IN THIS WEEK’S ISSUE:
- Payment for Care to Undocumented Aliens Moves Closer
- CMS Corrects FY05 Inpatient PPS Wage Index Tables
- CMS Issues Instructions On CAHs Distinct Part Units
- RHCs Get Grace Period For RHC Location and Quality Regs
- CMS Clarifies Use Of SNF Bill Type 22X
- Number of Uninsured Continues To Rise
- Capital Outlook Holds Challenges, Opportunities
- Quick Links
1 . PAYMENT FOR CARE TO UNDOCUMENTED ALIENS MOVES CLOSER
CMS has begun outlining the process for providers to be paid their part of the $1 billion called for by the MMA for emergency health services to undocumented aliens. To be eligible for payment, providers are required to fill out an application ("Section 1011 Enrollment Application"), which was posted on the CMS web site on September 1.
This enrollment is independent of the Medicare enrollment process; current Medicare participating providers must submit the form in both hard copy and on-line formats. Physicians and ambulance providers not participating in Medicare must complete a Medicare enrollment application in addition to the Section 1011 form.
CMS will soon issue its payment methodology related to emergency care for undocumented aliens, along with patient eligibility documentation requirements. Payments will start after the end of the first quarter (October 1 through December 31, 2004). Because there is a fixed amount of funding with an unknown number of claims, entities receiving these payments should note that in the event of a retroactive adjustment, any payment due to CMS must be made within 30 days of receiving notice.
2. CMS CORRECTS FY05 INPATIENT PPS WAGE INDEX TABLES
CMS has reissued wage index tables that were part of the Medicare inpatient PPS final rule for FY05. The tables were originally published with technical errors on August 11. CMS will be republishing the tables, and they are also currently available on the CMS web site.
These are important changes, particularly for some providers, because the data are integral to geographic reclassification determinations and decisions. In an August 31 open door forum, CMS advised callers that in cases of data already submitted in a geographic reclassification request, use of the incorrect data will not invalidate the request. In the event a hospital determines it no longer wants to be reclassified, the request can be withdrawn. As for new requests, CMS has advised HFMA that September 1 was the statutory cut-off date for filing reclassification requests for FY06, and CMS does not have the authority to change this deadline.
3. CMS ISSUES INSTRUCTIONS ON CAH DISTINCT PART UNITS
Effective October 1, 2004, inpatient rehabilitation facilities (IRFs) can be located in a critical access hospital (CAH), will be paid under the IRF prospective payment system, and will be identified by provider number xx-Rxxx, CMS announced in an August 13, transmittal. Inpatient psychiatric units may also be located in a CAH, but they will be paid on a reasonable cost basis until the inpatient psychiatric facility PPS is established in 2005. These units will be identified by provider number xx-Mxxx.
CMS will be unable to process claims for these units until January 3, 2005. Providers should submit their distinct part unit claims, but Medicare will not release the claims for payment until January 3. These claims will qualify for interest.
4. RHCs GET GRACE PERIOD FOR RHC LOCATION AND QUALITY REGS
State survey agencies should not disqualify any currently approved rural health clinics (RHCs) because of location, according to the CMS state survey and certification letter S&C-04-42. Additionally, survey agencies should not yet consider mandatory the December 24, 2003, quality assessment and performance improvement (QAPI) program requirements. CMS has not yet implemented RHC regulation changes published last December that modified RHC location requirements and established the QAPI program.
The August 12 letter to the states also informs the survey agencies that any RHC that has implemented the QAPI program in accordance with the December 24, 2003, requirements should be considered to be in compliance with existing program evaluation requirements.
5. CMS CLARIFIES USE OF SNF BILL TYPE 22X
CMS has clarified a February transmittal, Change Request (CR) 3031, which stipulated that bill type 22X should be used for skilled nursing facilities’ billings for Medicare inpatient Part B. Many Medicare providers are accustomed to considering Part B claims “outpatient.” However, CMS said in the transmittal that HIPAA requires Medicare to treat these claims as “inpatient” bills. HIPAA affects all payers and not just Medicare, according to CMS, and inpatient claims must be assigned as such. CR 3031 adds the HIPAA requirements to those of Medicare and identifies elements that Medicare has not transmitted before.
