The Martin Law Firm is a health care law firm located in Pennsylvania that provides regional and national legal representation to health care providers for matters involving Centers for Medicare and Medicaid Services (CMS) and the Medicare program. We defend licensed health care providers, including physicians, chiropractors, nurse practitioners, physician assistants, physical therapists, speech language pathologists, dentists, and DMEPOS suppliers when a Medicare audit results an in overpayment determination, exclusion from the Medicare program or revocation of billing privileges.
MEDICARE PROGRAM INTEGRITY BACKGROUND
Most people view the Health Insurance Portability and Accountability Act (HIPAA) as establishing cumbersome rules in regards to medical privacy; however, in 1996, when HIPAA was signed into law, it also established the Medicare Integrity Program (MIP). The program was designed to reduce the amount of waste, fraud and abuse in the Medicare program. In 2003, the Medicare Modernization Act (MMA) was signed into law and it took things a step further by creating Medicare Administrative Contractors (MACs). MACs were created to perform program integrity functions which primarily include Medicare audits. Today, the MACs focus primarily on whether health care providers who submit claims under the Medicare program are in compliance with Medicare payment rules, laws and guidelines. Examples of non-compliance include:
- Documentation does not support medical necessity
- Encounter notes did not support all elements of eligibility
- Missing or incomplete initial certifications or re-certifications
- Signature of the certifying physician was not included in the record
- Failure to exercise the proper level of supervision
- Failure to properly document the services provided
- Billing for services that were not provided
- Inappropriately prescribing controlled substances to one or more patients
In years past, MACs would randomly select claims for a Medicare audit. After a successful pilot program in 2016, which was then expanded in 2017, the MACs have adopted a new approach called Targeted Probe and Educate (TPE). Under TPE, the MACs will audit claims for items or services that pose the greatest financial risk to the Medicare trust fund and/or those that have a high national error rate.
TARGETED PROBE AND EDUCATE (TPE)
If a health care provider or supplier is the target of a Medicare audit, the MAC will send a Notice of Review to the provider or supplier. The Notice of Review will include the reason for the review and a request for medical records that relate to 20-40 claims (Additional Documentation Request or “ADR”). After the health care provider submits the medical record documentation, the MAC has 30 days from the date the documentation is received to review the documentation and make a payment decision. If the MAC determines that the provider is non-compliant, the provider will receive a letter describing the issues and concerns and the provider will be required to participate in education and training through a one-on-one session with a MAC staff member.
After 45 days, the MAC may perform a second review of 20-40 more claims through the same Notice of Review and ADR process to determine whether the provider has improved the documentation or otherwise taken any corrective action as a result of the first review. This process will continue for up to 3 rounds, if necessary.
After the third round, if the provider or supplier is still non-compliant, further action will be taken against the health care provider that may include prepayment review and suspension of Medicare payments, revocation of billing privileges, extrapolation of overpayment, and referral to a Unified Program Integrity Contractor (UPIC).
UNIFIED PROGRAM INTEGRITY CONTRACTOR (UPIC)
The Unified Program Integrity Contractor (UPIC) is another type of MAC. UPICs are the result of the consolidation of Zone Program Integrity Contractors (ZPICs), Program Safeguard Contractors (PSCs) and Medicaid Integrity Contractors (MICs). Each UPIC is responsible for a region (jurisdiction) of the U.S. Currently, the five UPICS that cover the entire U.S. are:
- Health Integrity, LLC
- AdvanceMed Corporation
- IntegriGuard, LLC dba HMS Federal
- Noridian Healthcare Solutions, LLC
- Safeguard Services, LLC
UPICs conduct prepayment reviews or postpayment reviews. For postpayment reviews, the UPIC will start by “reopening” previously paid claims and then requesting medical records, contracts and other documentation from the provider or supplier that relate to those claims. After the requested documentation is received by the UPIC, the UPIC will review the information with the assistance of physicians or licensed nurses to determine whether the provider or supplier has complied with Medicare reimbursement rules. These rules are found in the following sources:
- The Social Security Act
- U.S. Code of Federal Regulations
- CMS National Coverage Determinations (NCDs)
- CMS Local Coverage Determinations (LCDs)
- CMS Internet Only Manuals (IOMs)
- Accepted and recognized coding sources such as CPT, HCPCS and ICD
The UPIC will then send the health care provider an audit determination that will include the following information:
- Identification of the provider by name and provider number
- An overpayment summary that will describe the claims selected for medical review
- Notable findings including the issues and concerns (e.g. documentation does not support medical necessity)
- Summary of review findings including references relied upon for the determination
- Overpayment calculation
- Referral to CMS for collection
There are two types of overpayments. Identified overpayments are claims that are actually reviewed. Extrapolated overpayments are a sample of claims that are actually reviewed and used to estimate amounts paid in error for a universe of similar claims for a specific period of time. Extrapolation will result in a much larger overpayment determination.
