Save The Date: 2010 TOA Socioeconomic Summit

By John Early, MD
President, Texas Orthopaedic Association

TOA's original Practice Management Course
for orthopaedic residents

Featured Legislator: Congressman Ted Poe (2nd District of TX)

your message to Congress. Most of the Texas Congressmen met with our orthopaedic delegation in person, sometimes for extended periods of time. We want to thank each legislator and their staff for spending time with us in an effort to make sure we get reforms right for our patients and our practices.

January 2009, Congressman Ted Poe was sworn in to serve a third term representing the 2nd Congressional District of Texas in the United States House of Representatives. Before serving the 2nd Congressional District, Congressman Poe was a prosecutor and judge for 30 years in Houston, Texas where he garnered national media attention for his "Poetic Justice" punishments.

Congressman Poe has taken leadership roles in Washington, DC to advocate for Texas residents and their concern with the healthcare reform as he clearly understands physician issues and the challenges to physicians posed by federal and private health care programs.

Today, Congressman Poe brings that same no-nonsense style to Congress. As a member of the House Judiciary Committee, he is able to offer his unique perspective and professional experience to the committee membership. As a newly elected Congressman, Poe visited our troops and military leaders on the ground stationed overseas as he serves on the House Committee on Foreign Affairs.

Click here to obtain his contact information.

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This Week In Texas: Mignon McGarry's Memos

Wednesday, October 21, 2009

Sen. Eliot Shapleigh (D-El Paso) announced Friday that he will not seek re-election to his Senate District 29 seat.  Shapleigh, who has

served in the Texas Senate for the past 12 years, did not rule out a run for higher office.  Rep. Joe Pickett (D-El Paso) has said that he considering running for the Senate seat but will instead continue his race to hold his House seat.  Other rumored candidates include Rep. Norma Chavez (D-El Paso) and El Paso County Attorney Jose Rodriguez.

Republican Dan Neil, a former offensive lineman for The University of Texas and former Denver Bronco, announced he will run for House District 48.  Rep. Donna Howard (D-Austin) currently represents House District 48.

Hopkins County Republican Party Chairman Erwin Cain announced that he will run against Rep. Mark Homer (D-Paris) for the House District 3 seat.

Republican James Bernsen, one of the announced candidates for House District 52, suspended his campaign and announced his support of Round Rock businessman Larry Gonzales for the Republican nomination.  House District 52 is currently represented by Rep. Diana Maldonado (D-Round Rock).

Recovery Audit Contractors – An Alert for All Texas Orthopaedic Surgeons

Patrick M. Palmer, MD, San Antonio, Texas
American Academy of Orthopaedic Surgeons, Board of Councilors

The Medicare Modernization Act of 2003 directed a three-year demonstration program using Recovery Audit Contractors (RAC) to detect and correct improper payments by the Center of Medicare and Medicaid Services (CMS). This program began in 2005 and included New York, Massachusetts, Florida, South Carolina, California and

Arizona as the pilot project.

The Tax Relief and Health Care Act of 2006 made the RAC program a permanent part of America's CMS oversight. RAC demonstrations have been highly "cost-effective" according to CMS in protecting the Medicare Trust Fund. CMS has directed a nationwide expansion to all states as soon as possible. The RAC program will begin in Texas on January 1, 2010. This program is likely significantly impact to Texas physicians.

RAC Experience

• The CMS cost to collect $1 of Medicare overpayment is 20% payable to the RACs through contingency fee

• In a three-year demonstration ending in 2008 the RACs collected over $993 million in overpayments to providers, or 96%
• RACs repaid $38 million in underpayments, or 4%
• Hospital overpayments were 84%. Physician overpayments were 2.5%
• RACs work on a contingency-fee basis
• Of $993 million of overpayments collected approximately $20 million was collected from physicians
• Coding errors are the most common violations for physicians
• There is an appeals process but overpayments were overturned only 4.7% on appeal as opposed to over 95% of the appeals which were stayed

RAC Violations

The American Academy of Professional Coders (AAPC) in August 2009 presented "Prepare for Recovery Audits, Protect Your Practice". This resource is helpful in determining the scope of the RAC audits.

Minor Problems:

• Education of provider on appropriate billing procedure

• Collection of overpayments
• Further analysis at later date

Moderate Problems:

• Education of provider
• Collection of overpayments
• Initiation of pre-payment review until corrected

Major Problems:

• Education of provider
• Collection of overpayments
• Initiation of high level of pre-payment review
• Payment suspension
• Referral to CMS Fraud Department

Repercussions for physicians will vary depending on the scope of the audit and errors uncovered. RACs look for physician E&M outliers and physicians coding a large number of office consultations. The RACs will use "data mining". Medicare uses their data bank to generate physician profiles. Outliers may be sent a notice in writing and should begin an internal review of their office coding practices. Outliers may be sent for RAC audit.

A RAC audit begins with a letter notification:

• Coding or payment violation
• Reason for the review
• Description of the overpayment
• Recommended corrective actions
• Explanation of physician's right to submit rebuttal statement
• Explanation of procedures to recover overpayments
• Notification of the physician's right to request extended repayment schedule
• Information on the physician's right to appeal

The RAC records request is detailed:

• Linked to the National Provider Identification Number
• Record limit for solo-providers is 10 records per 45-day period
• Record limit for small groups of physicians (2-5) is 20 records per 45-day period
• There will be no RAC audits on Medicare claims filed before October 1, 2007
• Responding To a RAC Audit

The American Academy of Professional Coders (AAPC) has provided some important recommendations to physicians involved in a RAC audit:

• Send in all documentation
• Do not alter records
• Send records to RAC auditor promptly, 30-day requirement
• Identify the reason for the audit
• Send a cover letter describing your practice, your credentials and detailed information about each patient's condition, procedure and ongoing care
• Send all documents by certified mail return receipt requested

Diminish the Risk of a RAC Audit to Your Practice

• Benchmark your practice to compare your E & M and consultation codes against national and state norms
• Analyze your E&M and consultation code distribution
• Identify risk areas in billing practices
• Code accurately and submit a thorough dictation on a timely basis to minimize recoupment audits
   

Summary of Medicare RAC Audits

• RACs are now a permanent part of CMS medical practice oversight
• Physicians who regularly see Medicare patients are at increased risk of a RAC audit
• RAC audits will begin in Texas on January 1, 2010
• Appeal of RAC overpayment demands are rarely successful (4.7%)
• Do not be an E&M or consulting code outlier
• Coding errors are the most common physician violation
• Most physician violations will likely be minor and will result in the collection of the overpayment and further CMS oversight
• Some major violations may result in suspension of Medicare payments and possible federal charges of Medicare fraud

References:

1. Conde, Crystal. "Getting Ready For RACs." Texas Medicine Aug. 2009: 49-53. Print.
2. Connolly Healthcare. "CMS RAC Program Information." Web.
3. LeGrand, Mary. "Are You an E&M Outlier?" AAOS Now Aug. 2009: 29. Print.
4. Wachler, Andrew B. "Recovery Audit Contractors and Medicare Audits: Successful Strategies for Defending Audits." Caring Nov. 2008: 36-36. Print.