 11, the review and correction period will close, and physicians will be unable to review the data or report discrepancies.
CHPI has advised the California Medical Association (CMA) that in addition to publishing the ratings publicly, it will also release an aggregated data file to the aforementioned participating plans following the review and correction period later this year. CMA inquired as to how the data would be utilized by the plans, but as of the time of publication, it was not known.
For more information on the CHPI Cycle 2 rating methodology, visit the CHPI website at www.chpis.org. CHPI has also published an FAQ on its rating program and a step-by-step review and corrections tutorial.
Physicians who did not receive a letter but would like to confirm whether they are included in CHPI’s rating results can use the CHPI physician lookup at https://provider.medinsight.milliman.com/clients/CHPI/Public/Lookup.
Physicians who identify a high volume of discrepancies in the data used to calculate their scores are encouraged to contact CMA at (916) 551-2061 or firstname.lastname@example.org.
If you have questions or concerns about the CHPI rating results, you may email email@example.com and they will respond within 48 hours.
CMA recently hosted a webinar where CHPI staff provided an overview of the quality rating project, along with step-by-step instructions on how physicians can review their data for accuracy before the quality scores are published. This webinar is available on-demand in CMA's online resource library and is free to CMA members ($99 for nonmembers).
In its October Network Bulletin, United Healthcare (UHC) announced that the next iteration of its Premium Designation assessment results will be sent to physicians in early November. These results will be released publicly via the payor's online physician directory beginning January 4, 2017.
Physicians within 16 specialties (allergy, cardiology, ENT, endocrinology, family medicine, gastroenterology, general surgery, internal medicine, nephrology, neurology, neurosurgery, OB/GYN, pediatrics, pulmonology, rheumatology and urology) and their 47 credentialed sub-specialties will again be ranked by UHC on both national and specialty-specific measures for quality and various cost-efficiency benchmarks. According to UHC, the specialty of ophthalmology, while included in previous Premium Designation assessments, will be excluded from the 2017 assessment due to insufficient data.
According to UHC physicians meeting or exceeding the benchmarks will be identified with a Premium Designation notation on their physician profiles, marketed to UHC enrollees through its online physician directory. UHC also offers employers the ability to select products that offer incentives, such as lower copays or coinsurance, for enrollees who see physicians with a Premium Designation.
The latest assessment is based on claims data from January 1, 2013, through March 31, 2016. Physicians who wish to dispute their assessment results before they are posted publicly in January 2017 must submit a reconsideration request through the United Healthcare Online website no later than December 5, 2016. A Reconsideration How-to Guide is available on the UHC website with instructions on preparing and submitting a reconsideration request. UHC will continue to allow requests for reconsideration until mid-year 2017, but updated distribution of Premium Designations is not guaranteed.
Physicians who encounter problems with their physician assessment reports or who have concerns regarding their Premium Designation can contact United Healthcare at (866) 270-5588. Practices that are unable to obtain answers to their questions or resolve the issue with United Healthcare directly are encouraged to contact CMA at (800) 786-4262.
America's Health Insurance Plans (AHIP) is conducting a follow-up survey of providers to evaluate the process and results of its earlier Provider Directory Pilot program. This program was aimed at meeting the requirements of California Senate Bill 137, which requires that physician directories are more accurate and up-to-date.
AHIP has contracted with independent research organization NORC, at the University of Chicago, to reach out to providers as part of the evaluation phase of the provider directory pilot. Outreach to providers will include an online survey of provider office staff who participated in the AHIP Provider Directory Pilot through the California vendor, BetterDoctor.
The pilot program ran from April to September and included the following eight California plans:
- Anthem Blue Cross
- Blue Shield of California
- Health Net of California
- LA Care
- Molina Healthcare of California
- SCAN Health Plan
- Western Health Advantage
As part of the pilot program, BetterDoctor reached out to California provider offices that were contracted with any of the eight plans to confirm physician and practice demographic information. The pilot was designed to ensure health plan and provider compliance with SB 137 requirements, which took effect July 1, 2016. For more specifics about the provider requirements under SB 137, click here.
The survey will close on November 14, 2016. Providers with questions about the survey can contact NORC at ProviderDirectoryPilot@norc.org.
In 2017, California physicians will again see new reforms instituted as part of several recently enacted laws aimed at increasing the transparency and accountability within the workers’ compensation system. Three recently signed bills (SB 1160, SB 1175 and AB 2503) will bring significant changes to the areas of utilization review, lien filing and bill submission.
