Corporate Compliance

Caring for patients with acute renal failure

Compliance Monitor, September 2, 2005

Q: How should we handle Medicare patients diagnosed with acute renal failure who no longer require inpatient care but, still require ongoing dialysis treatments? The physician does not feel that the diagnosis can be changed to chronic renal failure or end-stage renal disease because the patient may regain renal function.

Local dialysis providers are not licensed to provide services for acute renal failure diagnosis. Our hospital is not licensed to provide outpatient dialysis. We could admit the patient as an inpatient just for the dialysis and contract with the dialysis clinic to provide the dialysis as an inpatient in our facility. However, the patient would not meet inpatient criteria.

The patient will require hemodialysis three times a week for an undetermined length of time. How should this situation be handled from a billing as well as compliance standpoint?

A: This is a series of questions and from the reference it is not clear whether this question relates to a commercial payer or Medicare. The scenario would be different depending on the payer.

That being said, there is a considerable difference in reimbursement for a hospital versus a dialysis facility for dialysis treatment. Usually it is in the best interest of the hospital to try to refer the patient out to a dialysis facility.

If you have a nephrologist who consulted the patient while he or she was an inpatient, then most of time that physician is affiliated with a dialysis center where he or she already sees patients. The norm is that the physician will follow the patient and a referral be made to that doctor and facility.

The hospital social worker or an administrative person responsible for duties such as finding additional outpatient services for a patient will need to contact the dialysis facility closer to the patient's home (or the one at which the consulting doctor makes rounds) to try to do what's called a letter of agreement (LOA) or memo of understanding (MOU). In these documents, the hospital agrees to pay the dialysis center to take the patient until the patient either receives a diagnosis for renal failure and becomes eligible for ESRD Medicare or until the physician determines that the patient should just be followed by a nephrologist in an office practice.

An LOA or MOU is usually predetermined by a set period of time. A nephrologist should be able to advise the administrative person at the hospital of how long it may take to determine whether the patient would need permanent dialysis. This is usually somewhere between 60 and 90 days.

Please be advised that most of the time the doctor and facility are separate entities and the hospital would need to contact both to negotiate the deal. However, if the insurance is a commercial payer, it might be better to follow the facilities and doctors they have in their network and to seek advice from a case worker at the commercial payer.

With regard to billing, the agreement is between the hospital, doctors, and facility. The bills would go to the hospital. However, keeping a well-documented medical record will support any diagnosis.

With regard to compliance, it is my understanding that HIPAA requires all physician practices and large hospitals to have compliance manuals in place. The hospital should have some type of policy to guide them through this process.

Also, under HIPAA, a compliance officer is required. Normally the compliance officer is a physician. Forward these same questions to that person in your establishment for advice on how to proceed with this issue under the compliance plan.

This question was answered by La Shunda Johnson, a managed care coordinator in Dallas.

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