Pre-Payment Reviews Continue, Point Up Huge Denial Rates

COLUMBIA, S.C.–HME providers in Jurisdictions A and B have been
slammed with claim denials in a number of areas this year,
according to the results of several pre-payment reviews released by
TriCenturion, the regions’ DME PSC.

Most of the denials, according to the results, were due to
inadequate, incomplete or improper documentation.

“Providers really need to pay attention to the guidelines that
Medicare sets forth and abide by them,” said Lisa Bargmann of
Bargmann Management and Homecare Collection Service in Akron, Ohio.
“Many providers are looking for easy answers to avoid the Medicare
requirements; however, there are not any.”

The reviews are part of a stepped-up effort by CMS to curtail
reimbursement for unnecessary items and to combat fraud and abuse.
Through its contractors, CMS has been scrutinizing claims for
various products, a practice that is expected to continue and
perhaps even escalate.

As a result of the intensified scrutiny, claim denials have
soared, to as much as 93.6 percent for some power wheelchairs in
Jurisdiction B and 99.25 percent for surgical dressings in
Jurisdiction A.

“Denial rates have increased because there is a more
concentrated effort on saving costs, especially when Medicare views
that services are being provided that are not warranted under their
guidelines,” Bargmann said. “I expect those denials and audits to
continue at a high amount.”

Bargmann said providers can help guard against denials by making
sure the patient qualifies for the equipment and having proof on
file.

“Just because Medicare doesn’t require you to send in the proof
up front does not make it OK not to have the information,” she
said. “Each time a provider bills for a service that has not been
qualified, that creates an opportunity for a take-back on not only
that patient but an extrapolation across all patients. It also puts
the provider number in jeopardy, along with additional fines and
punishments.”

Following are the results of TriCenturion’s recent reviews:

—Power Wheelchairs HCPCS K0823.The Charge
Denial Rate was 87.5 percent for Jurisdiction A and 93.6 percent
for Jurisdiction B. This pre-payment review will continue.

—Negative Pressure Wound Therapy HCPCS E2402.
This review was continued in Jurisdiction B as the result of an
overall 83.72 percent CDR in a 2006 probe of new products added in
the policy group. While results for the third quarter showed 25
percent of the claims were paid, 63 percent were denied because
policy criteria were not met, and another 12 percent were denied
for non-response. This pre-payment review will continue.

—Surgical Dressings HCPCS A6209-A6214. The CDR
was 99.25 percent for Jurisdiction A and 98.77 percent for
Jurisdiction B. This pre-payment review, which has been completed,
showed that 71 percent of the claims were denied because medical
necessity was not supported.

—Heat/Cold Application HCPCS E0215 (electric heat pad,
moist) and E0217 (water-circulating heat pad with pump).
The CDR was 84.38 percent for Jurisdiction A and 92.43 percent for
Jurisdiction B. The review, which is complete, showed that in
Jurisdiction A, 30 percent of the claims were denied as not
medically necessary because the information submitted did not
demonstrate that policy criteria were met. In Jurisdiction B, 59
percent of the claims were denied for the same reason.

—Rollabout Chair HCPCS E1035. This review,
which has been completed, was conducted in Jurisdiction B. The CDR
was 29.2 percent, with most claims being denied because they were
deemed not medically necessary.