Minnesota Department of Human Services Recovery Audit Contract (RAC)

1. Minnesota Department of Human Services Recovery Audit Contract (RAC) Provider Outreach & Education Presentation April 18, 2013

2. Agenda • Introduction • HMS Overview • Minnesota’s Medicaid RAC Program • Complex and Credit Balance Reviews: Methodology Approach & Overview Review Process • Provider Portal • Answer Common Questions

3. Health Management Systems Presenters Lonnette Chilefone, Director, Minnesota Programs Joleen Bond-Livingston, Vice President, Recovery AuditGlenda Lloyd, Manager, DRG Coding Validation - RAC Mary Leigh Covington, Divisional Vice President Credit Balance Jeffrey Norman, Sr. Program Integrity Provider Services Supervisor

4. HMS OverviewJOLEEN Bond-livingstonVice President, Recovery Audit

5. About HMS • We provide cost containment services for healthcare payers • We help ensure that claims are paid correctly (program integrity) and by the appropriate responsible party (coordination of benefits) • As a result, our clients spend more of their healthcare dollars on the patients themselves 5

6. Background Recovery Audit Contractor • Medicare Modernization Act of 2003 created a demonstration project to identify Medicare overpayments • The program was operational from 2005 through 2007 • Following success of the demonstration project, the program was made permanent in 2008 • Section 6411(a) of the Affordable Care Act expanded RAC to Medicaidand required each State to begin implementation by January 1, 2012 • Identification of overpayments and underpayments • States & RAC vendor must coordinate recovery audit efforts • RAC vendors reimbursed through contingency model

7. HMS- Medicaid RAC Standards

8. RAC Process: Flow Transparency & Collaboration with Minnesota

9. Key RAC Considerations • Diverse focus on multiple provider and claim types • Minnesota approval on all initiatives • Supplement and wrap around existing Minnesota efforts • Pilot approach to confirm issue/scenario • Comprehensive provider education • Same appeal rights as other DHS post-payment reviews • 360 degree claim review • Clinical • Regulatory • Billing • Comprehensive panel of experts • Physicians, Nurses, Coders • Data analysts • Financial auditors 9

10. Overview of Review Process • Program Analysis • Data Mining/Scenario Design • State Approval Analysis And Identification • Provider Contact • Record Request/Receipt • Tracking/follow up Record Request • RN/Coder Review • Physician Referral • QA and Client Review/Approval Review/Audit • Notification Letter • Reconsideration/Appeal • Recovery Support Notification and Recovery • Provider Association Meetings • Program Recommendations • Newsletter/Website Education, Process Improvement

11. HMS RAC Support Staff • Experienced staff performing reviews according to provider types included in contract: • Certified Coders • Registered nurses • Specialized Therapy Professionals • Review panel of over 1,000 physicians • HMS has in-depth knowledge of • Minnesota Medicaid billing & reimbursement practices • Claims adjudication process • Medicaid data processed by Minnesota MMIS 11

12. HMS Audit Support • HMS Provider Services’ staff are practiced at establishing and maintaining effective communication with providers and strive to resolve provider issues on the first call 12

13. Minnesota Medicaid RACLonnette chilefonedirector, minnesota programs

14. Minnesota Audit Areas • Complex Reviews – Clinical based on DRG • Three year look back from paid date • Credit Balance Reviews – Financial • Five year look back from paid date 14

15. Complex Reviews • When analysis identifies a potential improper payment that cannot be automatically validated • Claims flagged for further review • Additional documentation is requested • Audit to determine if improper payment • Findings communicated with provider • Look back period is three years from paid date

16. Credit Balance Reviews • Not clinical reviews • Financial reviews • Payments and adjustments exceed the claim cost • Can occur as a result of many variables • Provides for identification of Root Cause • Look back period is five years from bill date

17. Minnesota Medicaid RAC Program Audit Areas

18. Audit Areas Continued

19. Review Process • Providers will receive audit notifications HMS letterhead that will be accompanied by the DHS authorization letter on DHS letterhead. • Audits will be conducted as desk reviews by experienced certified coders with access to a panel of physicians. • During this period, HMS may be in contact with the provider to ask questions or to request additional information. The provider may contact HMS at any time to discuss their review. • After the review process is completed, result letters are sent to providers to communicate: • Detailed description of final determinations • Improper payment amount • Option to appeal

