Revenue Cycle

Survival in a new era of enforcement a tall order for hospitals

Recovery Auditor Report, December 10, 2009

The struggling economy has left many hospitals with thin wallets, and government auditors are gunning for what’s left.
 
There are big dollars at stake. The Government Accountability Office released a report [date] that estimated the following overpayment amounts in 2008:
  • Medicaid, $18 billion. Medicaid hasn’t been policed as strictly as Medicare has, and as a result overpayments and sometimes even fraud have flourished, according to Michael Taylor, MD, senior medical director of government and regulatory affairs at Executive Health Resources, who spoke at the HCPro “Medicare Compliance Forum” held in Atlanta. “But those days are over, and CMS will be examining it as closely as the other programs,” he notes.
  • Medicare fee for service, more than $10.4 billion. 
  • Medicare Advantage, $6.8 billion. The estimated Medicare Advantage overpayments have led some members of Congress to propose extending the RAC program to the Medicare Advantage program. “Imagine what that would look like,” says Taylor. “Once the Medicare Advantage payers start to see the RAC program expanded, they’ll then start to learn from the RACs. And they start to use the same techniques themselves.”
“We’ve all heard the saying, ‘A billion here a billion there, soon it adds up to real money.’ That’s what we’re seeing here,” Taylor explains. 
 
Hence the arrival of the many auditors—from RACs to ZPICs—looking for Medicare and Medicaid overpayments or fraud. They’re looking for billions.
 
Thus we enter a new era of smart, aggressive enforcement.
 
Unfortunately, dealing with the enforcement is a tall order for hospitals caught in a tough economic environment, with decreasing reimbursement and increasing regulatory demands. But manage, they must. Because the bottom line is really patient care, Taylor said.
 
“Hospitals that fail to deal with this, that fail to … ensure compliance and ensure revenue integrity, that fail to appeal when appropriate and prevail when they should—those hospitals are going to suffer. And as a result patient access to care will suffer,” Taylor says. “It’s not just about the payment. It’s about the care you can provide.”
 
Editor’s note: For more information, listen to sessions from the “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status, and the Role of Physician Advisors,” available via HCMarketplace.com. Recordings from the Observation and Physician Advisor tracks are also available.

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