aaham presentation
TRANSCRIPT
8/6/2019 AAHAM Presentation
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Preparing for RAC ?Strengthen Your Denials Management Process
December 19, 2008
Practical, Innovative, Medical Management Solutions
8/6/2019 AAHAM Presentation
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PREPARING FOR “RAC ATTACK ”
GoalDevelop a proactive attack plan to prevent
financial risk for the organization
Assemble a RAC Taskforce
Interdisciplinary approach with core players:
• Utilization Review
• Medical Records
• Risk and Outcomes Director
• Patient Financial Services Director
• Information Technology Representative
• Physician Representative (in-house or contracted)
8/6/2019 AAHAM Presentation
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PREPARING FOR “RAC ATTACK”
Determining the Action Plan
• Establish line of authority for hospital wide RAC program
• Use existing data to analyze/identify denial drivers
• Perform in-house audits and determine hospital wide and
system weaknesses
• Establish process improvement plans
• Develop an interdepartmental tracking system
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PREPARING FOR “RAC ATTACK ”
In-House Physician Advisors
PROS
• Decrease hospital expense
• No contingency fees
• Existing internal peer relationships
CONS
• Increases existing physicians work load
• Physician often not be specialized in denials management
• Difficulty persuading others to embrace practice improvements
• Limited ability to produce valuable educational reports and denial tracking reports
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PREPARING FOR “RAC ATTACK ”
Results Achieved: Denials Outsourcing
FYE 2005 - 29.54% of Total Cost denied
- 21.00% overturned after in-house appeal
FYE 2006 - 27.53% of Total Cost denied
- 44.90% recovered utilizing physician appeal
Summary
Significant Denials Decrease:
- 19.50% is the average recovery prior to programlaunch
- 29.00% is the sustained recoveries since 2006
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PREPARING FOR “RAC ATTACK”
Demonstration Project RAC Statistics
• 32% medical necessity denials
• 42% incorrect coding denials
• 9% insufficient clinical• 88% inpatient
• 11% appealed
• 5% overturned
• 42% of hospitals had no denials issued
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PREPARING FOR “RAC ATTACK”
• Denials Increasing from Numerous Sources
• CMS Denials
• RAC Denials
• Emergence of Medicare “Never Events” Denials
• Increased Denials
• Medicaid MCO’s• FFS Medicaid
• Commercial Payors
• Use RAC Preparations as Catalyst to Revamp your DenialsManagement Process
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PREPARING FOR “RAC ATTACK”
Key Components of an Effective Denials Strategy
Primary Strategy - Proactive Prevention
• Use data to identify key drivers of denials
• Develop processes to mitigate these drivers thereby further reducing denials
• Minimize denials through an effective Concurrent Review/Case
Management and notification process
Supporting Strategy - Denials Recovery
• Aggressive appeals process recover denied dollars
• Close the loop between approval and payment
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PREPARING FOR “RAC ATTACK ”
Primary Strategy: Data Management
• Audit existing data to identify opportunities for improvement including
areas of RAC emphasis
• Use audit results to develop processes that address identified areas
of opportunity
• Enhance existing UM/CM/SW processes based on audit findings
• Develop educational sessions as needed
• Re-assess and monitor impact of newly implemented processes
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PREPARING FOR “RAC ATTACK”
Using Data to Identify Opportunities
Audit charts for each RAC area of emphasis
• Objective chart review using CMS medical necessity criteria
(InterQual)
• Subjective chart review using physician medical judgment
• Data capture and analysis of denial variables
Analyze audited data and existing denials data
• Diagnosis
• Physician
• Denial type
• Delay reason
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PREPARING FOR “RAC ATTACK ”
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Denials Management Tracking and Audit Application
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PREPARING FOR “RAC ATTACK ”
Building Processes to Minimize Denials
• Obtain buy in from key stake holders to improvechances of success
- Physicians, nursing, UM, IT
• Prioritize process improvement to maximize returns• Select improvements with highest success rate
- Broadest impact across all payor types
- Simple implementation
•Primarily systems enhancements
• Minimal resource allocation
- Enhance and strengthen existing processes
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PREPARING FOR “RAC ATTACK ”
Building Processes to Minimize Denials
Examples of Process Improvement Activities
• Short stay denials
- RAC emphasis
• UM/CM/SW process enhancements
- Improve communications with payors
• Education
- Use data to identify educational activities forstaff
- Employ external resources as needed
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PREPARING FOR “RAC ATTACK”
Short Stay Denials
• Case manager assigned to ER to review admissions forselect diagnosis based on audit results
• Consult done in ER when possible prior to admission
• Consider implementing rapid chest pain protocol
• Educate ER staff on admissions criteria for commonlydenied diagnosis
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PREPARING FOR “RAC ATTACK”
UM/CM Process Enhancements
• Hold carriers to timely denial notification by denial log
• Use log to eliminate denials for no clinical and to drive peer-
to-peer process
• Use denials audit results to focus case management anddischarge planning activities
• Work closely with payor case manager on complex cases
