Knowledge Base Category -

Fiscal Year 2022 Supplemental Improper Payment Data

On December 8, 2022, the Comprehensive Error Rate Testing (CERT) published the 2022 Medicare Fee-for-Service Supplemental Improper Payment Data (https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/CERT/CERT-Reports).

This report supplements the FY 2022 HHS Agency Final Report for Fiscal Year 2022, highlights common causes of improper payments, and includes tables allowing you to drill down into the review findings.

 

Estimated Improper Payment Rates

Calculation for the FY 2022 Medicare FFS improper payment rate included claims submitted during the 12-month period from July 1, 2020 through June 30, 2021. As compared to FY 2020 and 2021, the improper payment rate is trending up:

 

Improper Payment Rate

• FY 2020: 6.27%
• FY 2021: 6.26%
• FY 2022: 7.46%

  Improper Payment Amount

• FY 2020: $25.74 billion
• FY 2021: $25.03 billion
• FY 2022: $31.46 billion.

   

  “It is important to note that the improper payment rate is not a “fraud rate,” but is a measurement of payments that did not meet Medicare requirements. Improper payments are attributed to one of five major error categories (no documentation, insufficient documentation, medical necessity, incorrect coding, or other).

  Similar to prior years, in FY 2022 “insufficient documentation” was the main cause of improper payments. The CERT defines “insufficient documentation” as when the medical record documentation submitted is inadequate to support payment for the services billed. In other words, the CERT contractor reviewers could not conclude that the billed services were actually provided, were provided at the level billed, and/or were medically necessary. Claims are also placed into this category when a specific documentation element that is required as a condition of payment is missing, such as a physician signature on an order, or a form that is required to be completed in its entirety.

  While the CERT data reports on improper payments in several settings (i.e., skilled nursing facilities, hospital outpatient, hospice), this article focuses on Part A (Hospital IPPS) findings.

   

   

  “0 or 1 day” Length of Stay Claims

  A compare of improper payments rates for Part A hospital claims by length of stay (LOS) has been a part of this report since the October 1, 2013 implementation of the Two-Midnight Rule:

   

• 2014: “0 or 1 Day” stay claims highest improper payment rate to date at 37.18%,
• 2021: “0 or 1 Day” stay claims lowest improper payment rate to date at 16.8%.
• 2022: The “0 or 1 Day” claims rate increased to 20.1% with projected improper payments of $1.5 billion.

 

In addition, to the CERT’s focus on claims by length of stay, short stays (“0 of 1 Day” Stays) are also actively being reviewed by the OIG as part of their Work Plan (https://oig.hhs.gov/reports-and-publications/workplan/summary/wp-summary-0000538.asp) and Livanta, the National Medicare Claim Review Contractor (https://livantaqio.com/en/ClaimReview/index.html), who is actively requesting short stay claims across the nation on a monthly bases.  

 

Top 20 Service Types with Highest Improper Payments: Part A Hospital IPPS

Table D4 of this report includes the top 20 DRG types with the highest improper payment rate. The table also details the percentage of error by each of the CERT’s major error categories.

 

Overall, 44.4% of the errors in the top 20 service types were due to error category medical necessity. A claim is placed in this category when the CERT contractor reviewer receives adequate documentation from the medical records submitted to make an informed decision that the services billed were not medically necessary based upon Medicare coverage and payment policies. One hundred percent of the errors for the following two DRG Types was attributed to medical necessity:

 

• DRG Group 252, 253, and 254: Other Vascular Procedures, and
• DRG Pair 551 and 552: Medical Back Problems.

   

  Top Root Causes of Improper Payments

  The 2022 report includes tables highlighting the top root cause of improper payments for the top three service types with the highest projected improper payments in the Part A (Hospital IPPS) setting.

   

   

  Moving Forward

  Moving forward, here are ideas and resources to help in your efforts to prevent claims errors:

• Visit the CERT Provider Website (https://c3hub.certrc.cms.gov/) to find information about the CERT, how to submit records, sample request letters and much more,
• Become familiar with National and Local Coverage Determinations and Local Coverage Articles that detail indications and limitations of specific services. For example, CMS has published an MLN Booklet titled Major Joint Replacement (Hip or Knee) (https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/jointreplacement-ICN909065.pdf) to provide guidance on what to document to avoid denied claims, and
• Take the time to review the CERT’s Supplemental Improper Payment Data report annually.

1. Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity (DRGs 469, 470) Top Root Cause: “Inpatient admission not medically necessary and the invasive procedure should have been billed as an outpatient procedure.”
2. Endovascular Cardiac Valve Replacement and Supplement Procedures (DRGs 266, 267) Top Root Cause: “Documentation to support medical necessity for the procedure – missing.”
3. Percutaneous Intracardiac Procedures (DRGs 273, 274) Top Root Cause: NCD requirement(s), other documentation required for payment – Missing.”

Compliance Education Updates

MLN Fact Sheet: Rural Emergency Hospitals

In October 2022, CMS published a Rural Emergency Hospitals (REHs) MLN Fact Sheet (link). Starting January 1, 2023, Medicare will pay for Medicare-enrolled REHs to deliver emergency hospital, observation, and other services to Medicare patients on an outpatient basis.

COVID-19 Updates

January 11, 2023: Public Health Emergency Declaration Renewed

As expected, on January 11, 2023, the Public Health Emergency (PHE) renewed for the twelfth time. PHE declarations last for the duration of the emergency of 90 days and may be extended by the Secretary. Ninety days from January 11th will be April 11, 2023. Specific to the COVID-19 PHE, HHS has indicated that they will provide a 60-day notice prior to termination of the COVID-19 PHE (March 12, 2023). It is unclear if the PHE will last beyond April 2023.

Other Updates

New ICD-10 Diagnosis and Procedure Codes Effective April 1, 2023

As a reminder, there are 34 new procedure codes and 42 new diagnosis codes that will be effective April 1, 2023. In their announcement listing the new diagnosis codes they note that “In an effort to better enable the collection of health-related social needs (HRSNs), defined as individual-level, adverse social conditions that negatively impact a person’s health or healthcare, are significant risk factors associated with worse health outcomes as well as increased healthcare utilization, the Centers for Disease Control and Prevention’s (CDC) National Center for Health Statistics (NCHS) is implementing 42 new diagnosis codes into the International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM), for reporting effective April 1, 2023.”

Medicare Transmittals & MLN Articles

Travel Allowance Fees for Specimen Collections: 2023 Updates

• MLN Release Date: January 9, 2023
• What You Need to Know: Make sure your billing staff knows about the specimen collection fees and travel allowances for 2023.
• MLN MM13071: (link)

Revised Transmittals & MLN Articles

National Coverage Determination 110.24: Chimeric Antigen Receptor T-cell Therapy

• MLN Release Date: December 1, 2022 – Revised January 5, 2023
• What You Need to Know: This article was revised to clarify that providers should not bill more than 1 unit per HCPCS code.
• MLN MM12928: (link)

Home Health Prospective Payment System: CY 2023 Update

• MLN Release Date: November 10, 2022 – Revised January 5, 2023
• What You Need to Know: This article was revised to show that the rural add-on is extended through CY 2023 as part of the Consolidated Appropriations Act of 2023.
• MLN MM12957: (link)

Coverage Updates

Percutaneous Transluminal Angioplasty (PTA) of the Carotid Artery Concurrent with Stenting

In June 2022, the Multispecialty Carotid Alliance (MSCA) submitted a formal request for reconsideration of the National Coverage Determination (NCD) 20.7: PTA that provides coverage for carotid artery stenting (CAS). In their letter they indicated evidence supports the following changes to the NCD:

1. Expand patient selection criteria to reflect the established data from research:
1. Revise the patient selection criteria for PTA and CAS with embolic protection to cover the following:
1. Patients who have asymptomatic carotid artery stenosis ≥ 70%, and
2. Patients who have symptomatic carotid artery stenosis ≥ 50%.
2. Eliminate the requirement that patients be at high risk for CEA:
2. Eliminate the minimum standards for facility requirements; and
3. Leave coverage for any CAS procedures not described by the NCD to the discretion of the local Medicare Administrative Contractors (MACs).

On January 12, 2023, CMS accepted the formal request, initiated a National Coverage Analysis (link) and are accepting public comments from January 12, 2023 through February 11, 2023. The expected due date for a proposed decision memo is July 12, 2023.

Did You Know?

January is Thyroid Awareness Month.

 

Why Should You Care?

