Michigan Health Law Link : Michigan Health Care Lawyer & Attorney : Smith Haughey Rice & Roegge Law Firm : Ann Arbor, Grand Rapids, Traverse City

On May 16, 2010, the Centers for Medicare and Medicaid Services (CMS) issued Transmittal 327 which revises the signature requirements for medical review activities of Medicare claim review contractors. Transmittal 327 has an effective date of March 1, 2010 and an implementation date of April 16, 2010, but the changes are effective retroactively to the November 2010 report period for comprehensive error testing. The transmittal updates Chapter 3, Section 3.4.1.1 of the Medicare Program Integrity Manual to require that services provided or ordered for medical review purposes are authenticated by the author. The previous version of this section only required authentication by a legible identifier. Specifically, Transmittal 327 amends Section 3.4.1.1 to:

1. Expressly state that stamp signatures are not acceptable. The transmittal clarifies that the method of authentication for services provided or ordered for medical review purposes must be by handwritten or electronic signature.
2. Add a new exception for clinical diagnostic tests when a treating physician, who authenticates medical documentation by handwritten or electronic signature, indicates that he or she intended the clinical diagnostic test be performed. The amended section suggests that such medical documentation could be in the form of a progress note.
3. Provide that if handwritten signatures are illegible, reviewers should consider evidence in a signature log or attestation statement to determine the identity of the author.
4. Finally, when providers fail to meet handwritten signature requirements of Section 3.4.1.1, reviewers should contact providers to inquire as to whether they want to submit an attestation statement or signature log within 20 calendar days.

Interestingly, Transmittal 327 appears to reconcile with similar regulations concerning signatures and authentication of orders, which are contained in the Medicare Conditions of Participation at 42 CFR 482.24(c)(1), by expressly indicating that other regulations and CMS instructions take precedence over signature guidelines set forth in Section 3.4.1.1. Thus, only when the relevant regulations, national or local coverage determinations, and CMS manuals lack specific signature requirements and/or guidelines to determine legibility or presence of signatures for medical review purposes, should Section 3.4.1.1 requirements be followed.

Therefore, based on the new information from CMS in Transmittal 327, acceptable methods for handwritten signatures are:

• a legible full signature;
• a legible first initial and last name
• an illegible signature accompanied by signature log or attestation statement;
• initials over a printed or typed name; and
• initials accompanied by a signature log or attestation statement.

On the other hand, unacceptable signature methods are as follows:

• Rubber stamp signatures, except for clinical diagnostic tests when a treating physician who authenticates medical documentation by handwritten or electronic signature, indicates that he or she intended the clinical diagnostic test be performed;
• illegible signatures with no additional documentation to identify the signature;
• initials with no additional documentation identifying them;
• an unsigned note; and
• a note with the statement “signature on file.”

Smith Haughey Rice & Roegge will continue to monitor developments in this area and distribute updated information as it becomes available.

Summer clerk Charissa Huang contributed to this post.

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We have been waiting all summer for something to happen with the RAC audits.  Finally, as of August 4th, it looks like the action may beginning to break.  Connolly Consulting, the Recovery Audit Contractor for Region C, has just released a list of seven issues that have been approved by CMS for its initial automated reviews.  These seven "issues" are:

1. Blood Transfusions.
2. Untimed Codes.
3. IV Hydration Therapy.
4. Bronchoscopy Services.
5. Once in a lifetime procedures.
6. Pediatric codes exceeding age parameters.
7. J2505: Injection, Pegfilgrastim, 6 mg.
 

While is it not clear whether these issues are specific only to Connolly and Region C or whether the other RAC auditors will be using this same list to begin their automated reviews, health care providers would be wise to take this list and begin to run some internal data to assess accuracy in coding and billing as it relates to these topics.  Problems should be corrected immediately and over-payments refunded.

For those located in Region B (including Michigan), it is probably a good idea to get in the habit of checking the CGI website on a regular basis going forward to make sure that you have as much advance notice as possible, in the event CGI posts its own list of approved issues for automated review.

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In the face of Section 111 and the industry's effort to comply with same, some good news for a change!

On July 29, 2009, the Second Circuit ruled that the Medicare Secondary Payer Statue does not permit a private individual to file a qui tam action on behalf of the federal government.  In this case, the plaintiff tried to file suit against an insurance company alleging that the company had failed to meet its obligations to ensure that it, and not the Medicare program, paid for certain claims for medical care from its insureds or others it was obligated to cover.  See Woods v. Empire Health Choice, Inc.  No. 07-4208-cv (2d Cir. July 29, 2009).

While this is a great result for health care insurers and self-insured providers who have more than enough to worry about right now, it is also a good reminder of something to be mindful of as more and more individuals are becoming aware of the new lottery game that is the qui tam lawsuit.  For those outside the jurisdiction of the Second Circuit, remember that this decision is something to hope for but not binding on your federal courts.  Good faith efforts to comply with the MSP (and Section 111) reporting obligations is very important both in the context of your interaction with the Medicare program but also in your interaction with your employees and other individuals who may be watching and questioning your conduct and your commitment to do what is right. 

