Fighting Back: Strategies to Address the RAC Audit Threat

In the search for silver linings in the current dark clouds of Recovery Audit Contractor (RAC) audits, there is one: this is a situation everyone wants to resolve. Most OP&P practices either have been faced with or are dreading the painful consequences of the Centers for Medicare & Medicaid Services (CMS) audits that have created great consternation and loss within the orthotic, prosthetic, and pedorthic communities: unsustainable cash flow challenges, a negative impact on the quality and timeliness of patient care, and the often significant financial penalties for the absence of documentation beyond practices' ability to provide. (Editor's note: For more about those consequences, see "Under Siege: CMS Audits Take Their Toll" in this issue.)

The industry leaders we contacted agreed universally that something must be done to help the profession, individual businesses, and practitioners cope, survive, and somehow thrive again, but the list of possible strategies they offered is long, and opinions are divided.

Strategy 1: A Lawsuit against CMS

Listed as number one on the strategy list, the lawsuit the American Orthotic & Prosthetic Association (AOPA) filed in mid-May on behalf of its members was probably not anyone's first choice as a response to the audit situation, but nonetheless, here we are.

"The HHS [U.S. Department of Health and Human Services] Office of Inspector General report titled, 'Questionable Billing by Suppliers of Lower Limb Prostheses,' (August 2011) and the CMS 'Dear Physician' letter (published in August 2011) heightened the Medicare documentation requirements for prosthetic claims," explains Peter Thomas, JD, general counsel for the National Association for the Advancement of Orthotics and Prosthetics (NAAOP). "The 'Dear Physician' letter advises doctors how to supply appropriate documentation of medical necessity, should a Medicare audit contractor request it-since 'the prosthetist's records must be corroborated by the information in your patient's medical record. It is the treating physician's records, not the prosthetist's, which are used to justify payment.' This statement in the 'Dear Physician' letter is responsible for many of the prosthetic claims being declined upon post-payment review."

Because there is no incentive for physicians to provide the requested documentation nor penalty incurred for not doing so, many do not. Others simply keep insufficient records in their own medical files. CMS' willingness to recognize the prosthetist's records as part of the formal medical record could solve the problem, but although this has been discussed-and even agreed upon in meetings with CMS officials-CMS is apparently reluctant to move forward to correct what are admittedly injustices to O&P practitioners who are providing a fair service in good faith.

Thus, prosthetists must repay the entire amount of CMS' reimbursement for a prosthesis for which they spent their own money to purchase components-and then do without that money until the usually lengthy appeals process (up to two years depending on which appeal level is reached) is completed. "The AOPA lawsuit was filed because CMS is just not listening to the O&P organizations, despite numerous attempts to convince them to implement a more reasonable documentation standard. They seem to listen in good faith long enough for us to make our case and then nothing seems to change," Thomas says. "A civil lawsuit against the government is a big uphill battle-everyone acknowledges that. There are certain barriers that are put into place to protect the government from being sued, so the deck is stacked against the O&P field on this one, but the hope is that CMS-and the judge the case is assigned to-sees this lawsuit as a credible argument, a credible lawsuit, and ultimately agrees that CMS needs to take some steps to figure out a solution to the problem.

"And maybe this litigation presses them to be a bit more diligent about actually doing that-that's the hope."

Catherine Pruitt, president, PrimeCare Network for Orthotic, Prosthetic, Pedorthic & Complex Rehabilitation, Germantown, Tennessee, is optimistic. "I think that the lawsuit AOPA is pursuing is hopefully going to effect some changes, and, at the least, it is something of a morale booster to know that something material is being done on behalf of O&P facilities and providers."

Peaceful negotiation would be a preferable first step, Brian Gustin, CP, president, Forensic Prosthetic and Orthotic Consulting, Suamico, Wisconsin, says. "The two parties need to get together around a table and talk. It's unfortunate AOPA has had to sue CMS because I don't think anybody really wins when you get to this point, and the process will take so much longer. But I know AOPA tried to go through various CMS channels to talk about some of these issues, and they have been politely listened to and essentially ignored."

"As usual, our industry is a day late and a dollar short," argues Aaron Sorensen, CPO, president of Restorative Health Services and Orthotic & Prosthetic Billing Solutions, both headquartered in Murfreesboro, Tennessee. "The damage is done. A lawsuit should have been launched six months to a year ago. But I also think you have to be careful when you awaken a sleeping giant like CMS and HHS by suing them. Let's just say they could make life even more difficult."