The American Thyroid Association (ATA) has published prevalence and impact information on thyroid disease (https://www.thyroid.org/media-main/press-room/), for example:

• More than 12 percent of the United States population will develop a thyroid condition during their lifetime,
• An estimated twenty million Americans have a form of thyroid disease,
• Up to 60 percent of those with thyroid disease are unaware of their condition,
• Women are five to eight times more likely than men to have thyroid problems, and
• Undiagnosed thyroid disease may put a patient at risk from certain serious conditions, such as cardiovascular diseases, osteoporosis, and infertility.

 

What Can You Do?

Take steps to understand what the thyroid gland does, what thyroid hormone impacts and what can happen when your thyroid gland is not functioning properly. According to the CDC (https://www.cdc.gov/nceh/radiation/hanford/htdsweb/guide/thyroid.htm)

• The thyroid gland, located in the front of the neck just below the Adam’s apple, takes iodine from your diet and makes thyroid hormone. Thyroid hormone affects your physical energy, temperature, weight, and mood.
• In general, there are two broad groups of thyroid disorders: abnormal function and abnormal growth (nodules) in the gland.
• Thyroid disorders are common, especially in older people and women. Most thyroid problems can be detected and treated.
• Abnormal function is usually related to the gland producing too little thyroid hormone (hypothyroidism) or too much thyroid hormone (hyperthyroidism).
• Benign nodules in the thyroid are common, usually do not cause serious health problems, can occasionally put pressure on the neck and cause trouble with swallowing, breathing, or speaking if too large.
• Thyroid cancers are much less common than benign nodules and with treatment, the cure rate for thyroid cancer is more than 90 percent. You can learn more about Thyroid Cancer and the annual Medicare Treatment costs of Thyroid Cancer in a related RealTime Medicare Data (RTMD) infographic in this week’s newsletter.

 

Have your doctor check for thyroid disease during a standard physical exam by palpation of the thyroid gland. There are two standard blood tests that your doctor may recommend. One measures your thyroid hormone level (T4) and another measures thyrotropin (TSH) which is a hormone secreted from the pituitary gland that controls how much thyroid hormone your thyroid makes.

 

Treatment for thyroid disease will be specific to the type and severity of the thyroid disorder and the age and overall health of the patient.

Did You Know?

On January 11, 2023 CMS updated their 2023 ICD-10-CM and PCS webpages to provide information about the new codes that will be effective April 1, 2023. You can read more about the codes in a related MMP article ( https://www.mmplusinc.com/kb-articles/new-icd-10-cm-and-icd-10-pcs-codes-effective-april-1-2023).

 

Why Should I Care?

In addition to new diagnosis codes, the FY 2023 ICD-10-CM Official Guidelines for Coding and Reporting has been updated to include new guidance regarding Social Determinants of Health (SDOH).

 

Specifically, new guidance clarifying when to assign a code for living alone, food insecurity and homelessness, has been added to guidelines for SDOHs in Chapter 21 of the Chapter-Specific Guidelines, Section b.17.  Following is a compare of the June 2022 guidance to the January 11, 2023 guidance.

 

Excerpt from June 2022 Official Guidelines for Coding and Reporting (https://ftp.cdc.gov/pub/Health_Statistics/NCHS/Publications/ICD10CM/2023/ICD-10-CM-Guidelines-FY2023.pdf)

 

Codes describing problems or risk factors related to social determinants of health (SDOH) should be assigned when this information is documented. Assign as many SDOH codes as are necessary to describe all of the problems or risk factors. These codes should be assigned only when the documentation specifies that the patient has an associated problem or risk factor. For example, not every individual living alone would be assigned code Z60.2, Problems related to living alone.

For social determinants of health, such as information found in categories Z55-Z65, Persons with potential health hazards related to socioeconomic and psychosocial circumstances, code assignment may be based on medical record documentation from clinicians involved in the care of the patient who are not the patient’s provider since this information represents social information, rather than medical diagnoses. For example, coding professionals may utilize documentation of social information from social workers, community health workers, case managers, or nurses, if their documentation is included in the official medical record.

 

Patient self-reported documentation may be used to assign codes for social determinants of health, as long as the patient self-reported information is signed-off by and incorporated into the medical record by either a clinician or provider.

