IN THIS WEEK’S ISSUE:
- IRS Begins Inquiries Into Executive Compensation
- Requirements Revised for Contracted Services Payment
- CMS Urges Provider Action to Head Off Denials
- OIG’S First Advisory Opinion for 2005 Deals With Gainsharing
- CMS to Stop Review of Previously Denied Claims
- CMS Adds Guidance on Employer Drug Benefit Subsidy
- Hospital Philanthropy Outlook Troubled
- 2005 Poverty Guidelines Published
- Provider Survey Responses Needed
- Quick Links
- New In The PFS Forum
- New in the The Resource Center
1. IRS BEGINS INQUIRIES INTO EXECUTIVE COMPENSATION
At a February 4 meeting, IRS representatives confirmed that the agency has begun its compensation review project targeting tax-exempt organizations. The IRS expects to contact 1,784 tax-exempt organizations and make inquiries regarding the process by which compensation is established for highly compensated individuals. About half of the contact letters have been mailed, and the IRS expects the remainder to be mailed by the middle of March. The letters focus on compensation but also seek information regarding loans and excess benefit transactions. The probe is not targeting hospitals solely; however, hospitals are part of the not-for-profit mix the IRS is contacting.
2. REQUIREMENTS REVISED FOR CONTRACTED SERVICES PAYMENT
CMS has revised its requirements pertaining to Medicare payment for services provided under a contractual arrangement making it unnecessary for program integrity standards to be included in written contracts, but stating that the entity and physician (or other person) are both subject to those safeguards.
The revisions also replace the facility exception and healthcare delivery system clinic exception.
3. CMS URGES PROVIDER ACTION TO HEAD OFF DENIALS
On February 16, CMS issued special instructions to address increased denials due to conflicting claims and beneficiary record data. An October 2004 software change that required an exact match on beneficiary first initial, surname, and health insurance claim number has tripled the denials attributable to name/number mismatches. In a Medlearn Matters article, CMS is urging that providers:
o Ensure the name on the claim matches the name on the beneficiary’s Medicare card
o Always use the name on the Medicare card when submitting the claim, even if the patient says the name on the card is incorrect
If beneficiaries insist the Medicare card is incorrect, providers should advise them to contact their local Social Security Field Office to obtain a new card, CMS instructs. Providers with questions about this issue should contact their Medicare carrier, intermediary, or durable medical equipment regional carrier.
4. OIG’S FIRST ADVISORY OPINION FOR 2005 DEALS WITH GAINSHARING
The OIG, in Advisory Opinion 05-01, would not impose sanctions in connection with a proposed arrangement in which a hospital and a group of cardiac surgeons would share in savings from a number of cost reduction measures for certain surgical procedures, even though the OIG concluded that the proposed arrangement would constitute an improper payment to induce reduction, or limitation, of services as stated under sections 1128A(b)(1)-(2) of the Social Security Act.
“Our decision not to impose sanctions on the requestors in connection with the proposed arrangement is an exercise of our discretion and is consistent with our Special Advisory Bulletin on Gainsharing Arrangements and CMPs for Hospital Payments to Physicians to Reduce or Limit Services to Beneficiaries,” the opinion states.
5. CMS TO PROVIDE FOR AUTOMATIC DENIALS
Beginning July 5, 2005, the Medicare carrier system (MCS) will automatically deny as duplicate a newly submitted claim that duplicates one that a contractor has:
- Already denied for medical review reasons
- Medically reviewed
- Requested supporting documentation that was never received
Additionally, the denial of duplicate claims cannot be appealed, CMS said, unless the provider documents that the service was not a duplicate, and it was performed more often than indicated in the original claims.
6. CMS ADDS GUIDANCE ON EMPLOYER DRUG BENEFIT SUBSIDY
The subsidy to employers or unions for providing drug coverage to retirees is expected to average about $668 per person per year, according to new CMS guidance on the subsidy and employer responsibilities. The CMS guidance supplements the regulations with overviews of the law, the subsidy, and the waivers and options that have to be considered. Issue papers provide more detail on the options. Additional help is available through the CMS Employer Policy & Operations Group at epog@cms.hhs.gov.
Get links to the new prescription drug benefit guidance and other additional information from the CMS web site.
7. HOSPITAL PHILANTHROPY OUTLOOK TROUBLED
Although the future of philanthropy looks bright, the outlook is less robust for hospital philanthropy, especially for community hospitals, according to a new book published by the Association for Healthcare Philanthropy. According to Forces of Change: The Coming Challenges in Hospital Philanthropy, the growing commercialization of not-for-profit hospitals, continuing evidence of civic disengagement, and generational characteristics are the leading forces of change that could lead to diminished returns on hospital fundraising.
