CMS admits RAC got it wrong

Thursday, March 3, 2011

FARGO, N.D. - CMS plans to halt automated CPAP audits in Jurisdiction D after learning that its contractor has misinterpreted Medicare policy, AAHomecare reported last week.

Medicare policy requires an approved sleep test for CPAP and supplies. HDI, the recovery audit contractor (RAC) for Noridian Administrative Services, the Jurisdiction D DME MAC, interpreted that to mean that Medicare must pay for the test.

In reality, "it doesn't matter who pays for the sleep test," said Kelly Riley, director of The MED Group's National Respiratory Network, and a member of AAHomecare's CPAP Task Force.

HDI was demanding recoupment on claims where Medicare didn't pay for the sleep test.

The RAC audits have been a big headache for providers. In some cases, the patient's sleep test was no longer part of the Medicare common working file, which generally gets purged after five years. So it was up to providers to prove that the test was actually done, and that it was paid for by Medicare, which may or may not have been the case.

"It's been a nightmare," said Sheila Roberson, office manager for Lawrence, Kan.-based Criticare Home Health Services and chair of the Jurisdiction D DMERC Advisory Committee.

CMS has indicated refunds are possible if money was wrongly collected, according to AAHomecare.

Meanwhile, until CMS issues some guidance on the issue, providers are unsure what to do with pending appeals.

"Do we continue to appeal the (recoupment demands) we've already gotten?" asked Roberson. "Do we disregard? I appealed all mine just to be safe."

A different problem that the audits did uncover: Some providers are erroneously billing for headgear every three months, instead of every six months as allowed by Medicare.

"I think the providers truly overlooked that," said Troy Paz, general manager of Pocatello, Idaho-based Maag Medical. "You really have to go in and audit yourself. With Medicare constantly changing its regulations, its tough to keep up."

Roberson said many of the supply claims should never have been paid to begin with.

"Why wasn't the edit in place at the contractor in the first place?" she said.