 

Excerpt from January 2023 Official Guidelines for Coding and Reporting

(https://www.cms.gov/files/document/fy-2023-icd-10-cm-coding-guidelines-updated-01/11/2023.pdf)

 

Social determinants of health (SDOH) codes describing social problems, conditions, or risk factors that influence a patient’s health should be assigned when this information is documented in the patient’s medical record. Assign as many SDOH codes as are necessary to describe all of the social problems, conditions, or risk factors documented during the current episode of care. For example, a patient who lives alone may suffer an acute injury temporarily impacting their ability to perform routine activities of daily living.

When documented as such, this would support assignment of code Z60.2, Problems related to living alone. However, merely living alone, without documentation of a risk or unmet need for assistance at home, would not support assignment of code Z60.2. Documentation by a clinician (or patient-reported information that is signed off by a clinician) that the patient expressed concerns with access and availability of food would support assignment of code Z59.41, Food insecurity. Similarly, medical record documentation indicating the patient is homeless would support assignment of a code from subcategory Z59.0-, Homelessness.

For social determinants of health, such as information found in categories Z55-Z65, Persons with potential health hazards related to socioeconomic and psychosocial circumstances, code assignment may be based on medical record documentation from clinicians involved in the care of the patient who are not the patient’s provider since this information represents social information, rather than medical diagnoses. For example, coding professionals may utilize documentation of social information from social workers, community health workers, case managers, or nurses, if their documentation is included in the official medical record.

Patient self-reported documentation may be used to assign codes for social determinants of health, as long as the patient self-reported information is signed-off by and incorporated into the medical record by either a clinician or provider.

The files containing information on the ICD-10-CM updates effective with discharges on and after April 1, 2023 are available on the CMS ICD-10-CM webpage (https://www.cms.gov/medicare/icd-10/2023-icd-10-cm) and the CDC’s Comprehensive Listing ICD-10-CM Files webpage (https://www.cdc.gov/nchs/icd/Comprehensive-Listing-of-ICD-10-CM-Files.htm).

 

What Can I Do?

Share this information with key stakeholders at your facility (i.e., Coding Professionals, Clinical Documentation Improvement Specialists, and Case Management).

Did You Know?

January is Cervical Health Awareness Month.

Why Should You Care?

According to a CDC Fact Sheet (link), while all women are at risk for cervical cancer, it occurs most often in women over age 30. Almost all cervical cancers are cause by the Human Papillomavirus (HPV), additional factors that can increase a woman’s risk for cervical cancer includes:

• Smoking,
• Having HIV or another condition that makes it hard for your body to fight off health problems,
• Using birth control pills for five or more years, and
• Having given birth to three or more children.

What Can You Do?

The good news is that with regular screening tests and follow-up with your doctor, cervical cancer is the easiest of gynecological cancers to prevent.

Medicare covers:

• Cervical cancer screening with HPV Tests in asymptomatic Medicare Part B female patients aged 30-65 years once every five years,
• Pap tests screening for female patients with Medicare Part B annually for women with a high risk for developing cervical or vaginal cancer and every two years for low-risk women, and,
• Screening pelvic exams also annually for high-risk women and every two years for low-risk women.

The patient pays nothing for any of these screening tests if the physician accepts assignment.

You can learn more about these tests including applicable National Coverage Determinations, HCPCS and CPT codes by accessing the MLN Educational Tool Medicare Preventive Services (MLN006559 December 2022) at: https://www.cms.gov/Medicare/Prevention/PrevntionGenInfo/medicare-preventive-services/MPS-QuickReferenceChart-1.html#CERV_CAN).

Did You Know?

CMS established the New COVID-19 Treatments Add-On Payment (NCTAP) under the Medicare Inpatient Prospective Payment System (IPPS). This add-on payment was “designed to mitigate potential financial disincentives for hospitals to provide new COVID-19 treatments, and is effective from November 2, 2020, until the end of the fiscal year in which the COVID-19 public health emergency (PHE) ends.”

Why Should You Care?

Providers will receive “an enhanced payment for eligible inpatient cases that use certain new products with current FDA approval or emergency use authorization (EUA) to treat COVID-19.”

NCTAP claims are eligible for the “enhanced payment,” when the claim has the ICD-10-CM diagnosis code U07.1 (COVID-19) and one of the treatments listed on the CMS NCTAP webpage (link).

A new treatment was added to the list in November 2022 after the FDA issued an EUA for Kineret injection for hospital discharges on or after November 8, 2022. Your hospital would report this treatment by adding the applicable NDC code 06665823407 to the claim.

