In this course, we will:• Review general requirements for reporting and returning of overpayments, to

include:• Overpayment Law • Key CMS Overpayment Regulations

• Review MCNH CIA requirements for overpayments• Review Navicent Health’s overpayment policy and processes

We recognize that you may already have received some overpayment training through other training modules, such as general compliance training. This training module provides more in-depth training on overpayment requirements.

Overpayment Training• In connection with its Corporate Integrity Agreement (CIA), Navicent Health

developed and submitted a Training Plan to the Office of Inspector General (OIG).– That Training Plan included a training session on overpayments

• The overpayment requirements are technical and complex. – We recognize that this training module will not be able to cover every nuanced aspect

of the overpayment requirements or factual scenarios that may arise.

• Accordingly, our goals for this training module include: – Provide an overview of the key overpayment requirements– Bring additional awareness to the importance of overpayments– Provide you with additional information to help you recognize potential overpayments– Outline key overpayment polices and processes in place at Navicent Health– Let you know where to direct questions about the overpayment processes or potential

overpayments.

Overpayment Statutes • Overpayment Law

• In 2010, the Affordable Care Act (ACA) enacted a statutory requirement that a person who has received an overpayment must report and return the overpayment within either 60 days after the date on which the overpayment was identified or on the date any corresponding cost report is due, whichever is later.

• This requirement applies to Medicare and Medicaid overpayments.

New Overpayment Regulations • CMS Overpayment Regulations*

– In May 2014, CMS released the Medicare Parts C/D Overpayment Final Rule. – In February 2016, CMS released the Medicare Parts A/B Overpayment Final Rule.– CMS has not released Medicaid overpayment regulations to date.

*The focus of this training is on the Medicare Parts A and B overpayment requirements

• These CMS regulations (specifically the February 2016 A/B rule) provide further insight into the government’s expectations.

• The Medical Center CIA also contains overpayment provisions which provide further information.

What Is An Overpayment?• Generally speaking, an overpayment is an amount paid by a Government payor (e.g.,

Medicare or Medicaid) to Navicent Health that should not have been paid, or is more than what should have been paid.

• There are many possible sources of overpayments, including:– Upcoding – Payments for non-covered services– Coverage termination – Duplicate payments – Receipt of Medicare as primary when another insurer has primary responsibility – Etc.

• All federal healthcare program overpayments should be reported and returned in accordance with the rule regardless of the reason the overpayment occurred, including:– Human error– System error– Contractor error– Fraudulent behavior

Hypothetical #1You identify an account that has a credit balance. The credit occurred because the beneficiary provided incorrect information on the MSP questionnaire. Is this an Overpayment?

Excess payments that occur because of an incorrect MSP questionnaire would be Overpayments for purposes of the new Medicare A/B rule.

The credit balance occurred because Cahaba processed the claim incorrectly. Are payor errors subject to the Overpayment rule?

Even though Cahaba made the payment error it is still an Overpayment if the payment exceeded what should have been paid.

The beneficiary has been admitted multiple times, and owes money for claims related to a different stay. Can you apply the credit amount to reduce the balance on the other account?

No, a credit balance from one stay cannot be applied to a second stay where payment is still owed.

Why Are Overpayments So Important?• Failure to properly report and return overpayments can result in significant

liability, including financial penalties and individual liability.• In addition, the CIA provides additional requirements involving the reporting and

refunding of overpayments. – The CIA also provides for a penalty of $2,500 per day for late reporting and returning

of identified overpayments.

Overpayment Analysis is a Team Effort

• The rules and regulations regarding overpayments are very complex.• Analysis of any potential overpayment is often very fact-dependent.

– Potential overpayment analyses often require a team effort.– Communication and collaboration with key stakeholders (e.g., legal, compliance,

subject area experts, etc.) is often critical.• The stakes can be high if the overpayment requirements are not satisfied.

General Overview ofOverpayment Rules

Overpayment Law

• A person who has received an overpayment must report and return the overpayment within either 60 days after the date on which the overpayment was identified or on the date any corresponding cost report is due, whichever is later.

• The term “overpayment” means any Medicare or Medicaid funds that a person receives or retains to which the person, after applicable reconciliation, is not entitled.

(42 U.S.C. § 1320a-7k(d))

New CMS Regulations: Medicare Parts A & B Overpayments

• New CMS regulations effective March 2016 provide additional guidance regarding Medicare Parts A and B overpayments.

