OIG Study Shines Spotlight on Medicare Advantage Plans’ Payment Practices

©2023 Elizabeth E. Hogue, Esq. All rights reserved.

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Enrollment  in Medicare Advantage Plans (MAPs) recently exceeded the number of beneficiaries in the Medicare fee-for-service (FFS) program. The number of enrollees in MAPs will undoubtedly continue to increase. In April of 2022, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS) issued Report OEI-09-18-00260, “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care” concerning the payment practices of MAPs. 

First, the OIG confirmed that MAPs must cover the same services as FFS. According to the OIG, MAPs must follow Medicare coverage rules that specify what items and services are covered and under what circumstances. MAPs may not impose limitations that are not present in FFS Medicare. The OIG also pointed out that MAPs may impose additional requirements; such as the use of in-network providers for certain health care services, requiring prior authorization, and referrals for specialty services.

Since MAPs are paid on a capitated basis, the OIG is concerned that payments create incentives for MAPs to deny access to services and payment in order to increase profits. The purpose of the Report was to assess the extent to which denied requests for preauthorization and payment met Medicare rules and would likely have been approved in FFS Medicare.

Based upon this review, the OIG concluded that:

1. MAPs sometimes delayed or denied beneficiaries access to services even though the requests met Medicare coverage rules.
2. MAPs also denied payments to providers for some services that met both Medicare coverage rules and MAP billing rules.
3. Regarding prior authorization requests that MAPs denied, 13% met Medicare coverage rules and these services likely would have been approved for beneficiaries under FFS.
4. Common causes of denials of prior authorization requests included MAPs’ use of clinical criteria that are not included in Medicare coverage rules and MAP staff members who overlooked documentation that showed that the services were medically necessary.
5. The OIG also concluded that 18% of requests for payment denied by MAPs met Medicare Coverage rules and MAP billing rules. Most of these denials were caused by human error during manual processing of claims, such as overlooking documents, and system processing errors, such as outdated programs.
6. Denials of both prior authorization and payment requests were often reversed when beneficiaries or providers disputed the denials.

What providers have long suspected has been confirmed by the OIG. Now fix it!

Renewed ABN Form

NAHC

Home health and hospice providers are reminded that the Advanced Beneficiary Notice of Noncoverage (ABN), Form CMS-R-131, and form instructions have been approved by the Office of Management and Budget for renewal.

The use of the renewed form with the expiration date of 01/31/2026 will be mandatory on 6/30/23. Providers may continue to use the ABN form with the expiration date of 6/30/23 until the renewed form becomes mandatory on 6/30/23. The ABN form and instructions may be found here in the downloads section.

The ABN, Form CMS-R-131, is issued by providers (including independent laboratories, home health agencies, and hospices), physicians, practitioners, and suppliers to Original Medicare (fee for service – FFS) beneficiaries in situations where Medicare payment is expected to be denied. The ABN is issued in order to transfer potential financial liability to the Medicare beneficiary in certain instances.

Guidelines for issuing the ABN can be found beginning in Section 50 in the Medicare Claims Processing Manual, 100-4, Chapter 30 (PDF).

The 2024 Hospice Proposed Rule: A View into the Future of Hospice

WellSky

On Friday, March 31, 2023, the U.S. Centers for Medicare & Medicaid Services (CMS), released the proposed payment rule for hospice providers for fiscal year 2024. CMS proposed to update hospice payments by 2.8% which would increase hospice payments by $720 million (compared to the FY2023 payments). In addition, there are important proposed updates to the Hospice Quality Reporting Program, the hospice certification process, the Hospice Outcomes and Patient Evaluation tool, and more.

Hospice regulatory expert Katherine Morrison RN, MSN, CHPN, recently presented an informational webinar that covered key elements of the proposed rule and explored the changes your team should understand as you prepare for 2024. If you missed it, you can watch it on-demand.

The 2024 hospice proposed rule is an important opportunity to see into the near future of hospice care. It’s also a time for hospice providers to consider the impact of the proposed changes and prepare well-informed comments. Comments to CMS must be received by May 30 to be considered for the final rule.

View Recording of Webinar

Medicare Proposed [ACCESS] Rule Webinar on May 25

Join the Home Care Association of America (HCAOA) and the Association for Home & Hospice Care of North Carolina (AHHC of NC) for an informational webinar on the Centers for Medicare and Medicaid's newly proposed rule on Thursday, May 25, from 11:00 a.m. - 12:00 p.m., EST.  

Legal expert Matthew Wolfe of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC will discuss how the proposed rule would impact home care services in the U.S. and the development of HCAOA's comments to CMS.

This webinar is free and open to all home care providers. Registration is required.

Register for Free