"If we win it would be nice, but I don't think we will," says Rick Fleetwood, MPA, CEO, Snell Prosthetic & Orthotic Laboratory, Little Rock, Arkansas. "Over 95 percent of lawsuits are lost, but if it has merit, a suit at least brings CMS to the table, so I applaud AOPA's effort and hope it prospers."

Strategy 2: Congressional Support

Anticipating impending Medicaid RAC audits, too, Ray Fikes, CPO, Fikes Brace & Limb, Mesa, Arizona, is considering a lawsuit on different grounds. His points of focus: "The MCOs [managed care organizations] that administer Medicaid are culpable for their authorizations and have not been given impunity by the state or federal government; both the federal and state language says that there can be no duplicity of claim investigation; and in both the federal and state language a 'prior authorization' is considered a fraud and abuse mechanism or, in other words, an 'investigation.'" Success in this Medicaid battle could invalidate the Medicare premise "that we should have known" with regard to RAC recoupments, he says.

Whether his suit succeeds or fails, however, Fikes feels that it is essential to get legislators involved-as many of them, and as fully committed to the cause, as can be managed. That will require public education that fuels outrage and motivates as many "letters to your congressman" as possible. To that end, he is developing a documentary for syndication featuring war veterans to explain and illustrate how the CMS RAC audits have impacted their O&P care and limited their practitioners' ability to provide it.

Viewers will be encouraged to write their senators and representatives, urging them to disband the RAC audit system and force Medicare to pre-authorize claims. "That is the remedy," Fikes says. "I think we can agree that Medicare's not preauthorizing claims is what perpetrated all this." Sorensen is asking Medicare patients frustrated by documentation delays to sign a petition-there's one in each of his offices-that says the documentation burden is affecting their quality of care. With enough signatures in a short span of time, he hopes to approach a local congressperson with evidence of the gravity of the situation.

Representatives Tammy Duckworth (D-IL) and Brett Guthrie (R-KY) authored a letter, which was also signed by 33 other members of Congress, to HHS Secretary Kathleen Sebelius, advising her of the situation and requesting her aid in reassessing and developing other alternatives to the RAC audit program.

There are numerous cases of individual business owners approaching their congressmen and women and getting action. Results, however, may be a different story.

Fleetwood reports a disheartening response from a representative who was willing to write a letter to CMS, but who added, "I don't think it will do any good. We try to work with CMS, but they do what they want to."

There are a number of other possibilities for relieving the destructive audit pressures on O&P businesses. Many suggest implementing a pre-authorization process or re-addressing the K-level structure either by eliminating or replacing it or by defining the levels more clearly.

Some, like Brian Kaluf, CP, who practices in the Greenville, South Carolina, Ability Prosthetics & Orthotics patient care facility, worry that while emphasis is being placed on K-levels, not enough attention is paid to measuring patient utilization of delivered devices. Where's the value in a high-tech device that could be used-but isn't? But all of these options and concerns require CMS' willingness to approach the table with an intent to improve matters for struggling professionals and patients-and that willingness has so far been lacking, sources unanimously indicate.

Strategy 3: Get Better at Understanding and Following Rules

Under any imaginable reimbursement circumstances, there must be rules for filing claims, and if rules exist, they must be followed.

Thomas points out that in view of the value of the claims received, and an increase in the amount the government is spending on prosthetic care, despite a decrease in the number of beneficiaries with amputations in the past few years, Medicare's decision to make sure requirements are met and documentation is in place before it provides coverage and pays for prostheses should not be unexpected.

Gustin agrees. "While I'm somewhat sympathetic to the plight of individual practitioners because they need more specifics about CMS expectations," he says, "I'm also sympathetic to the plight of CMS and others trying to rein in healthcare costs. Have they really been getting the value they are paying for? And this is all they are asking for. The problem is O&P has not been able to show its comparative value over time. O&P must answer the question, 'What do we prevent in the greater scope of managing a specific patient population?' in order to show value.

"O&P practitioners have run our businesses essentially the same way for 150 years, but the focus of the industry must change from device-centric to patient-centric. Today's technology gives us all access to the same componentry and raw materials, so the expectation from the payer side is all devices are essentially the same. What differentiates one practitioner from another is not necessarily how well they make the device, but the decision-making process behind their choice of which device to fit for an individual.

