Physician Services Are the Initial Primary Target under Michigan’s New Medicare RAC Regime

Kevin R. Miserez, Esq.
Wachler & Associates, P.C.

The Centers for Medicare & Medicaid Services (CMS) announced back in October 2016 that it had awarded the next round of contracts to various entities to serve as Recovery Audit Contractors (RACs) for the Medicare program. In total, five separate RAC contractors were awarded, each connected with one of the five designated “RAC Regions.” RAC Regions 1-4 encompass all Part A and Part B provider types, except for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) providers and home health/hospice providers which were consolidated on a nationwide basis under the RAC Region 5 contact. Similar to the previous RACs, the current RACs are contracted to perform post-payment audit reviews in an effort to identify improper Medicare payments (e.g., overpayments) made to providers within the designated RAC Region.

The RAC contract for Region 1, which includes Michigan, was awarded to Performant Recovery, Inc. (Performant). In March 2017, Performant announced on its website that it received approval from CMS to commence audit activity. The specific audit issues to be targeted by Performant, per CMS’s approval, are posted on Performant’s website for providers to access and review. At this time, the majority of the approved audit issues applicable to Michigan target physician/non-physician practitioner services. Examples of these recently approved issues and their descriptions include:

Issue Name:Annual Wellness Visits (AWV)
Issue Description:HCPCS code G0438 (Annual wellness visit; includes a personalized prevention plan of service [pps], initial visit) is a “one time” allowed Medicare benefit per beneficiary]

Issue Name:Global Surgery – Pre- and Post-operative Visits
Issue Description:Identification of overpayments associated to minor and major surgical services. 1) E/M services (as specifically defined in the IOM) billed the day prior to, day of, or during the 90-day global period of a major (90-day) surgical service without modifiers as specifically defined in the IOM; 2) E/M services (as specifically defined in the IOM) billed the day of or during the 10-day global period of a minor (10-day) surgical service without modifiers as specifically defined in the IOM; and 3) E/M services (as specifically defined in the IOM) billed the day of a minor (0-day) surgical service without modifiers as specifically defined in the IOM.

Issue Name:Hospital Discharge Day Management Service
Issue Description: Only one hospital discharge day management service is payable per patient per hospital stay. Only the attending physician of record reports the discharge day management service.

Issue Name:Office Visits Billed for Hospital Inpatients
Issue Description: If evaluation and management service are being rendered to patients admitted to an inpatient hospital setting, then CPT Codes 99221-99223, 99231-99233 and 99238-99239 are to be used. CPT codes 99201-99215 are to be used for evaluation and management service provided in the physician’s office, in an outpatient or other ambulatory facility

Issue Name:Drugs & Biologicals – Units exceed the only FDA approved dose
Issue Description:Clinical profile of drugs and biologicals that support only one possible dose given.

Issue Name: Panretinal (Scatter) Laser Photocoagulation – Excess Frequency
Issue Description:Potential incorrect billing occurred when Panretinal (Scatter) Laser Photocoagulation (CPT code 67228) is paid more than once, per eye, within the global surgery period (90 days for DOS prior to 1/1/2016 and 10 days for DOS 1/1/2016 and after).

For all approved issues, the dates of service potentially subject to post-payment review by Performant include those claims which have a “claim paid date” within three years or less from the date of Performant’s “Initial Finding” letter (issued to providers following Performant’s audit review). Providers can access the complete list of the currently targeted audit issues under the “Approved Issues” section on Performant’s website. In fact, it is strongly recommended that providers review these approved issues on a regular basis in order to stay abreast of potential audit risk areas.

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