• An overpayment is identified “when the person has, or should have through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment.”

• Key Concepts: • Reasonable Diligence • Quantification

Reasonable Diligence

• The finalized definition of “identification” incorporates concept of “reasonable diligence.”

• When does the 60-day clock begin to tick?1. When the exercise of reasonable diligence is completed, or

2. If there is a failure to exercise reasonable diligence, on the day when the person received credible information of a potential overpayment.

• CMS states that reasonable diligence includes both proactive compliance activities and reactive investigative activities.

• CMS also states that absent “extraordinary circumstances,” a timely, good faith investigation of credible information will last at most six months from the receipt of the credible information.

When Does an Organization Have a Duty to Investigate a Potential Overpayment?

• Receipt of “credible information” triggers a duty to investigate.– “Credible information” is not specifically defined, but includes

information that “supports a reasonable belief that an overpayment may have been received.”

– Many potential sources of credible information.• For example, CMS stated that it believes that “contractor overpayment

determinations are always a credible source of information for otherpotential overpayments.”

Potential Sources of “Credible” InformationThere May Be Many Potential Sources of Credible Information

NOTE: Each factual scenario must be evaluated to determine whether it amounts to “credible information” – not all information will be credible.

Quantification of Overpayments

• In general, an overpayment is not “identified” until it is quantified.– However, CMS makes clear that there is not an unlimited time to

quantify overpayment. – Maximum 6 month investigation timeline unless extraordinary

circumstances. • Determining when an overpayment was “quantified” can be a

complex analysis and may require input from the Legal Department and/or other Departments.

Hypothetical #2As you are processing Medicare payments for recent admissions you notice that payment on several accounts where patients were at MCNH for kyphoplasty procedures have been pended or denied.

Are there Overpayments on these denied accounts?No. If payment has not been made by the payor there are not any identified Overpayments.

Do the new regulations create any obligations related to these denials?Yes. There may be an obligation to consider whether a pattern of denial may mean that there have been Overpayments on other similar accounts.

Hypothetical #3

As you have coded recent outpatient procedures for billing you have noted that a certain provider regularly fails to provide documentation that supports the services that are provided.

Could insufficient documentation result in an Overpayment?Yes, insufficient documentation could certainly result in an Overpayment.

“Sufficient documentation and medical necessity are longstanding and fundamental prerequisites to Medicare coverage and payment.”

81 Fed. Reg. 7658

Lookback Period

In general, Overpayments must be reported and returned “only if a person identifies the Overpayment within six years of the date the Overpayment was received.”

– 6 years is a Maximum Threshold – there may be circumstances justifying a more limited lookback period (such as a coverage or process change).

– Accordingly, it is important to consult appropriate stakeholders (legal, compliance) before finalizing lookback period.

– This underscores the importance of coordinating any audit efforts with the compliance department.

Summary Timeline

MCNH’s CIA Requirements for Overpayments

• Report and return all identified Overpayments within 60 days of identification, and take remedial steps within 90 days after identification to correct the problem, including preventing the underlying problem and the Overpayment from recurring. (CIA §III.I.3.a.)

• If not yet quantified within 60 days after identification, MCNH shall notify the payor of its efforts to quantify the Overpayment amount along with a schedule of when such work is expected to be completed. (CIA §III.I.3.a.)

• Reportable Events: notify the OIG within 30 days of identifying a Substantial Overpayment at MCNH. (CIA §III.J.3.)

• Develop and implement written policies and procedures regarding the identification, quantification and repayment of Overpayments. (CIA §III.J.2.)

• Provide training on Overpayment requirements to CIA Covered Persons. (CIA §III.C.1. & Training Plan)

MCNH’s CIA Requirements for Overpayments

• Annual Reports: (1) a description of any changes to the Overpayment policy; and (2) a report of the aggregate Overpayments returned to Federal healthcare programs, broken down as follows:

• IP Medicare• OP Medicare• Medicaid (by State)• Other Federal healthcare programs. (CIA §V.B.16 & 17.)

• CIA Stipulated Penalties: $2,500/day for failing to:• Have/maintain Overpayment policies & procedures;• Repay Overpayments as required by the CIA• Report Reportable Events (including Substantial Overpayments) to the OIG• Submit required Annual Reports

Navicent Health’s Related Policies & Procedures

To access the documents, click the links below.