When the matter is referred to CMS for collection, the provider will receive another letter a few weeks later from another MAC whose functions include administrative services for CMS and the Medicare program. These MACs include the following:
- Novitas Solutions, Inc.
- Palmetto GBA
- National Government Services (NGS)
- First Coast Service Options (FCSO)
- Wisconsin Physician Services (WPS)
- Celerian Group Company (CGS)
The collection letter will confirm the overpayment determination, summarize the reasons for the overpayment and request that the amount be repaid. Payment can be made by recoupment, full payment or extended payment schedule approved by CMS.
In addition to the overpayment calculation and demand for payment, CMS can take further action against a provider who submitted improper claims. Actions may include revocation of billing privileges, exclusion from the Medicare program, follow up audits, and referral to the state licensure board.
The collection letter will also explain that the health care provider or supplier has appeal rights.
MEDICARE APPEALS PROCESS
Health care providers and suppliers can appeal a negative TPE audit or UPIC audit determination. If the provider can successfully overturn the denials in the Medicare appeal process, the provider will be able to retain the amounts previously paid for the disputed claims. There are five (5) levels of appeal:
- Redetermination. The health care provider may file a Redetermination appeal to the original CMS contractor within 120 days of the receipt of the initial determination letter. The contractor has 60 days to review the Redetermination appeal and send the provider the results of the Redetermination. The provider may present new evidence during this stage.
- Reconsideration. If the Redetermination appeal is unsuccessful, the provider may request a Reconsideration appeal to a QIC (Qualified Independent Contractor) within 180 calendar days of the receipt date of the unfavorable Redetermination decision. This appeal is an independent review, and it is extremely important to submit all new evidence at this stage of appeal, as this is the last stage that allows providers to submit new evidence. The QIC must issue its decision within 60 calendar days. For denials based on the lack of medical necessity, the QIC’s Reconsideration involves a panel of medical professionals who make a decision based on their clinical experience, the patient’s medical records and any medical, technical and/or scientific evidence contained in the record.
- Administrative Law Judge (ALJ). If the Reconsideration is unsuccessful, the provider may appeal the matter to an Administrative Law Judge. This appeal must be submitted within 60 days from the receipt date of the QIC’s Reconsideration decision. The ALJ will schedule a hearing where the provider can provide oral testimony through video, telephone or an in-person hearing. These proceedings involve the provider, legal counsel, clinical experts and any other participants arranged by the provider.
- Medicare Appeals Council. A review by the Medicare Appeals Council may be initiated in one of three ways: by the provider following the receipt of an unfavorable ALJ decision; by CMS following the ALJ decision; or by the Medicare Appeals Council on its own motion. The Medicare Appeals Council generally does not hold an evidentiary hearing and instead bases its decision on the administrative record of the case, including the recording of the oral testimony before the ALJ.
- Judicial Review in Federal Court. A healthcare provider has 60 days from the receipt of the Medicare Appeals Council decision to file a request for judicial review with the relevant federal district court.
MEDICARE AUDIT AND APPEALS ATTORNEYS – THE MARTIN LAW FIRM, P.C.
We recommend that you immediately contact qualified health care legal counsel at the first sign of a TPE or UPIC audit. There are steps you can take early in the process that can help you avoid a sizeable overpayment finding. Failure to affirmatively respond to a UPIC audit until an overpayment determination has been made may significantly diminish your chances of prevailing in the administrative appeals process. After an overpayment determination, legal counsel with experience in the Medicare appeals process can help you submit an effective appeal and increase your chances of prevailing at each stage of the appeal process by challenging the claim determinations or the extrapolation.
For almost 20 years, The Martin Law Firm, P.C. has represented health care providers who are challenged by Medicare audits and overpayment determinations. If you have questions about a pending case, we would like to help. Contact us today at 215-687-4053.