Health Information Management

CMS announces official start date for Recovery Auditor prepayment reviews

JustCoding News: Inpatient, August 15, 2012

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CMS officially announced the Recovery Auditor prepayment review demonstration in November 2011, but then in January 2012 decided to delay the program by three months. Since then—despite rumors that the program could be coming soon—the official start date has been unknown to the public. This changed however, when CMS announced Friday, August 3, that Recovery Auditor prepayment reviews will begin August 27.

In this demonstration, Recovery Auditors will conduct prepayment reviews on certain types of claims that historically result in high rates of improper payments. The following seven states, which have high populations of fraud- and error-prone providers, will be subject to the demonstration
  • Florida
  • California
  • Michigan
  • Texas
  • New York
  • Louisiana
  • Illinois
In addition, four states with high claims volumes of short inpatient stays will also be subject to the program:
  • Pennsylvania
  • Ohio
  • North Carolina
  • Missouri
Target areas and focus
CMS also released further details about the program’s focus areas during a special open door forum call December 21, 2011. After CMS identified short hospitals stays as a problem area in its comprehensive error rate testing (CERT) report, the agency decided it would target certain issues in its prepayment review demonstration. Specifically, it will focus on:
  • Incorrectly coded claims
  • Patients who came through the ED but should have subsequently gone to observation rather than be admitted
  • Patients who received elective surgery during short-day stays when they should have been classified as outpatient procedures
Diving further into possible target areas, CMS extracted a number of short stay MS-DRGs from data in the CERT report that present billing problems for providers. These MS-DRGs represent the first group of MS-DRGs that will be held for prepayment reviews. CMS previously announced the follow schedule for 2012 reviews:
  • January 1: MS-DRG 312, syncope and collapse
  • March 1: MS-DRG 069, transient ischemia and MS-DRG 377, gastrointestinal (GI) hemorrhage with MCC
  • May 1: MS-DRG 378, GI hemorrhage with CC and MS-DRG 379, hemorrhage without a CC or MCC
  • July 1: MS-DRG 637, diabetes with MCC, MS-DRG 638, diabetes with CC, and MS-DRG 639, diabetes without a CC or MCC
Click here to read more on the Revenue Cycle Institute website.

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