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Monthly Archives: October 2016
Hospitals still confronting RAC backlogs
Hospitals continue to contest a large proportion of claims denied by recovery audit contractors (RACs) through the multi-level appeals process, and a backlog of claims continue to clog federal administrative law courts.
According to the most recent data from the American Hospital Association’s RACTrac Survey of 676 hospitals nationwide, 45 percent of denials were appealed through the second quarter of 2016, with 56 percent of those appeals related to inpatient coding denials. That’s down slightlyfrom the first quarter, where 47 percent of denied claims were appealed.
The average dollar value of an automated denial–which are caught through computer algorithms–is $741. Complex denials involve far more money, with an average dollar value of $5,418.
Meanwhile, the appeals process remains sluggish. Nationwide, three-quarters of survey respondents said that administrative law courts have taken longer than the mandated 90 days under federal statutes. In the Upper Midwest, 93 percent of hospitals say the process has taken longer than 90 days. Altogether, 27 percent of all appeals ever filed by hospitals since the RAC program began in 2010 continue to be sitting in the appeals process. In 2014, the feds briefly suspended the program after the number of claims being appealed topped 350,000.
Last year, the Centers for Medicare & Medicaid Services (CMS) offered to settle the backlog of appeals involving disputed short-stay hospital stay for 68 cents on the dollar, for a total settlement of about $1.6 billion.
Nevertheless, hospitals have enjoyed considerable success in the appeals process, with 60 percent of appeals leading to a denial being overturned.
Still, the financial burden of appealing a RAC denial is fairly costly. Twenty-percent of hospital said during the second quarter they spent at least $10,000 on administrative costs related to addressing RAC issues; 12 percent spent more than $25,000, 7 percent spent more than $50,000, and 5 percent spent more than $100,000.
IRS taking harder look at non-profit hospitals
The Internal Revenue Service (IRS) is ratcheting up surveillance of non-profit hospitals regarding their levels of community benefits and patient financial assistance.
The IRS reviewed 692 hospitals in fiscal 2016, which ended late last month, Bloomberg BNA has reported. Of those, 166 were referred for a closer “field examination.” The increased scrutiny is specific to 501(r) requirements under the Affordable Care Act, which mandate that hospitals formulate clear written financial assistance policies for patients and make reasonable efforts to determine if patients are eligible for assistance prior to taking any collection actions. The IRS is supposed to review each hospital every three years.
The U.S. Treasury Department issued regulations as to how the rules are to be enforced in 2014. Penalties for non-compliance include being subject to an excise tax or even losing a tax exemption entirely.
“We’ve entered into the enforcement phase now,” Donald B. Stuart, a partner with the law firm Waller Lansden Dortch & Davis LLP told Bloomberg BNA. “We’ve just moved into this new phase and new stage of 501(r), which is going to be a little bit of a wake-up call for a lot of people.”
The hospital sector has pushed back on enforcement, saying that some of the requirements were too burdensome.
Red flags included a hospital’s lack of a community health needs assessment or financial assistance guidelines. Hospitals that are out of compliance risk being audited, which can lead to other issues, such as scrutiny of unrelated business income.
Cartoon – Insuring against your insurance
Cartoon – Enough of my problems
Cartoon – The essence of the firm’s situation
ICD-10 turns 1: Was it so bad?
http://www.healthcaredive.com/news/icd-10-turns-1-was-it-so-bad/427115/
R51: headache. Gearing up for the switch from ICD-9 to ICD-10 last October, many providers expected nothing but headaches. The new system increased the number of diagnostic codes from around 13,000 to about 68,000, requiring clinicians to sift through highly specified conditions — and some unusual ones, such as W61-62XD: struck by duck.
But after a year of using the ICD-10 — and the impending end of a one-year grace period that ensured providers wouldn’t be denied Medicare Part B claims as long as they used a code from the correct family — most physicians say the implementation process went better than expected.
“The fear that this was really going to impact us financially because of the potential inability to process the new codes really never transpired,” says Michael Munger, a family physician with Saint Luke’s Medical Group in Overland Park, KS, and president-elect of the American Academy of Family Physicians.
In fact, the error rate for claims tracked by the AAFP was the same this year as it was for ICD-9 — 10%. The fact that commercial insurers didn’t have the grace period bodes well for the loss of flexibilities, since doctors should be used to being more specified in their claims.
Joint Commission addresses workplace violence in healthcare
- The Joint Commission established an online resource center to prevent workplace violence in healthcare settings.
- The Workplace Violence Prevention Resources page on the Joint Commission website offers access to presentations, newsletter articles, research reports and blog posts detailing strategies for preventing workplace violence.
- The resource center was established as part of a partnership with the Occupational Safety and Health Administration.
The Joint Commission workplace violence resource was established in response to growing rates of violence in healthcare settings. Outside of law enforcement, healthcare is the most violent industry in the nation and healthcare workers face more non-lethal violence than employees in any other industry.
Workplace violence in healthcare settings could be even worse than statistics show. A study published in the New England Journal of Medicine found incidents of violence against providers are under reported. Providers often excuse violent behavior when they are under the influence of drugs and alcohol or who are otherwise in an altered state of mind.
Hospitals in particular face various challenges when it comes to preventing workplace violence. Several physicians working in hospitals told Healthcare Dive in the past about the difficulty of gauging a patient’s capacity for violence during triage and to screen for weapons.
There are seven states with laws requiring employers to run workplace violence prevention programs and 26 states with laws covering assaults on nurses, but no federal laws that specifically address workplace violence in healthcare settings. Establishing an online resource center is a small first step by the Joint Commission.
The case of the disappearing hospital beds
http://www.healthcaredive.com/news/the-case-of-the-disappearing-hospital-beds/427211/
Click to access 2016chartbook.pdf
Healthcare is leaving the traditional four walls of hospitals. As patients, payers, and providers seek to reduce costs and improve quality, they are relying less on inpatient stays and more on outpatient services. A growing reliance on outpatient services could drive healthcare costs down as costly inpatient services are increasingly reserved for patients who truly need them.
Healthcare adds 33,000 jobs in September, though diagnostic labs shed staff
Healthcare businesses added 33,000 jobs in September, the U.S. Department of Labor’s Bureau of Labor Statistics announced on Friday, as the sector continues to be one of the biggest drivers of American jobs.
Overall, the U.S. economy added 156,000 jobs in the month, and the unemployment rate held at 5 percent.
Ambulatory services added 23,900 jobs in the month while hospitals added 6,900 positions. Only medical and diagnostic laboratories lost jobs in the month, shedding 400.
Overall, healthcare has added 445,000 jobs in the past 12 months. September’s gains more than double the 14,000 jobs the sector added in August.
Here’s the seasonally adjusted breakdown for the healthcare sector. All numbers are in thousands:
HENRY KOTULA 