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ernieA word to the wise: providers need to make SURE they have a process in place to check ALL (Medicare, at least) claims that go out their door to ensure that a clearly worded, appropriate physician order exists in the medical record – because Connolly seems to have a process to find the ones that are missing physician orders. And if they know how to target this, the other three RACs are sure to follow soon enough.


Even if providers already have such a process in place, they need to CHECK IT. If they do NOT ensure that an order exists, they are risking the entire reimbursement. Not to mention the fact that if a RAC finds enough of these errors at a facility/practice, and another CMS contractor or department decides that a “pattern” of this type of error exists, there may be more than just money is at risk.


Before I get to the subject of the headline, let me review some recent changes made to the RAC new issues list, as I reported on Monitor Monday this week.


Seven New Issues Edited or Posted


Last week was a pretty quiet week, with almost no activity by any of the RACs except for a few additions by Connolly and HDI made on Friday, Sept. 17. Of course, “additions” to these lists are never a straightforward affair.


Connolly added 20 new DRG Validations. As is their habit, however, this was done by grouping these together with some previously approved DRGs, and finally, posting some “new” and some “not-so- new” issues.


  • Duplicate Claims – DMEPOS
  • MS-DRG 056: Degenerative Nervous System Disorders w/MCC
  • MS-DRG 057: Degenerative Nervous System Disorders w/o MCC
  • MS-DRG 249: Perc Cardiovascular Proc with Non Drug-Eluting Stent w/o M
  • MS-DRGs 368, 369, 370, 371, 373, 377, 378, 379, 380, 381, 382, 383, 384, 385, 387, 388, 389, 390, 391, 392, 393, 395: Gastrointestinal Disorders
  • MS-DRG 820: Lymphoma and Leukemia with Major O.R. Procedure w/ MCC


Also last week, the Region D RAC, HDI added to their approved issues list, a single issue concerning Part A services delivered during a hospice period which they say should be bundled with the inpatient claim, therefore not separately payable.


I don’t know whether to consider these “new” issues or not anymore. Regardless, the total number of “posts” I mention above is seven.


These “posts,” however, are not all that happened last week…


Other Edits Made


During the last couple of weeks, there have been many edits made to existing posts on all four of the RAC sites. Mostly, these were “housekeeping” edits, straightening out some double entries or apparently just performed for the purpose of making lists even more confusing for providers. But the most interesting edits were those that removed DRGs or states from lists.


For example, many posted issues for Region A, DCS in fact removed some states from lists of some of their approved issues. Check the list, especially if you are in Vermont, New Hampshire or Maine (Vermont was dropped from 14 issues, New Hampshire from 12, and Maine from a lesser number).


On HDI’s site, covering Region D, there was an edit to their posted issue concerning Acute Readmissions. Previously, the issue would deny for same-day acute readmissions for the same DRG with no B4 Condition Codes on the second claim. Now, it denies for no B4 or 42 Condition Codes on the second claim.


Another edit made in Region D: under the DRG Validation issue for Nervous System Disorders, MS-DRGs 075 and 076 were removed from the approved DRG list.


But let’s get to the really important topic for the week, and show why providers need to ensure that they have appropriate physician orders in their medical records.


Denials for Lack of Physician Order


Despite a lack of activity on the lists themselves, the RACs have been very busy, sending out review results letters and denials. Region C saw the first denials for a lack of proper physician orders in a medical record, with both inpatient and outpatient claims being denied. I can give you two examples that happen to be short stays.



An outpatient example: in this case, the patient stay lasted three days. At some point, the patient’s status was changed to inpatient, which would have been appropriate (I’m told by the provider) except for one thing: in the documentation there was a Nurse’s note changing the patient status to inpatient, but there was nothing at all in the record to indicate that a physician ever approved or ordered the change. The claim therefore was denied, and the provider has no chance on appeal, because the physician’s order simply does not exist.


An inpatient example: this one was a one-day stay in which the patient was admitted as an inpatient despite clocking just an eight-hour hospital visit. I was told that the services rendered were, in fact, inpatient services, and could have survived audit for inpatient status, except for one thing: no physician order appeared in the record to admit the patient to anything. Once again, the claim was denied; and again, there is no chance to appeal, since the order simply does not exist.


The provider with whom I was speaking was, to say the least, more than a little disturbed by how quickly and easily the RAC found these errors. Those claims were very easy to deny, and they did not offer any chance to appeal the decision. The provider also told me that the number of records requested was very few compared to the limits that the RAC could ask for. In other words, the RAC knew exactly which records to ask for, and they were right on the money.


It seems like this is the proverbial “easy money” for the RACs.


Why Did They Wait?


One might ask the question: if this is so easy, why haven’t the RACs been doing this more prior to now? My opinion is that the RACs have been waiting for at least some of the Medical Necessity issues to be released so they wouldn’t have to ask for records again, or so that they can have all their weapons loaded before they begin the battle in earnest.


The RACs are private companies that actually care about efficiency. In the private sector, efficiency means more profits, and this makes private-sector companies much better at this kind of work than many government agencies that don’t have to worry about such bourgeois concerns as “profits.” I’m not accusing public agencies of not caring about efficiency; I just think their motivation is different. A private firm that is inefficient for long enough will simply disappear. Not necessarily so with public agencies.


So What’s the “Word”?


Providers need to ensure that they have a reliable process in place to check documentation for physician orders before any claim is filed.


Which ones should they check? Every one they intend to send out the door.


The RACs are willing to do this job for just nine percent of the claim (in Connolly’s case, anyway). A provider, then, should be willing to do this for slightly more than that … say, 100 percent of the claim.


So I guess I’ll say that’s the “word:” 100 percent.


About the Author


Ernie de los Santos is the chief information officer for eduTrax®. He joined the company at its inception and has been responsible for the creation, development and maintenance of the eduTrax® portals – a set of Web site devoted to providing knowledge, resources and compliance aids for U.S. healthcare professionals who are involved in revenue cycle management.


Contact the Author




To read, “Hospital to Pay $2.2 Million,” please click here


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