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I have read Section 111 and all of the guidance put out by the Centers for Medicare and Medicaid Services ("CMS"), listened to most of the the teleconferences sponsored by CMS on the subject and had the opportunity to talk to different clients and stakeholders about the new requirements and what they are hearing from various consultants and legal advisers about the new reporting requirements.  And, what I have concluded from all of this reading, listening and talking is the following:

• There are lots of attorneys and consultants out there scaring and confusing hospitals and hospital insurers about Section 111 and what CMS is going to do with this new reporting system;
• The Medicare Secondary Payer system and these new reporting requirements are a much greater burden for workers' comp and no fault carriers than other NGHP liability insurers (and I never appreciated that until recently);
• CMS keeps saying that this new reporting system is, for them, at least for now ... about collecting data and NOT about trying to find liability insurers who they can make "pay twice" for a Medicare beneficiary's medical expenses;
• As it relates to what goes on in health care, with respect to patient complaints and disputes and the settlement of those disputes, there is A LOT that CMS is still trying to understand and figure out so, there is A LOT we don't know yet about what does and does not have to be reported;
• If you are a self-insured hospital ... if you are "first dollar" self-insured ... unless your excess carrier is telling you that they will act as your reporting agent, it is probably a good idea to register with CMS some time over the next month or two and test your system so that you can report if you have to;
• CMS has said on numerous occasions that you don't have to register if you don't think you will have anything to report so, for now, if you are an insured hospital that doesn't expect to "settle" a dispute with a Medicare beneficiary outside of your insurance policy, for more than $5,000, you can relax a bit ... let's wait and see what CMS does;
• If you are an insured hospital and you have a "deductible" your insurer can and probably will work with you to establish a system so that you don't have to report anything ... talk to them and if they say there is nothing they can do ... might be time to shop for insurance; 
• CMS is still learning and thinking about health care providers and the little patient related settlements you enter into from time to time with your patients when they are unhappy ... they understand that they don't need to know about all of those, despite the way the current guidance reads and there will likely be better guidance in the future to carve some of that out of the reporting requirements; and
• CMS is not, in this particular instance, looking for the "gotcha" moments ... i.e. this is not about CMS looking for opportunities to slap $1,000 per day fines on insurers and self-insured providers.  If you make a good faith effort to understand what you have to report and if you try to report correctly, you will get a chance to learn how to do it right.

Bottom line, if you are a liability insurer or a TPA for a self-insured health care provider, you have to register and you should get working on that right away ... developing the appropriate procedures and working through the IT issues will take time so don't delay.  If you are a self-insured hospital or other health care provider, you have two options: (1) register and set up the internal systems to begin reporting, or (2) hire a Section 111 reporting agent (a new cottage industry ... part of the federal stimulus plan!!!).  If you are an insured health care provider, take a breath and sit tight, there is more to come on what if anything you might have to report and since the registration deadline has been extended to September 1 and you don't have to report any settlements that occur before January 1, 2010, lets just wait and see what CMS does.   CMS may clarify some of the confusion over the next few months and things might not be so bad after all.

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I just spent three days at a national conference in Baltimore, MD where all things Medicare and Medicaid were discussed.  There is no way to give sufficient detail in a blog post to all that we discussed and all that there is to think about and attend to following this conference but, let me share just a few of the highlights...

The Anti-Markup rule continues to be on the minds of attorneys advising health care providers.  If you work with physicians who bill globally for diagnostic tests that they order, the time is now to make sure that those diagnostic services are being billed appropriately by the physician.  Particularly as it relates to the professional interpretations of those services, the options for physicians are very limited.  More importantly, what was okay last year may not be now so just because it was an arrangement previously blessed, doesn't me that it still is ... time to check.  On the technical component side, remember that the technical component of a diagnostic test is performed where the patient is AND where the supervising physician is while the test is being done.  And, remember that if you don't get this right, you can be left without the ability to bill anything.

Lots of people paying attention to "patient status"... i.e. inpatient, outpatient and observation status.   The coordination of medical staff and hospital bylaws, hospital policies, and physician documentation to get the patient slotted into the correct status seems to have many health care institutions and their attorneys on edge.  Certain the RACs don't help with the stress here.  Pay attention to Condition Code 44 for a patient that you are moving from inpatient to outpatient status.  Apparently, there are a lot of hospitals and providers that may not realize that this change needs to be made BEFORE the patient leaves the hospital if you are going to bill the maximum amount. 

