There are 50 Shades of Grey in federal prepayment review.
I hate wishy-washy laws. If a law exists, in my mind, it should be specific. However, that is not always the case.
Let me give an example. Let’s take, for example, prepayment review (PPR).
In North Carolina and many other states, PPR is statutorily defined in a two-page-long statute. Here, is Statute 108C-7, and it says, in the pertinent part:
“The provider shall remain subject to the prepayment claims review process until the provider achieves three consecutive months with a minimum seventy percent clean claims rate, provided that the number of claims submitted per month is no less than fifty percent of the provider’s average monthly submission of Medicaid claims for the three-month period prior to the provider’s placement on prepayment review. If a provider does not submit any claims following placement on prepayment review in any given month, then the claims accuracy rating shall be zero percent for each month in which no claims were submitted. If the provider does not meet the seventy percent clean claims rate minimum requirement for three consecutive months within six months of being placed on prepayment claims review, the Department may implement sanctions, including termination…”
Juxtapose this to the federal regulations applicable to Medicare:
42 CFR 405.903 is a much terser regulation. It states that a contractor may select a claim(s) for prepayment review. In conducting PPR, a contractor may issue additional documentation requests to a provider. But the regulation does not specify how many, a percentage, or any time frame. I find the federal regulation to be underwhelming and non-specific.
The federal regulation also allows a provider to have 45 days to submit documentation unless good cause exists for the lateness, but the contractor conducting the PPR can decide if good cause exists. Remember, the state statute for PPR states that penalties will be wielded upon failure of PPR. In Medicare, PPR will result in an initial determination under section 405.920, which states:
“After a claim is filed with the appropriate contractor in the manner and form described in subpart C of part 424 of this chapter, the contractor must:
(a) Determine if the items and services furnished are covered or otherwise reimbursable under title XVIII of the Act;
(b) Determine any amounts payable and make payment accordingly; and
(c) Notify the parties to the initial determination of the determination in accordance with § 405.921.”
Notice that the federal regulation details much less, seemingly leaving much to the discretion of the contractor. There is no penalty mentioned; instead, the contractor is given complete authority to decide how to proceed.
Programming note: Listen to the live RAC Report by healthcare attorney Knicole Emanuel, Mondays on Monitor Mondays, 10 a.m. EST.
Grab your pens, alert your billing teams, and cue up your electronic medical record (EMR) vendors, because the Centers for Medicare & Medicaid Services (CMS)
Gilead Sciences, Inc. has agreed to pay $202 million to settle allegations raised by whistleblower Dr. Paul Bellman that Gilead violated the False Claims Act
Please log in to your account to comment on this article.
Stop revenue leakage and boost hospital performance by mastering risk adjustment and HCCs. This essential webcast with expert Cheryl Ericson, RN, MS, CCDS, CDIP, will reveal how inaccurate patient acuity documentation leads to lost reimbursements through penalties from poor quality scores. Learn the critical differences between HCCs and traditional CCs/MCCs, adapt your CDI workflows, and ensure accurate payments in Medicare Advantage and value-based care models. Perfect for HIM leaders, coders, and CDI professionals. Don’t miss this chance to protect your hospital’s revenue and reputation!
Struggling with ICD-10-CM coding for diabetes and complications? This expert-led webcast clarifies complex combination codes, documentation gaps, and sequencing rules to reduce denials and ensure compliance. Dr. Angela Comfort will provide actionable strategies to accurately link diabetes to complications, improve provider documentation, and optimize reimbursement—helping coders, CDI specialists, and HIM leaders minimize audit risks and strengthen revenue integrity. Don’t miss this chance to master diabetes coding with real-world case studies, key takeaways, and live Q&A!
Uncover critical guidance. HIM coding expert, Kay Piper, RHIA, CDIP, CCS, provides an interactive review on important information in each of the AHA’s 2025 ICD-10-CM/PCS Quarterly Coding Clinics in easy-to-access on-demand webcasts, available shortly after each official publication.
Uncover critical guidance. Kay Piper provides an interactive review on coding guidelines and more in the AHA’s fourth quarter 2025 ICD-10-CM/PCS Coding Clinic in an easy to access on-demand webcast.
Stay ahead of Medicare Advantage’s 2025-2026 regulatory changes in this critical webcast featuring expert Tiffany Ferguson, LMSW, CMAC, ACM. Learn how new CMS rules limit MA plan denials, protect hospitals from retroactive claim reopenings, and modify Two-Midnight Rule enforcement—plus key insights on omitted SDoH mandates and heightened readmission scrutiny. Discover actionable strategies to safeguard revenue, ensure compliance, and adapt to evolving health equity priorities before the June 2025 deadline. Essential for hospitals, revenue cycle teams, and compliance professionals navigating MA’s shifting landscape.
Struggling with CMS’s 3-Day Payment Window? Join compliance expert Michael G. Calahan, PA, MBA, CCO, to master billing restrictions for pre-admission and inter-facility services. Learn how to avoid audit risks, optimize revenue cycle workflows, and ensure compliance across departments. Critical for C-suite leaders, providers, coders, revenue cycle teams, and compliance teams—this webcast delivers actionable strategies to protect reimbursements and meet federal regulations.
Providers face increasing Medicare audits when using skin substitute grafts, leaving many unprepared for claim denials and financial liabilities. Join veteran healthcare attorney Andrew B. Wachler, Esq., in this essential webcast and master the Medicare audit process, learn best practices for compliant billing and documentation, and mitigate fraud and abuse risks. With actionable insights and a live Q&A session, you’ll gain the tools to defend your practice and ensure compliance in this rapidly evolving landscape.
Dr. Ronald Hirsch dives into the basics of Medicare for clinicians to be successful as utilization review professionals. He’ll break down what Medicare does and doesn’t pay for, what services it provides and how hospitals get paid for providing those services – including both inpatient and outpatient. Learn how claims are prepared and how much patients must pay for their care. By attending our webcast, you will gain a new understanding of these issues and be better equipped to talk to patients, to their medical staff, and to their administrative team.
Copyright © 2025 RACmonitor. Powered by MedLearn Media.
Happy National Doctor’s Day! Learn how to get a complimentary webcast on ‘Decoding Social Admissions’ as a token of our heartfelt appreciation! Click here to learn more →
CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 2 with code CYBER24
