Healthcare has become one of the most highly regulated industries in the county and maintaining regulatory compliance has a permanent spot on top of the to-do list. The role of HR staff is unique in that it is not only a large source of risk, but the HR personnel can also play an integral part in the risk management of a business if properly supported. Achieving and maintaining HR compliance can be elusive goals for an organization that does not recognize the critical HR-specific risk exposure areas that exist and develop a strategy to minimize them.

1. Background Checks. Hospitals, medical practices and other healthcare providers must perform thorough background checks on prospective employees. Since healthcare employees are entrusted with the care of patients and with sensitive information, hiring organizations are most concerned about those who misrepresent themselves or use drugs.
2. Certifications. Healthcare organizations should have the proper tools to track certifications, as medical professionals have continuing education credits they must renew every year. To reduce risk and liability, it’s crucial to have a reliable and consistent system to track and report on each employee’s certifications and license expiration dates.
3. Education and Training. Workplace education and training is important in all organizations, but arguably the most important in the healthcare industry. The HIPAA law to protect patient health information is one of the most well-known, for instance. There remains, however, confusion regarding HIPAA’s rules and regulations. Employees disclosing PHI, medical records mishandling, social media, and lost or stolen devices are just a few of the most lucrative violations for Health and Human Services (HHS) Office for Civil Rights (OCR) to collect on. In fact, in 2017 alone, OCR imposed $19,393,000 in fines from covered entities and business associates to resolve HIPAA violations.
4. High Turnover Rates. High turnover stems from several causes: According to healthcare management firm Leaders for Today, 58% of respondents left their current position for reasons including long work hours, frustration, burnout and a lack of training and development. Regardless of the cause, even a 30-day gap in the wake of a departing HR employee leaves a business open to an enormous amount of exposure.
5. Regulatory Compliance Nuances. While HIPAA will always be a hot button issue, the HR function is a key player within an organization’s compliance structure and also manages various other heavily regulated initiatives. Staff lack a resource for staying informed risk potential violations that could not only damage a practice’s reputation but cause criminal and civil fines.

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As many home health providers are aware, four or less skilled nursing visits are reimbursed a standardized per-visit payment based on the type of visit billed instead of the standard 60-day episodic payment.  These payments are known as Low Utilization Payment Adjustments (LUPAs) and they’re on the OIG’s radar, (see their June 2018 workplan).  Planned for fiscal year 2019, the Office of Inspector General will be reviewing claims submitted to CMS with 5 or more visits to ensure that they should not have been billed as a LUPA. The OIG has not reviewed LUPA payments in the past so providers and case managers have a very narrow 6-month window to review charts, review billing, and prepare.

Though some LUPAs cannot be avoided understanding why LUPAs occur may help in reducing them in future episodes. Examples of inevitable LUPAs include instances where a patient is transferred to Hospice, readmitted to the hospital before a Plan of Care is complete, or a patient is recertified but attains their goals within the following four visits. Other than making sure the Hospice transfer or hospital readmission happens after the 5^th visit, there’s not much an agency can do to prevent a LUPA of this sort. 

Certain diagnoses can pull also the LUPA trigger. A seasoned case manager should be able to recognize the LUPA potential on things like B12 shots, catheter changes and mental health patients. Additionally, the industry wide challenge of missing visits is not only an operational challenge but a LUPA magnet as well.

To prepare for this new OIG initiative, providers should begin reviewing supporting documentation with the following tips in mind:

1. Verify all scheduled visits were completed and correctly documented
2. Conditions of coverage were supported
3. Remainder of the episode is appropriately scheduled
4. Develop a consistent strategy for periodic chart and utilization reviews

As with other OIG enforcement, the likely consequences of an adverse finding when an agency billed between 5 and 10 visits but should have billed 4 or less (LUPA) include financial offset (reduction) of future reimbursement, clearing house recoupment, state and accrediting agency survey or worse.

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“Medicare Paid Hundreds of Millions in Electronic Health Record Incentive Payments to Noncompliant Eligible Professionals.” 

And…CMS looks forward to receiving referral files, will review them, take appropriate steps, and recoup medical payments in accordance with the its policies and procedures.  This statement specifically speaks to the OIG’s determination that $2,334,680 in overpayments were made to eligible professionals (EPs) that switched their Medicare/Medicaid (incentive) program midstream while reporting meaningful use measures that were made and paid in the wrong payment year.

The OIG and CMS are not limiting overpayment recoupment efforts to only those EPs described above, it is estimated that 12% or $729,424,395 in payments to providers that collected meaningful use incentive payments were overall improper payments and the government wants the money returned.  A random sample size of 100 EPs was conducted where it was found that 14 EPs received $291,222 for improper payments made by CMS due to the EPs not maintaining support for their required attestations.  CMS’ response is that they will work with its contractor to recoup any overpayments.

Meaningful Use required that EPs demonstrated that they are using certified EHR technology that includes electronic prescribing, electronic exchange of health information for care coordination, 50% of the EP’s encounters during the reporting period were performed in a location that utilized certified EHR technology, and that a security risk analysis with identified and implemented corrections occurred.  Did these things happen and were they reported correctly in your organization?