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PREPARING FOR “RAC ATTACK”
Education
• Use denial audit results to guide educational initiatives
• Physician and UM/CM/SW educational sessions based on
frequently denied diagnosis
• Hospitalist groups respond positively with impressive endresults
• Individual physician improvements more difficult to
accomplish
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PREPARING FOR “RAC ATTACK ”
Secondary Strategy Denials Recovery
Ensure processes are in place to maximize denied claims
recovery
•Develop strong appeals capabilities
• Ensure aggressive payment follow through
• Ensure strong data capture and reporting capabilities
• Use data to identify areas of opportunity to enhance the
entire process
• Close the loop on denials prevention CQI
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PREPARING FOR “RAC ATTACK ”
Advantages of Physician Led Appeals
• Recognized as clinical expert vs other clinicians
• Able to challenge payers and provide clinical conviction
• Peer-to-peer review shown to prevent 15% of denials
• RAC auditors must provide a physician for peer-to-peer when requested
• Select payors now require a physicians’ name on theappeal
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PREPARING FOR “RAC ATTACK ”
The Appeal Process
Types of Appeals
• Informal peer-to-peer as soon as denial is identified, 1 day of denial
• First Level appeal with medical records, 15 to 180 days depending on
payor
• Second Level for some payors – typically 30 to 90 days• Third Level – for some payors – typically 30 to 90 days
• External appeals - usually through the MIA or CMS
Complexity of Appeals
Multiple payors Multiple rules Multiple levels Multiple time frames
Multiple regulators
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PREPARING FOR “RAC ATTACK ”
Automation and
Data Management
Research & Approval
Strategy Development
MCO Submission
Appeal Response
Determination Process
Payment Management
Process
Denial Process &
Intervention Reporting
MCO Process ManagementDenial Mitigation through Education
A Staged Approach to Appeals Management
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8/6/2019 AAHAM Presentation
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PREPARING FOR “RAC ATTACK ”
Identifying the Denial
• The EOB is the gold standard and should be crossreferenced with other denial sources to ensure denials arecorrectly identified
• For carriers with a short appeal response timeframe thedenial must be identified before the EOB is received
• Most denials are identified through the denial letter sentfrom the payor or phone calls
• Payor’s daily log is a good source for identifying denials
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PREPARING FOR “RAC ATTACK ”
The Medical Necessity Argument
• Critical components necessary for success
• Timeliness is critical and requires a complex and efficient
process to meet the varying requirements of numerous insurers.
• Medical necessity knowledge is key to a successful appeal and
often requires the leadership and input of a UM trained physician
• Intimate knowledge of criteria sets (Milliman, InterQual etc.)
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PREPARING FOR “RAC ATTACK ”
Managing The Appeal Response Process
• All appeals documentation must be:
- Sent by certified mail
- Tracking option activated
- Follow-up calls to facilitate return of late appeals
• Payors fail to return 35% of initial appeals for a variety of reasons• Depending on the insurer, only 35% to 60% of appeals are
completed within the required 30 days
• Process difficult to monitor without an appeals tracking system
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PREPARING FOR “RAC ATTACK”
• Once an appeal response is received a decision
must be made on next steps
• If approved, clearly payment must be pursued
• If denied:
• Should a Level 2 or 3 be pursued?
• Should the account be closed?
• Should an external review be filed?
• Between 10% to 25% of Level 2 or 3 appeals canbe overturned
• Significant medical necessity knowledge is neededto assess which appeals warrant a Level 2 or 3
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PREPARING FOR “RAC ATTACK ”
From Approval to Payment
• Assign accountability for payment follow-up
• Close the loop between approval andpayment
• Follow-up with payor to ensure 100% of approvals are paid
• Pay close attention to TPA’s
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PREPARING FOR “RAC ATTACK ”
Data Management, Reporting andPerformance Improvement
• Provide monthly results to key players
• Status reports provide updates on theappeals process
• Actionable reports drive the CQI process
• Monitor impact of process improvementactivities with tracking and trending of data
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PREPARING FOR “RAC ATTACK ”
Summary
• Preparation is key
• Minimize operational disruptions … its just another denial
• RAC demonstration – 42% of facilities had zero denials
• Use the opportunity to enhance your denials managementprocess … and come out ahead
• Reporting and continuous process improvement are
critical
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Case Management Covenants, LLC
Case Management Covenants is a Maryland based
healthcare consulting services company specializing indenial management, appeal management and RAC audit
preparation services.
Key Staff Contacts
President: Olakunle Olaniyan, M.D. – still a practicing physicianand former managed care VP and CMO.
Chief Operations Officer: Iskla “Chris” Brown - nurse executivewith many years experience in healthcare accreditationorganizations, commercial and government health insuranceentities.
Vice President, Business Development: Doug Allen – a strategicplanning professional with significant experience in both thecommercial and non-profit healthcare sectors.
410-715-4913