Providers Struggle with PECOS: ‘We Have Zero Control’

ATLANTA — Jan. 4, 2010, is suddenly a very scary date for HME providers. That’s when Medicare will stop paying claims unless the referring physician is registered in the Medicare Provider Enrollment, Chain and Ownership System (PECOS). Problem is, many physicians are not registered and have little incentive to do so: They will continue to get paid by Medicare whether they are in the PECOS system or not.

The dilemma has surfaced as providers have begun to receive CEDI warnings on claims processed on or after Oct. 5 that would not pass muster come January. HME companies across the country report a large percentage of claims are currently getting such warnings, and they are realizing the onus is on them to convince their referring doctors to sign up in PECOS.

“I have heard from members who have 100 percent warnings on their claims,” said Rose Schafhauser, executive director of the seven-state Midwest Association for Medical Equipment Services. “Many are 80 percent.”

“As we approach doctors, most of them don’t know about this or they don’t think it applies to them,” said Terry Flatt, executive vice president of Hammer Medical, Des Moines, Iowa, which has 93 employees working in eight locations. “Physicians aren’t aware of what to do and won’t be impacted if they don’t do anything. The [PECOS] database is not accurate, and there is a two-month lag before information shows up. We are going to run out of time before the Jan. 4 deadline. The fear of our industry is that, come Jan. 4, whether it’s the doctor, the database or CMS, claims will stop being paid, and we have zero control.”

After doctors or other eligible referrers register in the online PECOS system, they submit a signed statement to their Medicare contractor certifying that the details they submitted in PECOS are true. The Medicare contractor then links the signed certification to the Web-based submission. If there is missing or incorrect information, the delay could take 60 days or longer.

Flatt said Hammer Medical has created a spreadsheet to analyze the extent of the problem. The provider recently received warnings with about 80 percent of claims, and the strategy is to approach larger physician groups first in order to have the most impact with the least effort. “We are being very proactive in educating our physicians,” he said.

“It’s very wrong,” said Flatt. “We could be the ones not getting paid for service, and we don’t have any control. It’s very dysfunctional. We have considerable time and expense invested, and we are taking a proactive approach to protect our future. We have spent hundreds of man-hours and continue to do so educating the physicians and our referral sources. It is an area we have to address. We are running out of time.”

Many MAMES members have pulled billing staff off their regular duties to put them on the PECOS issue, said Schafhauser. MAMES is providing a “cheat sheet” to members on what they need to do to educate physicians, she said, but she wonders why the burden should fall on HME providers.

“What’s unfair to them is when the physician’s office says ‘why are you bugging us about this?’ We are being put in the middle,” Schafhauser said. “We are a small part of the Medicare budget, but we are having to turn into police officers.” The bottom-line cost of dealing with the problem is hard for members to wrap their arms around, Schafhauser added. “It involves staffing resources many companies don’t have at this time.”

Schafhauser said one encouraging aspect is that the problem related to PECOS registration will also surface when, for example, a general practitioner refers a patient to a medical specialist; paying the specialist’s claim will also require the general practitioner to be listed in PECOS. “I’m not sure why the [specialist] physicians’ offices aren’t screaming about it,” said Schafhauser. “Maybe they are and we’re just not hearing about it.”

“I don’t know how you deal with the impact it will have on the customer,” said Mary Rogers, billing manager of Jim’s Home Health Supplies, Lincoln, Neb. “What do we tell a customer who comes in and needs something and their referring physician is not authorized to order it [and get it paid for by Medicare]? It’s an industry-wide dilemma we are all going to have. The chances of getting 100 percent of physicians [in the system] is nil. It’s not going to happen.”

Jim’s serves a 50-mile radius around Lincoln, including many physicians in smaller communities. Educating them to the problem “will be very time-consuming,” said Rogers.

Rogers noted that Jim’s was originally receiving warnings on 100 percent of its claims until it adjusted its internal system to report the doctor’s name in all caps as required. Since then, warnings have been lowered to about 78 percent, she said.

The company is still investigating the problem and has compiled lists of doctors in various specialties from the PECOS database to compare with the company’s own directories. “We’re finding that, for example, one of our large internal medicine practices didn’t have any physicians listed. We looked up the urology specialty and found only one urologist listed [in our area], but we have 18 urology physicians in our directory,” Rogers said.

“We polled about 100 doctors last week and only one had even heard of it,” said Chris Rice, director of marketing, Diamond Respiratory Care, Riverside, Calif., whose market includes about 2,500 physicians covering much of southern California.

Diamond Respiratory plans a marketing campaign to let doctors know about the program, including a pamphlet that covers how doctors should register. The provider also plans to enclose inserts with mailings. In cases when Diamond receives a warning, the company is faxing the specific doctor to explain the problem.

“They’re telling us this is how it’s going to be, so we have 60 days to get a whole lot of doctors into the system,” Rice said. “We have to take some kind of action.”

Added Rice, “I think [CMS] should delay it until we can make sure the doctors are in the system, and in the interim they should educate the doctors.”

“[PECOS] has turned into the No. 1 issue right now for providers,” said Schafhauser.

View MLN Matters Article MM6421 on the PECOS.

Free PECOS Extractor Tool

In an effort to simplify the identification of physicians not enrolled in the PECOS, ClaraVista has created software that parses the warning information from GenResponse reports for electronically filed claims. The PECOS Warning Extractor, or PWE, creates a work list in a .csv file format that can be accessed through Notepad or Excel, sorted, analyzed and distributed to staff members so they can contact physicians about enrolling in PECOS before Jan. 4, 2010.

“The PWE is not stunning; it will not make a programmer’s heart go pitter-patter,” said ClaraVista’s Derrick Stark. “We designed it to be simple to use so our clients could get their physician education initiatives off the ground quickly. Given the implications of not getting a jump on PECOS, we are making it available to all providers without charge.”

To download the PWE tool, go to www.starkvistagroup.com.

You can view a video tutorial on its use.

For questions, contact ClaraVista at [email protected] or 803/253-8796, ext. 200.