HCFA to PROs: Cut billing errors at least 10%
Peer review organizations (PROs) may be the government’s newest allies in its war on health fraud. HCFA’s new statement of work for PROs tasks them with detecting billing errors and reporting errors to OIG and other enforcement agencies.
More ominous is a HCFA directive that PROs must actively reduce billing errors. Each PRO will be expected to cut errors at least 10% during the three-year contract, with HCFA’s ultimate goal for the entire program to slash total errors by half. Their reward will be a hefty bonus that pays .05% of their base contract for every 1% that errors drop in their states, to a maximum of 10%. PROs that discover fraud must refer the cases to fiscal intermediaries or enforcement agencies like OIG.
This could poison the relationship between providers and PROs. Providers groups have already indicated that they expect their members to be less cooperative with PROs, says Regina Buchanan, director of quality improvement for the American Health Quality Association, which represents PROs.
HCFA will judge PROs on their success in implementing a Payment Error Prevention program, which is designed to spot inpatient PPS errors. This includes "pattern analysis of billing data and individual record reviews," according to HCFA. HCFA also expects PROs in each state to identify trends, such as incorrect DRG coding, inappropriate transfers, premature discharges and medically unnecessary care. Those trends will be used to create new areas for PROs to focus on. Buchanan says the details have yet to be worked out, but the system may involve HCFA identifying large-scale patterns of coding errors, then asking PROs to spot providers who fall outside baseline norms. Note: the statement of work specifically directs PROs to initially focus on reviewing and reducing the number of unnecessary hospital admissions and the number of DRG upcodings.
In the past, HCFA referred records of cases involving suspected fraud to PROs for analysis. HCFA later shifted the focus of PROs to quality of care, and now fraud is getting a major issue in peer review. PROs will be asking HCFA to ease some of the fraud review requirements, which essentially put PROs in the uncomfortable role of behaving like fiscal intermediaries, says Buchanan.
You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
- Award-winning Medical Content
- Latest Advances & Development in Medicine
- Unbiased Content