• Work Instruction 415.5536: OverpaymentsOverpayments Work Instruction Document

• Work Instruction 415.4969: Government Overpayment ProcessGovernment Overpayments Process Document

• Policy #154: Compliance Corrective Action PlansCompliance Corrective Action Plans Document

• Work Instruction 156.5441: Internal Reporting of Possible Compliance IssuesInternal Reporting of Possible Compliance Issues Document

Work Instruction 415.5536: Overpayments

• Policy tracks statutory and CIA requirements regarding Overpayments• Policy outlines appropriate processes for reporting and returning Overpayments• Policy should be reviewed periodically by all Revenue Cycle staff and Management

• Policy Requirements: Report and return all identified Overpayments within 60 days of identificationMust notify the Chief Compliance Officer immediately of any possible Substantial

Overpayments (defined as $100,000 or more) Track identified/returned Overpayments in Soarian Take necessary corrective action to prevent similar Overpayments within 90 days

Monitoring for Potential Overpayments: requires all personnel involved in development and submission of claims to: use their best efforts to make reasonable inquiries about the accuracy of claims and

payments; use reasonable diligence to proactively monitor accounts for the existence of any

potential Overpayments & monitor sources of potential credible information for potential Overpayments.

• Policy Requirements (cont.):– Evaluation of Potential Overpayments:

• Personnel must raise potential credible information of Overpayments or concerns with appropriate leaders

• The evaluation of potential Overpayments, including any review design, is a factually-dependent inquiry, and as such, appropriate stakeholders must be involved

• Absent extraordinary circumstances, the reasonable investigation of credible information and evaluation of potential Overpayments should take at most 6 months

– Reporting and returning Overpayments. Provides that identified Overpayments may be returned by: Electronic refund or re-billing processes, or By check with sufficient information to allow the payor to process the refund.

Work Instruction 415.5536: Overpayments

• Requires all employees to report possible compliance concerns. How?– Supervisor, manager, hotline, online reporting form, Corporate Compliance– Requires leaders and managers to report concerns directly to the Corporate Compliance

department• Prohibits retaliation for good faith reports of compliance concerns• Includes many examples of suspected compliance issues that must be reported,

including many that may impact payment from Federal health care programs.

New Policy: Compliance Corrective Action Plans

• Adopted by the Executive Compliance Committee on April 12, 2016• Requires formal (written) corrective action plans for all Reportable Events (incl.

Substantial Overpayments) and for all matters for which remedial action will take longer than 30 days to implement.

Work Instruction 156.5441: Internal Reporting of Possible Compliance Concerns

Central Business Office Procedure: Government Overpayments

• Steps required to code a potential Government Overpayment: everyone’s role

• Government Overpayment Analyst’s role to evaluate possible Overpayments

• Tracking Overpayments for the CIA Annual Report

Hypothetical #4

As you have processed payments for the infusion center over the last several days you have noticed that several patient accounts have received significant payments (each in excess of $30,000) for infusions. Because these payments exceed what you normally see, you review charges on two of the accounts and determine that the units of service billed far exceed what is documented in the patient’s medical record.

What should you do next?Discuss the situation with your manager or with the compliance department. Where multiple accounts are involved, or if you identify a Substantial Overpayment ($100K or more) you or your manager MUST contact the Compliance Officer.

What Overpayment obligations could be created by this scenario?There is an obligation to investigate to determine whether there is an Overpayment, and an obligation to report and return any Overpayments that are identified.

QuestionsIf you have questions about the material in this training session, or about an Overpayment situation, you can contact any of the following for assistance:

• Managers, Supervisors, Leaders Responsible for Compliance with Legal and Regulatory Requirements

Corporate Compliance• Responsible for Managing the Compliance Program

Practical Tips• Overpayment rules are complicated. Collaboration (with legal, compliance, etc.) is key.• Everyone is responsible for assuring accuracy of claims and to monitor for Overpayments.• Everyone is responsible to report possible compliance concerns.• Analysis of potential Overpayments is fact-specific and can be very technical.

Click the link below and complete the Overpayments Training Post-test:

http://w3.mccg.org/iota/test-overpayments.asp

When the test is successfully completed, you will be prompted to enter information to record your

results.