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CMS’ Newest Pre-Claim Review Initiatives

Re-Branded & Slightly Revamped, CMS Pre-Claim Review Moves Closer to Implementation


In 2016, in an effort to eradicate improper billing practices that seemed to pop up in agencies across the nation, CMS (The Centers for Medicare & Medicaid Services) announced the implementation of the unpopular and highly criticized “pre-claim review demonstration” in the state of Illinois. In a nutshell, this initiative would require home health & home care providers to submit claims at a much earlier point within the care process. After a series of resounding objections from many within the industry and with some assistance from congressional leaders weary of pressure from their constituents, major stakeholders were able to quell the efforts to implement pre-claim review initially.

Time passed, tweaks were made, and CMS in a move that was somewhat unexpected revived the initiative over the summer. Industry insiders now suggest that the previously successful coalition of forces that were able to derail it the first time around, won’t be able to defeat the newer, reinvigorated rendition of pre-claim review.

NAHC (National Association of Home Care & Hospice) leadership has publicly stated they do not believe they will have a great deal of success fighting or postponing the implementation this time around. The subject was a hot topic of discussion at the NAHC annual leadership conference which was held in Texas this year. Officials and agency leadership are sounding the alarm that Pre-Claim Review implementation is now being seen as policy inevitability.

The new version of the much maligned policy (which has been rebranded by CMS as “The Review Choice Demonstration) would allow home health agencies to usurp prior claims authorization in favor of post-payment review. Within post-payment review, providers can affirm claims after payments have already been received, providing CMS with the opportunity to rescind funds if problems are identified after the fact.

Additionally, the newer proposal allows home health care agencies and other providers to opt out of previous as well as post-payment review, and as an alternative accept a 25% reduction on total payments for claims set for submission. Any providers that meet a pre-approved claim approvals rate have the choice  to opt out of claim reviews and allow a periodic spot check to guarantee continuous compliance.

This most current rendition of  “The Review Choice Demonstration” (Pre-Claim Review by another name) is proposed to go into effect in the state of Illinois on Dec. 10, 2018. Just as before, current stakeholders can provide commentary and feedback on this initiative within the standard 30-day comments window that will close at the end of the month.

Previously, a meticulously detailed report this past April from the GAO (Government Accountability Office) that outlined the potential savings which would be generated by the original 2016 Pre-Claim Review initiative hampered the efforts of critics of the program. The report suggested a savings as high as 1.9 billion dollars within the first year alone.

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Obviously massive savings within the Medicare program is looked upon favorably by CMS and other entities. The program’s consistent critics are skeptical, in that their feeling is that the new tweaks made to the program fail to address much of the insight and suggestions collected during the resistance to the original version. The perception as well as some of the data of detractors indicates that smaller sized agencies will bear the brunt of the inconvenience and regulatory hassle that the program presents.

Some critics have pointed out that CMS officials never took the time to analyze the feedback & data they received for Pre-Claim Review. Officials from the NAHC still are planning to push back on the newer version, citing that there are reasonable alternatives already in existence that cost less, and can be more effective. The only generally positive aspect of the program which seems to be agreed upon, is that providers who routinely hit the targeted % of properly submitted claims, would be able to skip post or pre-claim review, moving directly into the spot checking optional provision. In other words, if upon initial analysis, an agency demonstrates that 90% or more of their claims were successful under the rules, then they would not necessarily have to go through a full 100% review going forward.

The stakes for this are high, as while Illinois is the first institution state for the new pre-claim review version, Texas, Ohio and North Carolina are up next. The fact is that improperly billed payments statistics continue to increase. With that in mind, CMS will push to implement its new version of pre-claim review as soon as possible, in as many states as possible even if it is not ideal from a regulatory burden standpoint on certain types of agencies.

In the meantime, a coalition of nearly 30 current members of Congress sent a letter to CMS Administration last month requesting additional clarification on Pre-Claim Review, and expressing concerns on whether or not the revamped rendition was the best solution.

We will continue to share the latest developments on implementation in Illinois and subsequent states in the Alora Homecare blog.

For more information on this topic or on Home Health Software technology, email us at Info@Alorahealth.com

The Alora Home Health Blog

Read the Alora blog to learn more about the Home Care Software industry, including recent news, articles and commentaries, as well as other issues that pertain to Homecare in the U.S and beyond. For more information on our blog, or for questions or feedback, please send us an email to homehealthsoftware@alorahealth.com

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