Since I mentioned them, on the subject of RACs, it appears that the "good news" may be that providers will likely see coding audits start before the medical necessity audits.  In addition, it appears that health care providers will get some notice as the RACs expand their medical necessity scope.  CMS has indicated that before RACs can expand the scope of their medical necessity audits to review new "issues", they must get approval from CMS and CMS intends to post those new issues on its Web site if the RACs are granted authority to audit those issues.  On the less good news side of things, physicians should expect to get a fair amount of attention in this round of RAC audits.  CMS has indicated that the RACs will be doing crossover audits of physicians when they find hospital admissions that seem to raise concern.   Condition Code 44 came up in this discussion as well.  Clearly there is a sense that hospitals have not been handling the use of this code correctly.  Finally, CMS has indicated that RACs will have authority to review the use of "present on admission" codes as part of their coding reviews.

But, as usually, the most interesting discussions, at least for me, focused on Stark and the latest word on the DFRR.  The conference began with the buzz about the OIG Open Letter indicating that the voluntary disclosure protocol is no longer available for the disclosure of violations that involve only the Stark law and not the Anti-Kickback statute.   There was much debate about whether this new OIG position suggest that the OIG is overwhelmed by disclosures of potential Stark violations (suggesting that perhaps its too easy for a health care provider to find itself cross ways with Stark) or whether it suggests that OIG intends to more aggressively go after Stark violations and no longer wants providers to seek the safe haven of the voluntary disclosure protocol to take away their opportunity.   I will admit that I tend to be more of a skeptic as to OIG's intentions the more that I think about the DFRR.

The latest word on the DFRR is still that no one knows for sure if or when hospitals that are going to get the DFRR questionnaire will get it.  The expectation is that of the 400 that may go out, approximately 290 of those will go to all of the hospitals that got the original voluntary survey request in 2006 and failed to respond.  That means that if you were not one of those hospitals, your chances are slim that you will get a questionnaire ... at least in this first round.  Still, if you don't feel particularly lucky or just want to continue to move forward in getting a handle on some of your Stark compliance stuff, here are some good suggestions that came out of these discussions: 

• query your accounts payable, check ledgers, and accounts receivable department for a list of ALL financial arrangements involving a physician;
• look for all leases for equipment and space that involve physicians;
• get a complete handle on your non-monetary compensation tracking and your medical staff incidental benefits;
• gather all of the documentation you can find for all of these;
• check them all for compliance with at least one Stark exception;
• for any possible non-compliance, determine whether you are in a "period of disallowance"; and
• before you even think of responding to a DFRR request, if you get one, check with legal counsel.  Because of the details of the questionnaire, how you respond is very important.

Obviously, this is just a small window into what was three solid days of all that is Medicare.  There is certainly more to come on this topic, particularly given that the season of CMS proposed payment rule is just about to begin.

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On November 18, 2008, as part of the 2009 OPPS Final Rule, CMS provided a "clarification" of its position regarding what level of physician supervision is required for the provision of on-campus outpatient therapeutic services.  

Prior to November 2008, the provider community understood that CMS' position was that the direct supervision requirements for services provided incident to a physicin's services in an on-campus outpatient department was properly presumed to be met because staff physicians are always around in a hospital.   CMS has indicated that it is concerned that hospitals have taken its prior expression of presumptive compliance to mean that no supervision was actually required at all. 

While the OPPS Final Rule does not go further to state specifically that a physician must be physically present in an outpatient department of a hospital at all times, this "clarification" does seem to at least open the door for hospitals to be questioned about how, specifically, they meet the direct supervision requirements applicable in their various outpatient departments, where therapeutic services are provided. 

In support of the sense that CMS is moving in this direction, it is also worth noting that in December of 2008, CMS revised language in its Medicare Benefit Policy Manual regarding provider-based services to indicate that "direct supervision" means that a physician must be present and on the premises of the provider-based department and immediately available to furnish assistance and direction.

Hospitals would, in light of these developments, be advised to evaluate all outpatient department and provider-based locations to evaluate the extent to which the services provided at those locations require direct physician supervision and then make sure they have a plan in place to meet that requirement. 

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Hospitals periodically develop anxiety over the use of signature stamps by medical staff members.  Many institutions have gone so far as to say "no" to any and all signature stamps.  Others have limited use of signature stamps so that only the physician him or herself can use the stamp and, frankly, if the physician is the only one who can use the stamp ... "What is the point?"

Well, based upon CMS Transmittal 248, issued early in the spring, it would appear that there is no point in having signature stamps for physicians because they are not acceptable and will not be given any credit if CMS audits for signed orders or other medical record documentation where a physician signature is required.

What is perhaps even more troubling about the language in this Transmittal is not that CMS appears to be putting an end to the usefulness of the signature stamp,  but that CMS has cleared the way for auditors to deny claims based solely on the type or lack of physician signature.  This is true even if all other aspects of the documentation support the medical necessity and appropriate delivery of the service. 

So, at this point, hospitals should be sending out alerts to their medical staff members, advising them that signature stamps are not allowed for use anywhere in the medical record.  Outpatient diagnostic departments such as lab and radiology should be advised that orders for services that come with a stamped signature as the authorization for the service cannot be accepted.  Failure to take this approach could result in overpayment problems during an audit. 

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