Because these incentive payments to EPs legally authorized to practice medicine and maintain an active NPI number, an NPI number must be deactivated within 60 days of the death of the provider.  The OIG found that CMS paid $11,760 to an EP (not part of the sample) that died during the reporting period.  Further, included in their sample, it was revealed that 11 deceased EPs were not deactivated within the 60-day timeframe and 2 of the deceased were still active in the identification and payment systems as of the date of this report (June 2017).

Targeted risk-based audits to strengthen CMS’ program integrity began in 2017 and are expected to continue until millions of dollars have been repaid or recouped.  Since CMS made EHR incentive payments to noncompliant eligible professionals and it has vowed to recoup the money, it’s more than time to verify the data reported, attestations submitted, conduct a security risk analysis, and make and document appropriate corrections.  Meaningful use documentation is to be retained for 6 years, so if you think you or your staff may have missed anything in completing and reporting incentivized quality measures, assess your business and make corrections now rather than later.

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There is no such thing as a riskless healthcare business purchase, but it’s appalling that the due diligence standard for healthcare business purchasers is often limited to an intensive of company financials.  Such a limited focus will miss critical issues like—

• Structuring a transaction to ensure cash flow;
• Clearing unique state-based licensure hurdles that must be cleared before closing the transaction;
• A detailed view of the regulatory viability of current receivables;
• Healthcare regulatory risks associated with the business model to be purchased; and
• The long term viability and regulatory horizon of the type of business being purchased

The biggest problem healthcare business buyers have is a lack of certainty.  Unless the buyer has been intimately involved in healthcare operations and in regular contact with healthcare legal counsel, they are not likely to be fully aware of the business and regulatory risks.  Even more, healthcare is a very local phenomenon.  What’s happening with surgery centers, addiction treatment or medical practices in South Florida is very different than what’s happening with them in North Florida.

As such, any meaningful due diligence of a business in the healthcare sector should include—

• Vetting the transaction structure with healthcare legal counsel;
• Knowing all the state and federal laws that affect the structure and timing of the transaction;
• A deep view of whether receivables are collectible or are vulnerable to denial and clawback;
• The long range view of the industry (and geography) in which the business arises.

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• A purchaser bought a healthcare company, was ready to launch operations right after closing the $5M transaction.  The problem was that the buyer needed a certain state license specific to Florida that wasn’t apparent to their corporate lawyers.  This caused the buyer to have to wait for nearly 90 days to operate the business, while still paying all operating expenses!
• A client in the midst of an acquisition retained us after obtaining fully signed purchase agreements, only to find the transaction close date was required under Florida law to be pushed back.  The net effect was that the delay became a negotiation point costing the seller hundreds of thousands of dollars.
• Corporate purchaser of a medical practice completed their asset purchase with the expectation that the bulk of the income stream be preserved by the assignment of certain contracts.  After the transaction closed, they learned the agreements could not be assigned, even though the contracts stated they were assignable upon agreement of the parties.  It took the buyer roughly six months to restore the contracts and impaired the income stream by about 50% for twelve months.  It took the buyer 12 months post transaction to restore the income stream they expected and needed 12 months earlier.
• Purchaser of an healthcare facility based the purchase on the prior 24 month financials, but failed to ascertain (1) most of the accounts receivable were older than the underlying contracts allowed, and (2) the claims in progress did not adequately document medical necessity, resulting in a huge payer clawback.
• A corporate healthcare business buyer was not aware of its liability to governmental programs in a stock purchase transaction.  When a large Medicare claim was made and the new owner pointed the finger at the prior owner, they were unable to avoid repaying Medicare, and the signed transaction documents failed to (a) specifically address responsibility for this common healthcare transactional risk, or (b) reserve a sufficient amount of the purchase price to prefund such risks.

Knowing the numbers is one thing.  Knowing the regulatory risks is something very different!

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An additional $13M in revenue

1. The first is consistently identified as incomplete or inaccurate documentation.  As we well know, improper code assignment has a huge effect on claims processing so it is imperative that clinicians’ documentation is as accurate and thorough as possible.  The latest electronic health software scrubs information and provides indicators regarding deficiencies, and if detected early enough, leads to better care, coding and appropriate reimbursement.
2. Always pulled in different directions and spread thin, physician query fatigue has also be identified as having a negative effect on CDI.  Improved EMR workflow can help physicians answer inquiries in a single platform making more efficient use of their time.
3. Closing communication gaps between CDI Specialists, auditors and coders help to resolve issues quickly, avoid discrepancies, denied claims and re-billing.  Productivity can be improved by implementing a workflow that prioritizes the most valuable cases first with the easiest last.
4. Choosing and using the right CDI Specialist or technology reduces problems with coding, billing, and reimbursement while improving continuity of care and patient outcomes.

RiskShield Tools offers on-site CDI workshops as a service to our clients for compliant, improved patient care and revenue cycle.

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