Administrative Memos

200509

FROM: Theodore O. Will, Chief Executive Officer
DATE: Nov 16, 2005
SUBJECT: Medicare Technical Denials Resulting in Payment Errors
IPRO CONTACTS:

Kathy Terry, Ph.D., Senior Director, Data Analysis & Evaluation, Medicare/Federal Health Care Assessment, 516-209-5226

As you are aware, the Medicare Hospital Payment Monitoring Program (HPMP) includes review/abstraction of medical records. These review results comprise the national and state payment error rate, which is monitored on an ongoing basis by the Centers for Medicare and Medicaid Services (CMS). The Clinical Data Abstraction Center (CDAC) requests the medical records from the hospitals. The hospitals must provide these medical records to the CDAC (Computer Sciences Corporation (CSC) DynKePRO) within thirty (30) days of the date of request, i.e., the "due date." When a medical record is not received at the CDAC within the thirty (30) day timeframe, a technical denial must be issued by IPRO. The technical denial notice alerts the Fiscal Intermediary (F.I.) to recover payment from the hospital based solely on the fact that the medical record was not provided for review.

Technical denials are considered payment errors because payment has been made for care that cannot be substantiated, i.e., lack of medical record documentation. Compliance with the request for medical records (i.e., from the CDAC and/or IPRO) in a timely manner is in the hospital's best interest to avoid both lost reimbursements and a high CMS payment error rate.

Several actions have been initiated by IPRO over the last few years to remind hospitals of the technical denial process and to encourage timely submission of requested medical records. These actions have included administrative memoranda, written correspondence, distribution of hospital-specific lists of cases that resulted in technical denials, and follow-up telephone calls to outlier hospitals.

Unfortunately, many hospitals in New York continue to receive technical denials. These technical denials are a contributing factor in the increasing payment error rate for NYS. Currently our error rate has risen to nearly 7%, necessitating more aggressive actions to eliminate these errors. Therefore, IPRO will continue to monitor all technical denials on a quarterly basis. Hospitals that fail to submit records in a timely fashion will be asked to submit a process improvement plan (PIP) that will include, at a minimum the steps to be taken by the hospital to identify the root cause of the untimely submission of medical records and the action(s) that will be taken to improve the hospital's medical record submission process.

If your hospital currently has technical denials for the HPMP/CDAC sample, a case list has been uploaded to QualityNet Exchange. A separate e-mail notification of this upload was sent to the IPRO and HPMP Liaisons. Please review this list and submit these medical records to IPRO as soon as possible. Affix a copy of IPRO's technical denial notice that was previously sent to your hospital for the corresponding cases. If this notice cannot be located, use this memorandum and/or a copy of the case list and affix to each medical record. If you have already submitted a medical record to reopen a Technical Denial, DO NOT RESUBMIT.

Your cooperation is appreciated in addressing this issue. If you have any questions or comments about this memo, please contact Dr. Kathy Terry, Sr. Director, Data Analysis & Evaluation, Medicare/Federal Health Care Assessment at 516-209-5226.