CMS advised that “hospitals should report the ICD-10-PCS code(s) or NDC(s) for all products administered during the stay, even if the hospital got the product for free. Hospitals shouldn’t report charges for products they got for free.”

What Can You Do?

Become familiar with the list of approved treatments and the related ICD-10-PCS code or NDC that must be on the claim and share this information with your coding staff.

Medicare Transmittals & MLN Articles

Inpatient & Long-Term Care Hospital Prospective Payment System: FY 2023 Changes

• MLN Release Date: December 1, 2022
• What You Need to Know: This article highlights FY 2023 updates. For example, providers are reminded that CMS is not adjusting payments for any hospital in the Hospital Value Based Purchasing program or the Hospital Acquired Condition Reduction Program for FY 2023.
• MLN MM12814: (link)

DMEPOS Fee Schedule: CY 2023 Update

• MLN Release Date: December 2, 2022
• What You Need to Know: This article provides information for your billing staff about the annual update to fee schedule amounts for new and existing codes and payment policy changes.
• MLN MM13006: (link)

Clinical Laboratory Fee Schedule: CY 2023 Annual Update

• MLN Release Date: December 9, 2022
• What You Need to Know: This article provides information for your billing staff about instructions for the CY 2023 Clinical Laboratory Fee Schedule (CLFS), mapping for new codes, and updates for laboratory costs subject to the reasonable charge payment.
• MLN MM13023: (link)

HCPCS Codes & Clinical Laboratory Improvement Amendments (CLIA) Edits: April 2023

• MLN Release Date: December 9, 2022
• What You Need to Know: This article provides information for your billing staff about new HCPCS and discontinued HCPCS codes and required CLIA certificates.
• MLN MM13024: (link)

Laboratory Edit Software Changes: April 2023

• MLN Release Date: December 12, 2022
• What You Need to Know: NCDs with April 2023 updates includes 190.18 – Serum Iron Studies, 190.22 – Thyroid Testing, 190.23A – Lipids Testing, and 190.23B – Lipids Testing.
• MLN MM13026: (link)

Hospital Outpatient Prospective Payment System: January 2023 Update

• MLN Release Date: December 14, 2022
• What You Need to Know: CMS advises providers to make sure their billing staff knows about payment system updates and new codes for COVID-19, drugs, biologicals, radiopharmaceuticals, devices and other items and services.
• MLN MM13031: (link)

New Medicare Part B Immunosuppressant Drug Benefit

• MLN Release Date: December 16, 2022
• What You Need to Know: Your billing staff needs to know about the extension of Medicare coverage for immunosuppressant drugs beyond 36 months for certain patients with kidney transplants and coverage of premiums and cost sharing for these patients. This is a new benefit that was included in the Consolidated Appropriations Act (CAA) and is effective January 1, 2023.
• MLN MM12804: (link)

Ambulatory Surgical Center Payment System: January 2023 Update

• MLN Release Date: December 22, 2022
• What You Need to Know: CMS advises providers to make sure your billing staff knows about new HCPCS C-codes on the ASC Covered Procedure List (CPL), new HCPCS codes for drugs and biologics, and the skin substitute product assignments to high and low-cost groups.
• MLN MM13041: (link)

Revised Transmittals & MLN Articles

Extension of Changes to the Low-Volume Hospital Payment Adjustment and the Medicare Dependent Hospital Program

• MLN Release Date: October 21, 2022 – Revised December 9, 2022
• What You Need to Know: This article was revised due to a revised Change Request (CR) 12970. CMS will give your MAC 60 days to reprocess claims affected by the CR.
• MLN MM12970: (link)

Coverage Updates

National Coverage Determination 110.24: Chimeric Antigen Receptor T-cell Therapy

• MLN Release Date: December 1, 2022
• What You Need to Know: CMS advises providers to make sure your billing staff know about the following changes to CAR-T billing:
• Include additional place of services (POS) codes for office and independent clinics,
• Bill in 0.1-unit fractions, and
• Use 3 modifiers, including the new modifier -LU.
• MLN MM12928: (link)

National Coverage Determination 200.3: Monoclonal Antibodies Directed Against Amyloid for the Treatment of Alzheimer’s Disease

• MLN Release Date: December 8, 2022
• What You Need to Know: This article provides information about FDA-approved monoclonal antibodies and CMS-approved studies that your billing staff needs to know.
• MLN MM12950: (link)

Compliance Education Updates

Biosimilars & Interchangeable Products: Free Continuing Education Courses from FDA

CMS reminded providers in the December 8, 2022 edition of MLN Connects (link) that the FDA has free accredited continuing education courses for health care providers on biosimilars and interchangeable products.