20. Review Process • Receipt of records is extremely important to accurately and effectively conduct the audits in a timely manner. • Initial records request requires receipt of the records by HMS, no later than the end of the 30th business day from receipt of the letter documented by standard postal delivery tracking methods • Failure to produce records will result in the determination that your agency was improperly paid for all services under review for the requested dates of service resulting in a refund request for these amounts • Case reviews to be completed within 60 days from receipt of complete medical records

21. Review Process • Extrapolation will NOT be applied for hospital DRG inpatient review overpayment amounts identified • Current Minnesota appeal process will be utilized • Concentrated effort made to assure that audit letters are detailed and specific, helping reduce the burden of appeal on all parties • Providers are encouraged to call HMS’ Provider Services to discuss and resolve issues MN RAC toll free number: 855-394-8063 • Call volumes are monitored to address potential issues which may be used in educational sessions Questions for DHS may be sent via email to DHS.RAC@state.mn.us 21

22. Review Process Responsibilities HMS Providers Review Draft Audit Findings and respond within 30 calendar days of signed receipt of letter If in agreement with findings remit payment within 30 days If not in agreement with findings, submit a request for reconsideration within 30 days Review Final Calculation of Overpayment letter and: Agree and proceed with repayment, or File an appeal within 30 days • Send Draft Audit Findings Letter with results of review. • Work one-on-one with the provider to resolve any disputed cases, if provider requested reconsideration. • Send Final Calculation of Overpayment letter to provider indicating remaining interest owed after claim adjustment requests have been processed. • Support appeals process when applicable

23. Diagnosis Related Group (DRG) auditsGlenda Lloyd, MBA, BS, RHIA

24. Diagnosis Related-Group(DRG) Validation • The purpose of DRG validation is to ensure that diagnostic and procedural information and the discharge status of the member, as coded and reported by the hospital on its claim, matches both the attending physician's description and the information contained in the member’s medical record.

25. Validation Sets • Target analysis identifies situations in which demographics, billing attributes, diagnosis codes, procedure codes, and/or factors affecting the DRG assignment appear to be inconsistent with other attributes of the claim or case documentation within the medical record, and in instances where providers have billed for a higher paying DRG in an outlier status. 25

26. Credit Balance overviewMary Leigh CovingtongDivisional Vice President, Credit Balance

27. Currently serves 24 State Medicaid agencies, Medicaid Managed Care Organizations (MCO) and Commercial Insurance Plans 14 years of experience working with providers on credit balance audit projects Credit Balances Audits (CBAs) are focused on financial reimbursements to the provider Primarily the CBAs are focused on reviewing the Provider’s Accounts Receivables (AR), Remittance Advices (RA), Explanation of Benefits (EOB) and miscellaneous relevant financial documents. Experience determining and communicating with the provider the root cause of the identified overpayments or accounts resulting in credit balances HMS Credit Balance Audit (CBA) Overview

28. A credit balance occurs when the sum of payments received plus adjustments exceed the total charges on a claim Just because an account is sitting in a credit balance does not mean money is due back to the payer Common causes of credit balance include: Payments from third party payors and from Medicaid Duplicate Medicaid payments Charge reversals/adjustments/transfers Duplicate adjustments made to an account What is a Credit Balance?

29. Approach ROOT CAUSES NON-MONETARY • Inaccurate postings • Charges written off in excess of amounts actually billed • Provider A/R collection systems modeling net revenue at the time of billing MONETARY 65% 35% • COB • Retroactive payments • Double payments • Incorrect payments Not all overpayments are credit balances; not all credit balances are overpayments HMS provides a root cause analysis to prevent future credit balances.

30. Audit notice and Initial Contact Entrance Conference Review all active and inactive accounts in credit balance status as of the notice date Remote/Desk Reviews Provider Self Disclosure Review and Finalize findings Provider Attestation Process Exit Conference Recovery and Reporting Credit Balance Audits: Process Overview

31. Open communication with providers throughout the audit process Root cause analysis assists providers in preventing future overpayments Insure providers are up to date on the latest billing and reimbursement methods utilized by MN DHS Credit Balance: Provider Education

32. Minnesota Provider PortalJeff Norman

33. Provider Portal • The Provider Portal is a secure website that allows providers manage their RAC reviews. • More than 15,000 providers currently use HMS’s Provider Portal. • Contact information can be updated by providers. • Contains HMS contacts.

34. Provider Portal Secure website for each provider to manage reviews

35. Provider Portal

36. Provider Portal

37. Provider Portal

38. Provider Portal

39. Provider Portal

40. Provider Portal

41. Questions