AHP reports record numbers of professional hospital fundraisers and the growing involvement of CEOs in fundraising, yet the proportion of philanthropic income to total hospital income remains a nominal amount, largely an unchanged percentage for decades.
Purchase Forces of Change: The Coming Challenges in Hospital Philanthropy from AHP's bookstore.
Learn more about the role of fundraising in capital acquisition with the recording of "Philanthropy: Getting Help From Your Friends," a June 2004 HFMA audio webcast.
8. 2005 POVERTY GUIDELINES PUBLISHED
The federal poverty level for a family of four rose from $18,850 in 2004 to $19,350 in the latest version of HHS poverty guidelines published in today’s Federal Register. The updated guidelines reflect the increase in prices as measured by the Consumer Price Index. The poverty guidelines are a simplified version of the federal government’s statistical poverty thresholds, which the Census Bureau uses to prepare its estimates of the number of people and families in poverty.
9. PROVIDER SURVEY RESPONSES NEEDED
Due to a lower-than-expected response to a survey mailing, CMS is making a special request that providers respond to the Medicare Contractor Provider Satisfaction Survey (MCPSS) sent to a random sample of 8,200 Medicare fee-for-service (FFS) providers in January. The MCPSS is a new initiative designed to collect data on provider satisfaction with the services provided by Medicare FFS contractors. The survey gives providers the opportunity to rate their Medicare contractor on seven administrative functions: provider communications, provider inquiries, claims processing, appeals, provider enrollment, medical review, and provider reimbursement.
Westat, a survey research firm, is administering the MCPSS. Providers who received the survey notification packet can access the survey instrument on a secure Internet web site, or they may request a paper copy and submit their responses via mail or fax. All information collected will be kept completely confidential, CMS assures. Data collection for the pilot will continue through March 31, 2005. CMS asks those who received a survey notification packet to please complete and submit a survey response as soon as possible.
For questions regarding the MCPSS, contact the MCPSS information line at 1-888-863-3561 or MCPSS@westat.com
10. QUICK LINKS
2005 PHYSICIAN FEE SCHEDULE DATABASE UPDATE. CMS issued an update February 11 to the 2005 Medicare Physician Fee Schedule Database. This update amends the payments files for the November 15, 2004 fee schedule and is effective January 1, 2005.
VACCINE BILLING INSTRUCTIONS CLARIFIED
When submitting Medicare claims for inpatients’ vaccines and their administration, hospitals will have to use the 12X type of bill (TOB) rather than 13X, according to CMS claims processing transmittal 473 issued February 11. This transmittal will be effective July 1, 2005.
CWF SNF CONSOLIDATED BILLING EDITS FOR AMBULANCE TRANSPORTS TO OR FROM A DIAGNOSTIC OR THERAPEUTIC SITE. CWF edits will reject Part B ambulance line items (not claims, as originally stated) containing revenue code 054x, in addition to an origin/destination modifier of “ND” or “DN”, when the beneficiary is in a covered Part A SNF stay, according to transmittal 459. It will be effective April 1, 2005.
HMO PROFITABILITY. Fifty percent of the nation’s HMOs are considered financially strong, according to Weiss Ratings, a distinct difference from year-end figures in 1998, when only 20.8 percent of HMOs received high ratings.
IRS TAX-EXEMPT ORGANIZATION WORKSHOPS. The IRS has opened registration for workshops for small and mid-sized tax-exempt organizations to be held this spring and summer in Houston; Ft. Lee, N.J.; San Francisco; Cleveland; Arlington, Va.; and Charlotte, N.C.
11. NEW IN THE PFS FORUM
POST-ENCOUNTER JOB DESCRIPTIONS. A new section of post-encounter job descriptions has been added to the PFS Forum Job Description Library. These are actual job descriptions shared by PFS members to help fellow members develop effective job descriptions for specific settings. (Available to PFS Forum members only.)
12. FEATURED IN THE HFMA RESOURCE CENTER
HFMA GLOSSARY. The healthcare finance field is rife with jargon and conflicting definitions. Use this handy searchable database to look up healthcare financial management terms and acronyms. Or, purchase a hard copy of the full glossary (64 pages) for $25 from the HFMA Resource Center, (800) 252-HFMA, ext. 3.
Copyright 2005 Healthcare Financial Management Association, all rights reserved. HFMA Express News ISSN: 1540-0689. Volume XII, Number 7.
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