Other Updates

December 2, 2022: Letter to U.S. Governors from HHS Secretary Xavier Becerra on COVID-19, Flu, and RSV Resources

HHS Secretary Xavier Becerra noted in a letter to U.S. Governors (link) that “I write today to reinforce that the Biden-Harris Administration stands ready to continue assisting you with resources, supplies, and personnel, as it has throughout our fight against COVID-19.”

December 6, 2022: CMS Proposed Rule to Expand Access to Health Information and Improve the Prior Authorization Process

CMS provided the following information in the December 8, 2022 MLN Connects Newsletter (link):

As part of the Biden-Harris Administration’s ongoing commitment to increasing health data exchange and investing in interoperability, CMS issued a proposed rule that would improve patient and provider access to health information and streamline processes related to prior authorization for medical items and services. CMS proposes to modernize the health care system by requiring certain payers to implement an electronic prior authorization process, shorten the time frames for certain payers to respond to prior authorization requests, and establish policies to make the prior authorization process more efficient and transparent. The rule also proposes to require certain payers to implement standards that would enable data exchange from one payer to another payer when a patient changes payers or has concurrent coverage, which is expected to help ensure that complete patient records would be available throughout patient transitions between payers.

Medicare National Correct Coding Initiative: Annual Policy Manual Update for 2023

On December 1st, CMS posted the updated Medicare National Correct Coding Initiative Policy Manual effective January 1, 2023. Additions and revisions to the manual are noted in red font.

National Correct Coding Initiative: January Update

You can find the National Correct Coding Initiative (NCCI) fourth quarter edit files, effective January 1, 2023, on these Medicare NCCI webpages:

• Procedure-to-Procedure Edits
• Medically Unlikely Edits
• Add-on Code Edits

December 14, 2022: Guidelines for Achieving a Compliant Query Practice (2022 Update)

In December, the final version of the 2022 update to the Guidelines for Achieving a Compliant Query Practice was released. This document is a joint effort of the Association of Clinical Documentation Integrity Specialists (ACDIS) and the American Health Information Management Association (AHIMA). This document supersedes all previous versions of this document. As noted in this practice brief, it “should be used to guide organizational policy and process development for a compliant query practice.” You can read more about this document in a related AHIMA press release (link).

December 15, 2022: OIG’s Top Unimplemented Recommendations 2022 Report

The OIG announced the publication of their 2022 Top Unimplemented Recommendations: Solutions to Reduce Fraud, Waste, and Abuse in the HHS Programs report (link). Specific to Medicare Parts A and B and in keeping with the 2020 and 2021 reports, unimplemented recommendation for inpatient rehabilitation facilities (IRFs) and a call for CMS to seek legislative authority to comprehensively reform the hospital wage index system remains on the list. The third unimplemented recommendation was also in the 2021 report and calls for CMS to recover overpayment of $1 billion resulting from incorrectly assigning severe malnutrition diagnosis codes to inpatient hospital claims.

December 21, 2022 Joint Commission Announces Major Standard Reductions and Freezes Hospital Accreditation Fees

On Wednesday, December 21st, the Joint Commission announced (link) the elimination of 168 standards (14%), the revision of 14 other standards and that they would not be “raising its accreditation fees for domestic hospitals in 2023 in recognition of the many financially challenges hospitals and health systems continue to face.”

December 23, 2022: First Generic Drug Approvals

The FDA has published a list of First-Time Generic Drug Approvals in 2022 (link). They note that first generics “are just what they sound like – the first approval by FDA which permits a manufacturer to market a generic drug product in the United States.”

PAMA Regulations Update

On December 30, 2022, CMS updated their PAMA (Protecting Access to Medicare Act of 2014) CMS webpage (link) with the following information:

DELAY!!! IMPORTANT UPDATE: The next data reporting period is January 1, 2024 through March 31, 2024, will be based on the original data collection period of January 1, 2019 through June 30, 2019.