SB 1160 will reduce utilization review in the first 30 days following a work-related injury. It also institutes expedited timelines for medication treatment and requests for payment, and adds new lien restrictions to the law that will affect both existing and future liens.
SB 1175 creates a 12-month timely filing limitation period within the workers’ compensation system to submit a medical bill for treatment rendered to an injured worker or for bills submitted for medical-legal expenses.
AB 2503 requires a physician providing treatment to an injured worker to send any request for authorization for medical treatment, with supporting documentation, to the claims administrator.
The California Medical Association (CMA) is hosting a webinar on November 16, 2016, that will present an in-depth overview of these new laws. The webinar will also discuss important implementation dates that will directly impact the processes through which physicians treat injured workers and are paid for their services. The information covered will help to ensure both compliance with the new laws and the ability to take advantage of improvements to the system.
With 17 statewide initiatives, the November 2016 ballot includes the largest number of measures since 2000, when 20 measures qualified. Among these initiatives are a handful that could have a significant impact on patient access to care and the state of health care in California.
Vote with California’s doctors to increase patient access to care and improve health care in the Golden State! Below is a summary of the propositions as they relate to health care, as well as the California Medical Association's official positions on the measures.
Proposition 52: State Fees on Hospitals. Federal Medi-Cal Matching Funds. Initiative Statutory and Constitutional Amendment
CMA Position: Support
Since 2009, California has partnered with hospitals to secure $2 billion per year in federal matching funds for Medi-Cal. This alliance ensures vital access to health care for nearly 7 million California children, providing essential health services such as medical check-ups, immunizations, important prescriptions, dental and vision care. Several years ago, California diverted some of the funds from the hospital fee program to the state's general fund. The initiative will add language to the Constitution to prevent diversion by requiring voter approval of changes to the hospital fee program.
Proposition 53: California Voter Approval Requirement for Revenue Bonds Above $2 Billion Initiative
CMA Position: Oppose
Prop. 53 would "require voter approval for projects larger than $2 billion that are financed through 'revenue bonds,'" a type of bond that is "repaid through tolls or fees paid by users" rather than from the state's general fund. It takes away local control and creates an atmosphere of uncertainty around projects, which could result in higher costs and a loss of investment money in urban projects. Because of this uncertainty, it could impact medical care by curtailing the ability of state and local government to finance projects to build or rebuild major infrastructure. It also fails to contain an exemption for emergencies, in cases of an earthquake or flood, the state and local governments may need to wait as long as two years in order to get voter approval to begin rebuilding.
Proposition 55: California Extension of the Proposition 30 Income Tax Increase Initiative
CMA Position: Support
It extends the temporary personal income tax increases enacted in 2012 on earnings over $250,000 by 12 years, with revenues allocated to K-12 schools, California Community Colleges, and health care. The measure would increase state revenues—$4 billion to $9 billion annually from 2019-2030. It would also provide almost $2 billion in funds to improve access to health care for low-income children and their families.
Proposition 56: California Healthcare, Research and Prevention Tobacco Tax Act of 2016
CMA Position: Support
CMA is a proponent of this initiative that is supported by a broad alliance of physicians, health care advocates, educators and others – would raise California’s tobacco tax, which is currently among the lowest in the country, to $2.87 a pack. The majority of the money from the initiative’s user fee on cigarettes and other tobacco products, including e-cigarettes containing nicotine, will be used for existing health programs and research into cures for cancer and other illnesses caused by smoking and tobacco products.
Proposition 58: California Non-English Languages Allowed in Public Education Act
CMA Position: Support
The measure would repeal most of the 1998 Proposition 227, the "English in Public Schools" Initiative, thus effectively allowing non-English languages to be used in public educational instruction and bring back bilingual education. Research shows that bilingual education, when it is well-designed and implemented, can be at least as good, and often better at helping immigrant and other non-English speaking students gain academic proficiency. Forty percent of the California population is Latino, but only four percent of them are physicians. CMA supports this measure in the hopes bilingual education would encourage young people with language skills and cultural competency to chose health care as a vocation and improve care to Californians.
Proposition 61: Drug Price Standards Initiative
CMA Position: Oppose
The initiative would require state health programs to pay no more for prescription drugs than the discounted rate that the Veterans Association pays. The measure is a deceptive proposition that will increase drug prices, reduce access to medicines, while increasing red tape and taxpayer costs. The Legislative Analyst’s Office found that Medi-Cal fee-for-service, with 3 million people could be hit with higher, not lower, costs. Similarly, CalPERS, which provides retirement and health care benefits to California state government workers, raised red flags, citing, “decreased access to certain drugs for CalPERS members” and “increased administrative costs” under Prop. 61.
