In December 2020, the Centers for Medicare & Medicaid Services (CMS) published a request for comments on the proposed Review Choice Demonstration Project, or RCD for Inpatient Rehabilitation Facilities (IRF). Comments were received, and CMS finalized the plan to roll out this pre-claim or post-payment review. This project was delayed due to the pandemic, however, it was never forgotten by CMS. The rollout in Pennsylvania is scheduled for June 17, 2024!
What is the Demonstration Project?
The Inpatient Rehabilitation RCD would review 100% of a provider’s Medicare Fee For Service (FFS) claims, either pre-claim or post-payment. The project is being rolled out systematically, beginning with four states: Alabama, Texas, Pennsylvania, and California. The reviews are planned to continue until each provider reaches a pre-determined claim approval rate.
Why is Such an Effort Necessary?
In 2018, the Office of the Inspector General (OIG) conducted a study on admissions to IRFs and determined that a significant number of admissions to inpatient rehabilitation were not medically necessary. Hence, a “demonstration project” was designed to help to identify inaccurate payments before or immediately after disbursement to decrease inaccurate payments.
What Does That Mean for IRF/IRU Providers?
One of the most significant impacts that will be experienced by IRF or Inpatient Rehabilitation Units (IRU) is the necessity to submit medical records in a timely manner. If you choose the pre-claim submission, you will be transmitting the PAS, History and Physical and Therapy evaluations within the first three days of admission!
The Pre-Admission Screen (PAS) is a document that is required in regulation; however, it is generated prior to the actual time of admission to the IRF/IRU. Is your organization prepared to include the document(s) that have been generated prior to an IRF/IRU admission as part of the submission of the medical record for the RCD?
CMS has reported that organizations will have the option to choose either pre-claim or post-payment review. To make the appropriate decision for your organization, your Chief Financial Officer (CFO) should be aware of the need to make this selection, and diligence should be exercised to watch for the opportunity to make this decision. It may be wise to create a model to help the CFO make the best decision – pre or post. Often, the decision is made to select a post payment review so the immediate cash flow is not impacted; however, if your internal audit process has identified a potential higher rate of non-compliance, a pre-payment review could prevent significant adjustments down the road.
But perhaps one of the most significant issue for IRFs is that it is CMS’ intent to roll out the process for all states/jurisdictions. Even if you are an IRF provider that is not located in one of the first four states in which the Demonstration will be rolling out, it is coming. It will be important for organizations in all states/jurisdictions to watch the progress and findings of the initial movement. Incorporation of these findings into a proactive action plan in your IRF will be critical.
What if Records Are Found to be Non-Compliant?
Following review in the RCD, should any of the records submitted be found non-compliant, the claim will not be paid or recoupment will be made. When considering the number of Medicare FFS patients admitted to your IRF/IRU, the financial impact to your organization could be significant.
How Can This Potential Risk Be Mitigated for Your IRF/IRU?
Proactive audits of your medical records are the first step in mitigating potential risks followed by implementing corrective actions based on the results of the medical record audit. Many providers do not audit their records regularly, or if they do, no actions are implemented as a result of the audit. This “lack of action” is especially critical because of the potential risk of allegations of False Claim Act violations.
What Should You Do to Prepare for the IRF Demonstration Project?
- Be proactive to avoid denials. Conduct audits of your IRF records to identify potential issues and implement corrective actions to mitigate those risks.
- Based on the level of compliance of your IRF/IRU medical records, collaborate with your CFO to discuss the best choice for either pre-claim or post-payment reviews for your IRF.
- Collaborate with Health Information Manager (HIM) to ensure all critical documents are included in the submittal of IRF Records (e.g., Preadmission Screen).
- Ensure HIM is ready and able to submit the potential volume of records within the identified time frame.
How Can LW Consulting, Inc. Help?
LW Consulting, Inc. has experience in performing IRF audits as part of an IRO, and for healthcare systems. We will assist you with corrective action plans and implementation to make sure documentation supports medical necessity. LWCI can provide education to your physicians and clinical staff to reduce potential risk within your program.
For more information, contact Kay Hashagen, Senior Consultant, at 410 207-8338 or email [email protected].
