All Skilled Nursing Facilities Face MAC-Probe and Educate Review Starting June 5

All health care providers should review improper payment report

Beginning June 5, Medicare Administrative Contractors (MAC) will begin pulling five claims from every skilled nursing facility (SNF) in their jurisdiction. Why? Because the most recent Comprehensive Error Rate Testing (CERT) report for 2022 shows SNFs with the highest improper payment rate of all health care providers – 15.1% or $5.8 billion – about 18% of all improper payments. The hospital outpatient setting was next with an improper payment rate of 5.4% and roughly 14% of overall improper payments. Hospice had a 12% error rate but makes up less than 10% of overall errors with home health at 10.2% and roughly 5% of the overall.  

Specifically, CERT program for SNFs projected an improper payment rate of 15.1% in 2022, up from 7.79% in 2021. Insufficient documentation was the leading reason. Part of the reason for the significant increase in the improper payment rate may be the change from the Resource Utilization Group (RUG) IV to the PDPM (patient driven payment model) for claims with dates of service on or after October 1, 2019.

Are you confident in your documentation? Want a second set of eyes to review your claims before the MAC does? This is a key time to reach out to CLA.

To increase comprehension of correct billing practices under the PDPM by all SNF providers that bill Medicare, CMS is implementing a 5-claim probe and educate medical review strategy as follows:

• All MACs that review SNF Medicare claims
• MACs will select 5 claims from each selected provider
• MACs will complete one round of probe and educate for each selected provider instead of the potential three rounds under the traditional probe and educate approach.
• Education offered will be individualized based on the claim review errors identified in the probe
• MACs are mandated to implement the SNF 5-claim reviews on a rolling basis beginning with the top 20% of providers that show highest risk based on MAC data analysis.
• MACs will generally do so under prepayment review.

Other Provider Error Rates

While others may not be subject to the probe and educate review as SNFs are, they should also review the CERT report to understand areas for improvement. The report provides information on root cause of the errors found in:

• Hospital outpatient department
• Hospice
• Home health
• Part B – labs, office visits, specialists
• DEMPOS – CPAP, lower limb orthoses, infusion pumps and related drugs
• Hospital inpatient – hip and knee joints (469, 470), Endovascular Cardiac Valve Replacement & Supplement Procedures (266, 267) and Percutaneous Intracardiac Procedures (273, 274).

How we can help

For many SNFs, this may be the first experience with a MAC audit. It’s not a matter of if this will happen, but when you’ll receive the audit request. We can assist you now by doing a targeted review. We pull a 5-record sample of your Medicare Part A claims and look for the same items the MAC will look for – HIPPS code validation, appropriate documentation, physician certification and recertifications, and medical necessity. We can also review your triple check process so you can validate your own claims going forward. 

For everyone else, insufficient documentation is the leading reason for improper payment errors followed by medical necessity and incorrect coding. Make sure you revisit your process, check and re-check and do mock audits or coding reviews. We can help. Reach out today.