Proposition 63: “Safety for All”
CMA Position: Support
Prop. 63 would prohibit the possession of large-capacity ammunition magazines and require most individuals to pass a background check, as well as obtain authorization from the California Department of Justice to purchase ammunition. CMA’s Board of Trustees, which is composed of physicians elected by their peers, endorsed the measure during its July meeting. In 1994, CMA declared the high volume of guns in California a major public health problem, and the decision to endorse Prop. 63 builds on CMA’s long history of protecting public health and promoting healthy California communities.
Proposition 64: California Marijuana Legalization Initiative
CMA Position: Support
Proposition 64 would allow adults aged 21 years old or older to possess and use cannabis for recreational purposes. The measure would create two new taxes, one levied on cultivation and the other on retail price. Revenue from the taxes would be spent on drug research, treatment, and enforcement, health and safety grants addressing cannabis, youth programs, and preventing environmental damage resulting from illegal marijuana production. CMA has adopted official policy recommending legalization and regulation of cannabis. The decision was based on a CMA white paper that concludes physicians should have access to better research, which is not possible under current drug policy.
For more information on these initiatives, see www.cmanet.org/2016-ballot-measures.
Physicians are reminded that changes to the Blue Shield physician fee schedule will take effect December 1, 2016, as indicated in their September 27 letter to providers.
The new rates are now available on the Blue Shield website (under "Helpful Resources," click “Professional Fee Schedule” then click “Search the Claims Fee Schedule”). To view the new fees, change the default date of service on the “Search Fee Schedule” page to December 1, 2016, (effective date of the change) or later.
Physicians can also request a copy of the new fees for up to 20 codes by completing the allowance review form enclosed with the notice, or by calling the Blue Shield Provider Information and Enrollment Department at (800) 258-3091. Blue Shield will provide a response to your inquiry within 10 business days.
As always, physicians are encouraged to carefully review all proposed amendments to health plan or medical group/IPA contracts. The California Medical Association (CMA) reminds physicians that they do not have to accept substandard contracts that are not beneficial to their practice.
To help physicians understand their rights when a health plan has sent notice of a material change to a contract, CMA has published "Contract Amendments: An Action Guide for Physicians," available in CMA's online resource library. The guide includes a discussion of options available to physicians when presented with a material contract change, as well as a financial impact worksheet that will help physicians calculate the net impact of fee schedule changes on their practice.
CMA’s “Know Your Rights” series summarizes vital protections under state and federal law that physicians should be aware of in their dealings with payors.
Health plans typically impose claim filing deadlines, which require physicians to submit claims within a certain time period after the date of service. If the physician fails to meet the deadline, the health plan will not pay for the service provided. However, California law prohibits commercial health plans and insurers from imposing claim filing deadlines that are less than 90 days after the date of service for contracted physicians or 180 days for non-contracted physicians. If the payor is not the primary payor under coordination of benefits (COB), the payor cannot impose a deadline for submitting a COB claim that is less than 90 days from the date of payment or date of denial from the primary payor.
Even if the physician fails to submit a claim on time, California law provides a “good cause” exception that requires payors to accept and adjudicate a claim if the physician demonstrates, upon appeal, “good cause” for the delay.
Below are steps you can take to prevent timely filing denials:
- Submit claims as quickly as possible after services are rendered.
- Where possible, file claims electronically. Retain payor acknowledgement of receipt of claim as proof of timely filing. California law requires health plans to acknowledge receipt of an electronic claim within two days and a paper claim within 15 days of receipt.
Note: An acknowledgement of transmission of a claim from a clearinghouse is not an acknowledgement that the claim has been received by the payor. Check with your clearinghouse to determine its process for tracking health plan receipt of claims.
- Appeal in writing all claims that have been incorrectly denied for timely filing. Include a copy of the payor's acknowledgment of receipt of the claim with your appeal.
- Review health plan contracts to ensure that deadlines for filing claims are no less than 90 days.
- Report health plan violations of the timely filing laws to the appropriate regulator and to the California Medical Association (CMA) at (800) 786-4262.
For a summary of California's unfair payment practices law, see "Know Your Rights: Identify and Report Unfair Payment Practices." More information on timeframes for claim submission can be found in “Know Your Rights: Timely Filing Limitations” or in CMA On-Call document #7511, “Payment Denials by Managed Care Plans and IPAs,” available free to members at www.cmanet.org/ces.