This issue is particularly significant to direct data entry (DDE), according to CMS, because it requires providers to make a choice of either “inpatient” or “outpatient.” Providers submitting type of bill 22X should submit it as an inpatient claim, and that should simplify what must be transmitted as well as permit transmitting new required fields. Medicare forces the DDE system to only take the required fields for HIPAA, and the situational, non-required fields only when there is a Medicare business need to take them. Providers will run into problems when they try to transmit situational fields not required for Medicare’s business needs.
CMS stated that there will be further clarifications issued for CR3031.
6. NUMBER OF UNINSURED CONTINUES TO RISE
The number of uninsured increased 1.4 million between 2002 and 2003, to 45 million, while the number of people with insurance rose by 1 million to 243.3 million in 2003, according to a recent report by the Census Bureau. Additionally, the percentage of people covered by employment-based health insurance dropped from 61.3 percent in 2002 to 60.4 percent in 2003. The drop in employment-based health insurance coverage was the primary cause of the decrease in total health insurance coverage (69.9 percent in 2002 to 68.6 percent in 2003), according to the report.
In 2003, 26.6 percent of the population received some form of government health insurance, the highest percentage since 1995. The report attributes the growth of this population to increases in Medicare and Medicaid coverage, which rose to 12.4 percent and 13.7 percent respectively. However, the population of uninsured children in 2003 remained steady at 11.4 percent.
7. CAPITAL OUTLOOK HOLDS CHALLENGES, OPPORTUNITIES
Limited capital access may force some hospitals to fall further behind, lead to facility closures, and cause quality to suffer in institutions that fail to keep up with technology improvements, according to a panel of experts interviewed for the sixth and final Financing the Future report, Where the Industry Will Go from Here, released this week.
The experts also recommended strategies for improving hospital financial outlook, including:
- Focusing on core service lines
- Deploying resources strategically
- Outsourcing
- Engaging in joint ventures
- Rationalizing assets
Financing the Future is led by HFMA in partnership with GE Healthcare Financial Services, with research conducted by HFMA and PricewaterhouseCoopers.
8. QUICK LINKS
HOSPICE WAGE INDEX UPDATE PUBLISHED - CMS has published in the August 27 Federal Register the annual update to the hospice wage indices, effective for the fiscal year October 1, 2004, through September 30, 2005. The wage index in this notice is applied to the labor portion of the rates published in the Recurring Update Notification of August 4, transmittal 271 (see August 13 HFMA Express News).
NCQA RELEASES DRAFT OF QUALITY PLUS PROGRAM STANDARDS -. The National Committee for Quality Assurance (NCQA) released for public comment draft standards of its new Quality Plus measurement and accreditation program. The voluntary program seeks to transition into a "new, more flexible generation of measurement and accreditation programs" such as the consumer-directed health plans. Comments are due by September 15, 2004, and must be submitted through NCQA's comment form and sent by e-mail. to ME2005@ncqa.org.
.
Review the draft standards.
CMS ISSUES NEW PROVIDER NUMBER FOR HOME HEALTH AGENCIES. - CMS has published a new provider number for home health agencies (HHAs). The new number is a 10-digit alpha-numeric number with the letter “Q” in the third position between the State code and the 4-digit provider designation. In addition, CMS assigned a 6-digit provider number with the letter “L” in the third position to psychiatric residential treatment facilities.
Copyright 2004 Healthcare Financial Management Association, all rights reserved. HFMA Express News ISSN: 1540-0689. Volume XI, Number 35.
For customer service, send an e-mail to HFMA’s Member Service Center or call (800) 252-HFMA, and press 2.