Daniel Ciolek Advocacy Dept. Mark Parkinson Update on Part B Therapy MMR Status Thursday, March 20, :57:44 PM

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1 From: To: Cc: Subject: Date: Daniel Ciolek Advocacy Dept. Mark Parkinson Update on Part B Therapy MMR Status Thursday, March 20, :57:44 PM Finance, Legal, LTCC, Therapy Policy Advisory Group FROM: Dan Ciolek, Dianne De La Mare As a follow-up to the prior messages below I wanted to share with you the current status of Part B therapy manual medical review (MMR). This morning I had a good conversation with Brian Elza, who is the Acting Director of the Division of Recovery Audit Operations at CMS, and he was able to share some details regarding how CMS is considering to comply with the therapy MMR statutory requirement for claims since the Recovery Auditor Contractor (RAC) review pause began in late February, and what CMS is considering doing if Congress requires therapy MMR after the current mandate expires on March 31, Below is a summary of the issues we discussed and his responses. My apologies in advance for the level of detail, but there are a lot of moving parts to this complex issue and much is unknown awaiting necessary Congressional action and other CMS RAC contracting hurdles that need to be addressed: Claims Processing and MMR ADR Generation Activities: Claims with dates of service surpassing $3,700 threshold in post-pay states by February 21, and pre-pay states by February 28 should have already received MMR ADRs and providers are required to respond to them by submitting requested documentation to the RAC as usual. Claims with dates of service surpassing the $3,700 threshold after the above listed dates and up to March 31 remain subject to the current statutory MMR requirement, but due to the RAC pause, these claims will be paid as long as there are no problems identified by standard edits and other non-mmr related policies. This includes claims in the previously designated pre- and post-pay states. CMS currently intends to conduct post-pay MMR on these claims later using the RACs once the new RAC contracts are awarded. During the pause, Medicare Administrative Contractors (MACs) and other contractors may continue to conduct routine audits within the scope of their review contracts. There is no current statutory authority for CMS to conduct therapy MMR with claim dates of service beginning April 1. However, if Congress elects to extend the therapy MMR requirement beyond March 31, then CMS is leaning towards eliminating the 11 state pre-pay review requirement and only conduct post-pay MMR in all states. This is not a final decision, however the rationale provided is that ongoing systems communication issues between the Medicare Administrative Contractors (MACs) and the RACs create challenges with contractor compliance with the 10-day review requirement. This has the most impact in pre-pay MMR states where such problems delay prompt payment. However, if therapy MMR moves to 100% post-pay, then CMS is considering extending the review window to 30 days which is the standard for other review contractor requirements, since post-pay review does not have an impact on prompt payment like pre-pay review does.

2 Also, if Congress extends the therapy MMR provisions beyond April 1, then CMS is considering conducting post-pay review on all such claims using the new RAC contractors when awarded. We had some discussion regarding concerns about the administrative burden on providers if RACs were to try to reduce the review backlog caused by the pause all at once. This is particularly important for SNF providers that are subject to the largest proportion of therapy MMR reviews. At this point CMS is considering options to ramp up such operations but the process is yet to be defined. Status of RAC Contractor Procurement: As Dianne mentioned in the second prior below, the current pause in RAC reviews is to permit the current RACs to complete their activities under their current contracts by June 1, 2014 and any future reviews will be conducted by companies awarded the new RAC contracts. CMS had hoped to award new RAC contracts by June 1. However, the bids for all four RAC contract regions that would be responsible for therapy MMR and other Part A and B activities (excluding durable medical equipment, home health, and hospice) are under current preaward protest and CMS is awaiting a GAO decision as to the validity of the protests. Any decision to uphold any of these protests would further delay the date of the new RAC contract award date(s). Even if the GAO strikes down the pre-award protests and CMS is able to issue RAC contract awards, losing bidders would have the right to submit a post-award protest. Again, if this occurs, it could further delay RAC contractor award dates. There were no protests for the national DME/Home Health/Hospice RAC contract so that one most likely will be awarded relatively quickly compared to the protested contracts. It is entirely possible that CMS may award some regional RAC contracts to the contractors currently responsible for the particular regions, while other RAC regional contracts may be awarded to new contractors. If this occurs, the current RAC contractors that were reawarded a particular region may be able to start up operations (e.g. resume therapy MMR) sooner than the new RAC contractors since the new contractors will need to establish joint operating agreements, establish secure connectivity to transfer data, and complete a number of other important start-up activities. For the above reasons, CMS is unable to provide an estimate of when therapy MMR audits will resume at this time. CMS Provider Education: CMS is unlikely to be able to post any formal website updates related to how they will handle therapy MMR until at least a few weeks after Congress acts, or doesn t act on therapy cap policy, since the current statutory authority to conduct therapy MMR expires March 31 and further instructions will depend on any new statutory language. I also requested that as soon as the therapy MMR policy becomes clear and CMS decides where to post the guidance, that CMS publish a MLN Matters Special Edition article that includes an explanation and all the applicable CMS web links so that providers would have a single entry point for accessing the pertinent information. Take Home Message (my interpretation): Although it is encouraging that CMS has currently paused therapy MMR review to allow