CPR’s “Coding Corner” focuses on coding, compliance and documentation issues relating specifically to physician billing. This month’s tip comes from Michael D. Miscoe, President-Elect of the AAPC National Advisory Board, and G. John Verhovshek, the managing editor for AAPC, a training and credentialing association for the business side of health care.
Undercoding—failing to report the full extent of the procedures or services provided—is sometimes used as a defensive strategy to thwart audits or fraud accusations. The thinking is, “If I under-report the services provided, I can’t be accused of trying to receive payments in bad faith.” But undercoding is a poor strategy, as Novitas, the Medicare contractor for Delaware, Maryland, New Jersey, Pennsylvania and Washington, D.C., recently outlined.
- Undercoding hurts provider reimbursement:
…undercoding impacts your practice revenue. You are not being appropriately paid for the level of service you provide to your patients. Correcting undercoded claims can mean costly appeals.
- Undercoding increases improperly paid claims:
When there is an underpayment due to undercoding, we did not pay the claim correctly and it is counted as an improper payment error…. Undercoding errors can statistically impact calculated error rates in the tens of millions of dollars [emphasis in the original].
- Undercoding misrepresents the care provided (which may hurt patients), and skews the data payors use to calculate payments, going forward:
Undercoding misrepresents the true level care that is provided to Medicare beneficiaries. These statistics are used to calculate future Medicare payments and track trends in health care delivery.
- Undercoding increases your risk of audit:
Patterns of undercoding may be viewed as aberrant and open your practice up to audits and reviews.
For all of these reasons, “It’s important to code the level service that is supported by your documentation….”
How undercoding creates false claims liability
Undercoding, like overcoding (reporting more work than was performed or medically necessary), can create compliance liability. Undercoding can take two forms: Failing to report services performed at the encounter, and underreporting the level of service provided. Both are problematic.
Under the False Claims Act, a physician may be held liable for “submit[ting] claims to Medicare for medical services he or she knows were not provided.” Undercoding by omission is the inverse of this. Rather than billing for work that he didn’t do, the provider doesn’t bill for all of the work performed, in an attempt to gain reimbursement to which he isn’t entitled. False claims liability potentially arises where a complete and accurate representation of the service would have resulted in a different payment, or would have negatively influenced the carrier’s determination to pay.
For instance, a provider sees a patient and performs three services: A, B and C. Assume that the applicable bundling rule establishes that service C is a component of service B, and that service B is a component of service A. Assume no exclusionary modifier are appropriate. If all three services were reported, only Service A would be paid. Knowing this, the provider doesn’t bill Service B, but does report services A and C. Not knowing that Service B was provided, the payor allows payment for both services. Had the payor been apprised of all the facts, it would have paid less money.
This type of misrepresentation can create false claims liability. At a minimum, misrepresentation by omission fits within the Centers for Medicare and Medicaid Services definition of abuse, “misusing codes on a claim.” Where a payor can substantiate that the omission represented a “deliberate ignorance or reckless disregard of the truth related to the claim,” both the materiality and intent elements necessary to prove fraudulent conduct would be satisfied.
The Criminal Health Care Fraud Statute also makes it a crime “to obtain (by means of false or fraudulent pretenses, representations, or promises) any of the money or property owned by, or under the custody or control of, any health care benefit program.” Undercoding by omitting information that might influence the payment determination may be perceived as “false or fraudulent representations” of the services provided.
When reporting a lower-level service than actually was performed, providers must consider the anti-kickback statute: to the extent that the undercoding diminishes the patient’s obligation for payment, such a reduction is considered “remuneration.”
For example, an established patient presents for an evaluation and management service. The work and associated documentation demonstrate that the physician performed a level 4 service. Concerned about the cost to the patient, the provider instead reports a level 2 service. The value of the “discount” is remuneration to the patient. To the extent that it can be shown that one purpose of the remuneration was to induce or influence the patient’s selection of the provider, or the decision to receive the health care service, the anti-kickback statute would be implicated.
All providers should strive to report the entirety of the work performed (notwithstanding bundling rules), the necessity for that work and (where relevant) the correct level of service. Doing so is what Novitas calls “right coding.” Right coding should always result in the right payment. Where providers receive the right payment, there is no compliance risk. As Novitas rightly concludes, “When you practice right coding, coding the level of service supported by your documentation, we all win – you, your patients and the Medicare program.”