On December 29, 2022, Section 4114 of Consolidated Appropriations Act, 2023 revised the next data reporting period for CDLTs that are not ADLTs and the phase-in of payment reductions under the Medicare private payor rate-based CLFS. The next data reporting period of January 1, 2024 through March 31, 2024 will be based on the original data collection period of January 1, 2019 through June 30, 2019. After the next data reporting period, there is a three-year data reporting cycle for CDLTs that are not ADLTs (that is 2027, 2030, etc.).

MMP’s Protection Assessment Report (P.A.R.) combines current Medicare Fee-for-Service review targets (i.e., MAC, RAC, OIG) with hospital specific paid claims data made possible through a collaboration with RealTime Medicare Data (RTMD). Monthly, our newsletter spotlights current review activities. This month we focus on the Shared Decision-Making (SDM) requirement for Left Atrial Appendage Closure (LAAC) and Implantable Cardioverter Defibrillator procedures.

Did You Know?

The Agency for Healthcare Research and Quality (AHRQ) (link) defines Shared Decision-Making (SDM) as “a model of patient-centered care that enables and encourages people to play a role in the medical decisions that affect their health,” and goes on to note that “the innovation of shared decision making is the use of evidence-based tools, known as patient decision aids, to inform patients and help them set their own goals and clarify their values.”

Why It Matters?

There are two National Coverage Determinations (NCDs) for a cardiac procedure in which an SDM encounter is listed as one of the nationally covered indications for coverage of the procedure.

• NCD 20.34: Left Atrial Appendage Closure (LAAC)
• NCD 20.4 Implantable Automatic Defibrillators

This matters because the Comprehensive Error Rate Testing (CERT) Contractor lists both procedures in Table D4 of the 2021 Comprehensive Error Rate Testing (CERT) supplemental improper payment data report. This table details the top 20 service types with the highest improper payments in the Part A hospital inpatient prospective payment system (IPPS) setting.

DRG pair 273 and 274 (Percutaneous Intracardiac Procedures) had the third highest projected improper payment at $160,504,177 and a 29.3% improper payment rate. LAAC procedures group to this DRG pair. Insufficient documentation accounted for 83% of the improper payment rate and 17% of the improper payment rate was attributed to medical necessity issues.

DRG pair 226 and 227 (Cardiac Defibrillator Implant without Cardiac Catheterization) had the fifth highest projected improper payment rate at $">link),790,870 and a 22.7% improper payment rate. Insufficient documentation accounted for 85.3% of the improper payment rate and 14.7% of the improper payment rate was attributed to medical necessity issues.

CMS recently provided the following guidance in the Thursday, December 1, 2022 edition of MLN Connects (link):

“Shared decision-making (SDM) is an important part of person-centered health care. You work with your patient to make decisions that meet their needs based on:

• Evidence-based information about available options
• Your knowledge and experience
• Patient's values and preferences

When you provide SDM for percutaneous left atrial appendage closure (LAAC) and implantable cardioverter defibrillators (ICDs):

• Document the SDM encounters correctly in medical records before you implant.
• Get preoperative documents from all providers before submitting medical records. While not mandatory, it speeds processing of your claims.

The Comprehensive Error Rate Testing (CERT) contractor reviews your claim documentation to determine if it meets SDM requirements. If it doesn’t, CMS will:

• Issue an error for overpaid claims for these procedure codes
• Recoup the overpayment”

What Can I Do?

If your hospital provides either of these services:

• Ensure documentation in your medical record meets the requirements detailed in the NCD. Palmetto GBA, the Medicare Administrative Contractor (MAC) for Jurisdiction J (Alabama, Georgia, and Tennessee) has published two resources to assist you:
• A Cardiac Procedure Checklist (link) for when a claim is selected for review by the CERT contractor, and
• A Left Atrial Appendage Closure education module (link). Palmetto notes, “This module provides an overview of what Palmetto GBA, and the Comprehensive Error Rate Contractor (CERT) requires in your documentation to support billing of these claims. Shared decision-making (SDM) encounters with the patient is a very intricate part of your documentation.”
• Share this information with your Physicians,
• Respond to Additional Documentation Requests (ADRs) in a timely manner, and
• Have a process in place to ensure that all documents needed to support the medical necessity of the services provided are included when responding to Additional Documentation Requests (ADRs) from Medicare Contractors (i.e., CERT, Recovery Auditor).