3 providers to have time to focus efforts on the appeals backlog, and that CMS has listened to provider concerns, and now appears to be leaning towards eliminating pre-pay review if Congress extends the MMR requirement, nothing is written in stone yet regarding future CMS therapy MMR activities. It appears at this time that CMS has every intent to retroactively review all beneficiary claims containing services over the $3,700 threshold that were paid during the pause on a post-pay basis once the new RAC contracts are awarded. SNF operators should consider how to manage and store the documentation associated with therapy MMR eligible claims that are being paid during the current RAC review pause so that it will not be such a burden to locate and prepare to submit therapy MMR additional development request (ADR) responses once the pause ends and reviews resume. As noted above, much of this this is a description of where it appears CMS intends to go with therapy MMR if it is required to do so by Congress, and is based upon an assumption that Congress would not provide any new directives that differ from current statute. AHCA staff and members continue in our efforts with Congress to pass legislation that would ease the burden imposed by the current therapy MMR requirement. We also continue working to educate CMS regarding our therapy MMR concerns so that future policy decisions are reasonable. Please let me know if you have any additional questions. Thanks. Daniel E. Ciolek, PT, MS, PMP Senior Director, Therapy Advocacy American Health Care Association 1201 L St. NW, Washington, DC Mobile (302) dciolek@ahca.org From: Daniel Ciolek Sent: Friday, February 21, :20 PM To: Advocacy Dept. Cc: Mark Parkinson Subject: Part B Therpay MMR to be 'Paused' Finance, Legal, LTCC, Therapy Policy Advisory Group FROM: Dan Ciolek, Dianne De La Mare, Elise Smith As Dianne mentioned below, and AHCA announced in a press release yesterday, the CMS announcement earlier this week to pause Recovery Auditor Contractor (RAC) pre- and postpayment reviews until new RAC contracts were issued with improved processes, and RAC accountability standards, is a very welcome development that will hopefully provide significant relief to the current problems of improper early claim denials, and the resultant severe appeals process backlog. However, due to the vague CMS announcement, and the fact that the Part B therapy pre-

4 and post-pay Manual Medical Review (MMR) process is a separate activity performed by RACs, and not part of the formal RAC program, providers have been receiving conflicting information from their Medicare administrative contractors (MACs) and RACs. AHCA has contacted CMS, and received the following written clarification this morning: February 21, 2014 is the last day for Recovery Auditors to send ADR letters (complex reviews and semi-automated reviews). This date also applies to post-payment reviews of Outpatient Therapy claims over the $3700 Threshold. February 28, 2014 is the last day for MACs to send ADR letters for the Recovery Auditor Prepayment Demonstration (complex reviews). This date also applies to prepayment reviews of Outpatient Therapy claims over the $3700 Threshold. If a provider has already received an ADR letter, or will receive one of the last ones (sent by the end of this month), the provider must comply with the request and submit the records, or a denial will be made on the involved claim(s). Any records that were previously submitted to the Recovery Auditor will continue to be reviewed, and the provider will receive a review results letter, as usual. This is an extremely positive development for SNF providers that receive the brunt of MMR ADRs due to the needs of the patient population we serve. This pause will permit providers to focus more on furnishing care for their current patients, while working to clear the backlog of current MMR ADRs and related appeals. Please note that this pause does not preclude providers from responding as required to any ADRs they receive, or have already received. CMS has not yet reported an end-date for this pause. CMS also indicated that they intend to provide more detailed clarification next week. AHCA is developing and compiling questions to present to CMS next Monday to better assure that their clarification addresses any questions we have regarding process or implications. We will also be updating members to new developments through the various AHCA member outreach vehicles including the new AHCA therapy services MMR page at: If you have any questions you would like included in our list for CMS, please send them to dciolek@ahca.org as soon as possible. Daniel E. Ciolek, PT, MS, PMP Senior Director, Therapy Advocacy American Health Care Association 1201 L St. NW, Washington, DC Mobile (302) dciolek@ahca.org From: Dianne De La Mare Sent: Thursday, February 20, :47 AM

5 To: Advocacy Dept. Cc: Mark Parkinson Subject: CMS Announces "Pause" in RAC Audits Finance, Legal, LTCC FROM: Dianne De La Mare, Dan Ciolek, Elise Smith Welcome news from CMS after hearing last week at the Administrative Law Judge (ALJ) Forum (what we already knew) that a significant increase in the number of audits in the Recovery Audit (RA) program over the last several years is a major factor for the 2+ year backup at the ALJ level. On Tuesday, 2/18/14, CMS announced on its website that it is pausing RA audits in preparation for the procurement of new RA contracts and to allow CMS to continue to refine and improve the Medicare RA Program. To obtain a complete copy of the announcement go to Compliance-Programs/Recovery-Audit-Program/Recent_Updates.html. Specifically, CMS states in the announcement that it is in the procurement process for the next round of RA Program contracts. According to CMS, it is important that the agency transition down the current contracts so that the RAs can complete all outstanding claim reviews and other processes by the end date of the current contracts. In addition, a pause in operations will allow CMS to continue to refine and improve the RA Program. Several years ago, CMS states that it made substantial changes to improve the RA program, and it will continue to review and refine the process as necessary. Providers should note the important dates below: February 21 is the last day an RA may send a postpayment Additional Documentation Request (ADR) February 28 is the last day a MAC may send prepayment ADRs for the RA Prepayment Review Demonstration June 1 is the last day a RA may send improper payment files to the MACs for adjustment Any questions from providers should be directed to RAC@cms.hhs.gov. -- This was Anti Virus checked by Astaro Security Gateway. Disclaimer Version RS.US