Revenue Cycle

Recovery audits result in changes to CMS systems and recoupment options

Recovery Auditor Report, February 9, 2012

This week CMS published two transmittals that affect CMS systems as a result of the recovery audit programs.  One directs contractors to develop edits to avoid common overpayment situations the recovery auditors have found.  The other allows providers a more streamlined option for recouping overpayments without incurring interest.

In transmittal R1031OTN, CMS directed its contractors to develop edits around the following overpayment issues identified through recovery audits or other sources:

  • Incorrect “office” place of service for services rendered in the facility setting
  • Evaluation and management (E/M) services billed during the global period
  • Incorrect discharge status codes triggering full payment rather than transfer payment (Note: CMS appears to list some discharge status codes that should not trigger transfer payment, including 01-Home, 04-Custodial or Supportive Care, 50-Hospice Home, and 51-Hospice Facility)
  • Outpatient services billed by a provider other than the skilled nursing facility (SNF) for a patient in a covered part A stay at a SNF
  • Source of admission code other than “D” when patients are transferred from an acute care hospital to that hospitals distinct part inpatient psychiatric unit
  • Untimed codes billed with units greater than one without an appropriate modifier (i.e. modifier 59) (Note: See transmittal for a list of codes CMS considers untimed codes)

Contractors involved with developing the edits include claims processing contractors as well as the Fiscal Intermediary Shared System contractor, the Multi-Carrier System contractor and the Common Working File contractor.  CMS is scheduling up to eight calls between July 15, 2012 and September 6, 2012 with the various contractors to discuss implementing the edits.

Continue reading on the MedicareMentor blog.

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