UNITED HEALTHCARE: Effective for claims with a date of service on or after January 1, 2017, United Healthcare (UHC) will require the NDC number, quantity and unit of measure on drug-related claims submitted for reimbursement for Commercial and Medicare Advantage members. This requirement applies to both paper (CMS-1500) claim forms and Electronic Data Interface transactions (837P). Claims submitted without the required NDC number will result in denial of the service; practices will need to resubmit the claim with the necessary NDC information. Practices requiring additional clarification should review the FAQ available on the UHC website.
WORKERS’ COMPENSATION: The Division of Workers’ Compensation (DWC) has recently launched a free online educational program for physicians who treat patients in the California workers’ compensation system. The first course offered, “Caring for California’s Injured Workers: Using California’s Medical Treatment Utilization Schedule (MTUS),” is aimed at educating physicians on the application of the MTUS, including its role in utilization review and the independent medical review processes. The module is available on the DWC website. Physicians who take the course are eligible to receive one hour of free continuing medical education credit.
The California Medical Association offers our members free programs to educate physicians and staff on a range of practice management issues. Space is limited, so register soon.
Upcoming CMA webinars
Most webinars are held over the lunch hour, from 12:15 to 1:15 p.m. and are free for CMA members and their staff. See the event calendar for additional details and to register.
11/9: Nondiscrimination Statements: A Detailed Guide to Compliance: The U.S. Department of Health and Human Services Office of Civil Rights recently finalized new nondiscrimination rules intended to advance health equity and reduce health care disparities. Physicians need to be in compliance with the rule, which includes new requirements with respect to nondiscrimination postings and grievance procedures. This webinar will cover who this rule applies to, give an in-depth overview of the requirements and how physicians can comply, and explain what happens when a covered provider does not comply with the new rule.
11/16: 2017 Workers’ Compensation Reforms: Learn About Upcoming Changes to Utilization Review, Requests for Authorization, and Billing and Lien Filing Processes: Governor Jerry Brown recently signed a number of bills into law that reform California’s workers’ compensation system. This webinar will provide an overview of these changes and important implementation dates that will directly impact the processes during which physicians treat injured workers and are paid for their services. The information covered will help to ensure both compliance with the new laws and the ability to take advantage of improvements to the system. (Members only)
Contact: CMA’s member help center, (800) 786-4262 or firstname.lastname@example.org.
The California Medical Association’s Center for Economic Services provides direct reimbursement assistance to CMA physician members and their office staff.
Reimbursement Help Line (888/401-5911)
- One-on-one educational and reimbursement assistance to physician members and their staff
- Tools and resources to empower physician practices
- Seminars and toolkits for physicians and their staff
- Staffed by practice management experts with a combined experience of over 125 years in medical practice operations
Need help? Contact CMA’s reimbursement experts at (888) 401-5911 or email@example.com.
To make sure that you are aware of important news from your contracting health plans, we encourage you to regularly read plans' provider newsletters and bulletins. Follow the links below to access the current issues.
AETNA: www.aetna.com. Click on "Health Care Professionals" in the main menu, then on "News for Providers" in the left sidebar.
CIGNA: www.cigna.com. Click on "Health Professionals" under "Customer Care" in the main menu. Then, scroll down and click on "Newsletters."
ANTHEM BLUE CROSS: www.anthem.com/ca. Click on "Providers" in the main menu, then on "Professional Network Update" under "Spotlight."
BLUE SHIELD: www.blueshieldca.com. Click on "I'm a Provider," then on "Announcements" under "News and Features."
HEALTH NET: www.healthnet.com. Click on "I'm a Provider" and then "California." Enter username and password, and then click "Online News."
MEDI-CAL: www.medi-cal.ca.gov. Click on "Publications" in the main menu, then on "Provider Bulletins."
MEDICARE/NORIDIAN: https://med.noridianmedicare.com/web/jeb/fees-news. Noridian publishes individual articles through the Latest Updates section in the left sidebar. The articles are condensed approximately every six-to-eight weeks into a Bulletin.
UNITED HEALTHCARE: www.unitedhealthcareonline.com. Click on "Tools & Resources" in the main menu, then on "Network Bulletin."
CMA RESOURCE: Find up-to-date profiles on each of the major payors in California.
If you have questions related to any of the articles in this issue, please contact CMA's reimbursement help line, (888) 401-5911 or firstname.lastname@example.org. Questions about membership, including technical website issues, should be directed to CMA's member help center, (800) 786-4CMA or email@example.com.
Let us know which topics you would like to see addressed in future issues. Contact CMA's Center for Economic Services at (916) 551-2061 or firstname.lastname@example.org.