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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor. | ©2016 CliftonLarsonAllen LLP
Medicare Regulations and Rules Update – What Should You Know? Presenters: Gary Massey, CPA & Emily Wetsel, CPA
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Course Objectives
• Discuss the Overpayment Rule and Lookback Period and how it affects Hospice & Palliative Care
• Discuss False Claims Act and Other Relevant Regulations and Rules
• Other Revenue related topics • Q&A
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Final Rule: Overpayments, Lookback Period and False Claims Act
How do these final rules affect Hospice and Palliative Care agencies?
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Reporting and Returning of Overpayments: FINAL RULE • Part of ACA • Effective March 14, 2016 • Final Rule provides needed clarity and consistency in
reporting and returning the self-identified overpayments
• Why the Overpayment Rule? – Promotes the furnishing of high quality care – Protect Medicare Trust Funds against fraud and improper
payments
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Reporting and Returning of Overpayments: FINAL RULE • Self-Identified overpayments (OP) must be reported
and returned by the LATER of: – The date which is 60 days after the discovery of OP – The date any corresponding cost report is due
• Overpayment Definition
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Reporting and Returning of Overpayments: FINAL RULE • Methods of Returning Overpayments
– Claims Adjustment – Credit Balance – Self-Reported Refund – Other appropriate process to satisfy overpayment
• Provider must notify appropriate party in writing of identified overpayment – State, Intermediary, CMS Contractor, etc.
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Reporting and Returning of Overpayments: FINAL RULE • The Overpayment Rule is not unique to Hospices, its
universal to all “HealthCare” – and you must comply like any other provider in order to participate in the Medicare program
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Consequences
• Providers failing to self-report and/or return overpayments could face potential – False Claims Act (FCA) liability – Civil Monetary Penalties Law liability – Exclusion from federal health care programs
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
False Claims Act (FCA Liability)
• Civil Liability for knowingly presenting a false or fraudulent claim
• No specific intent to defraud the government is required
• Examples include upcoding, billing for unnecessary services, billing for services/items not rendered, and billing for services provided by an excluded individual
• FCA protects all “whistleblowers” who alert the government of suspicious activity (financial incentive to whistleblow)
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
False Claims Act (FCA Liability) continued
• With the increase in the number of law suits regarding FCA liability, some law offices now specialize in this type of litigation against providers
• Provider could be liable for three times the dollar amount the government is defrauded and civil penalties ($5-10K) for each false claim.
• $5.86 Million Dollar to resolve Hospice Fraud Allegations in Jackson, MS (St. Joseph Hospice Entities)
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
False Claims Act (FCA Liability) continued
• The Challenge to providers is to create a Culture of Honesty and High Ethics! – Setting the tone at the top – Creating a positive work enviornment – Hiring and promoting appropriate employees – Providing sufficient training – Confirming accountability for code of conduct – Implementing effective discipline
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Lookback Period – How does this fit in??
• Lookback period reduced to 6 years (previously 10 years)
• Lookback period will be measured back from the date the person identifies the overpayment
• Hopes to lessen burden on providers with a shorter lookback period
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice CAP • Hospice CAP is a “safety” valve for Medicare to avoid
overpayment • Hospice CAP Implications in regard to FINAL RULE? • Self-Determined CAP Calculation – Moving Forward
– Agencies responsible for filing CAP calculation with FI – 2016 CAP amount is $27,820.75…Period – 11/1/15 to
10/31/16 – 2017 CAP amount is $28,404.99…Period – 10/1/16 to
9/30/17 – If overpayment calculated, payment is due with the
calculation – One page calculation, intuitive
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Other Hospice Regulations and Changes
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Charges
• The Major payer for most hospice care is Medicare
• How do you get payments? Look at a sample PS&R…
• How do you set charges? Look at an example…
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Reimbursement • Four levels of care – NC rural rates
– Routine Home Care: ◊ Services provided in patient’s “home” including a private home, assisted
living facility, nursing home. ◊ 90%+ of hospice services tend to be Routine ◊ Effective 1/1/16, Medicare adopted a two-tiered payment system for
routine home care: ◊ For the first 60 days of patient’s care, Medicare pays hospices
$164.36/day; over 60 days of care paid $129.23/day. ◊ For hospice nursing and SW services provided in the last 7 days of life,
Medicare pays an additional $34.67/hour up to 4 hours/day.
– Continuous Home Care ◊ Supports the patient and caregivers at home through brief periods of
crisis to manage acute medical symptoms ◊ $34.67/hour up to $832.07/day
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Reimbursement (continued)
• Four levels of care (continued)
– Respite Care ◊ Provides up to 5 days relief to the caregiver ◊ $152.46/day
– General Inpatient Care ◊ Provides for short-term pain control or acute symptom management in a
hospital, inpatient hospice unit or SNF. ◊ $640.85/day
– 2017 Hospice CAP limit $28,404.99 • Note: All rates above are the FY17 Medicare rates for rural
North Carolina hospice providers • Reminder that Medicaid is behind in changing over their
software to make the two-tier payments
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Changes
• Medicare – Final rule - rate increase of 2.1% for FY17 (inflation update
of 2.7%, reduced by 0.3% productivity adjustment and 0.3% ACA adjustment); but 2% sequestration continues.
– President’s budget proposes a 1.7% rate reduction in each of 2018, 2019, and 2020.
– MedPAC recommends no rate update for hospice. – ACA calls for a “rebasing” of Hospice rates which could
have a negative impact on future payments for Hospice services
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Changes (continued)
• Regulatory Oversight – Increasing scrutiny of
hospice due to substantial increase in overall spending ◊ OIG focused on hospice
provided in nursing homes and assisted living facilities; extensive length of stays; and GIP level of care
◊ Intermediaries are reviewing and denying more claims
• Quality Reporting – Additional quality data required from hospices – Hospice Compare with star ratings likely by next year
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WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING
Hospice Changes (continued)
• Medicare Advantage/Managed Care – Currently Advantage plans allow patients to dis-enroll
from their plans and return to traditional Medicare hospice.
– MedPAC and U.S. Senate support bills to require Medicare Advantage plans to keep patients in their plans who request hospice.
– Industry is concerned over Advantage plans’ ability or expectation of “managing” the full Medicare hospice benefit.
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©2016 CliftonLarsonAllen LLP
Questions?
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CLAconnect.com
Contact Information: Gary Massey, CPA Principal [email protected] Emily Wetsel, CPA Manager [email protected]