Gustin continues, "Your ability to document- the 'why of the what'-is what matters to the payer-not just what was done for the patient and when it was done. Why did the patient need what you provided is the key."

"What we've done in the past was backwards," observes Dennis Clark, CPO, president, Orthotic and Prosthetic Group of American (OPGA), Waterloo, Iowa. "Under the new system, we should work with the physician and therapist in advance so we have all the documentation and compliance information in hand along with a detailed prescription when the patient walks in the door. Otherwise, we're spending time and effort, and frankly profit, paying for the same 'real estate' twice, while causing hardship on our referral sources, delaying patient care, and, worst of all, running the risk of delivering substandard care."

But getting cooperation from physicians has been historically problematic.

Strategy 4: Dealing with Physicians

History repeats itself, notes Dennis Janisse, CPed, president and CEO of National Pedorthic Services, headquartered in Milwaukee, Wisconsin. Pedorthic providers sustained immense losses due to audits performed on pedorthic claims as a result of the 1993 Medicare Therapeutic Shoe Bill, and Janisse recalls that then, as now, the problem was a lack of appropriate documentation confirming medical necessity. "The prescription had to be written by an MD [medical doctor], a DO [doctor of osteopathic medicine], or a DPM [doctor of podiatric medicine], but the certificate of medical need came from the physician who was managing the [patient's] diabetes, not necessarily the person who was prescribing, and that was where the big deficit was," he explains.

Despite collaborative efforts from AOPA, the Pedorthic Footcare Association (PFA), the National Community Pharmacy Association (NCPA), and the American Association of Diabetic Educators (AADE) in drafting a joint letter to Medicare-and ultimately an admission from Medicare that maybe it picked the wrong physician for the documentation, says Janisse, "in the end it didn't go anywhere; Medicare did nothing to correct it."

So perhaps it's best to be proactively compliant. "Long before CMS ramped up their audits," Jeff Brandt, CPO, CEO and president of Ability Prosthetics & Orthotics, headquartered in Exton, Pennsylvania, says, "we would request a copy of the physician's notes on a new patient. If the clinicals are poor, we can only tell the patient that their doctor didn't adequately document the need for a prosthesis per the LCD [local coverage determination] and supplier manual and send them back to the physician with a data sheet explaining K-levels and various outcomes-based tests they can document."

Brandt has gone as far as to suggest to CMS that perhaps it should recoup the money for the physician's office visit when the physician's notes are inadequate.

If CMS truly wants the process to change, it needs to educate the physicians and recognize prosthetists as healthcare providers. Although a prosthetist cannot write documentation for the physician, a certain amount of "coaching" is acceptable, Gustin says. "If they agree with the prosthetist's input, the physician can enter an addendum into the patient's record acknowledging the prosthetist's request for more detailed patient information and providing it as such through their EMR [electronic medical record] system. Although this may take a lot of time and effort, it's also an opportunity for the O&P facility to develop a stronger relationship with their referral sources."

Practitioners interviewed say that some physicians they have worked with, however, actually prefer the alternative solution some sources recommended: Rather than asking the referring physician for better documentation, practitioners should develop relationships with a physical medicine and rehabilitation (PM&R) physician.

"These are great professionals to assist us in assigning function levels and evaluating function and K-levels," Roger Marzano, CPO, CPed, vice president of clinical services, Yanke Bionics, headquartered in Akron, Ohio, says. "Not all physicians are enamored of you taking their patient and putting him in the hands of another doctor, but if they don't want to take the time to properly assess and evaluate the amputee's needs and classification level, then we have to find someone that will."

Sorensen agrees and advises practitioners to find physicians to whom you can send a patient for a prosthetic or orthotic consultation when appropriate documentation is needed.

"Educate those doctors regarding what Medicare is doing and why we need to align ourselves with some physicians who will take the time to do the kind of documentation that we need to be able to take care of our patients." Some physicians are willing to develop the relationship in order to increase their own referrals, he notes.

This is especially true in view of the recently unveiled Lower Limb Prosthesis Electronic Clinical Template from CMS-a four-page form that Gustin characterizes as "onerous" relative to the amount of information requested from the physician concerning the patient's overall condition.

"It's going to bring back the concept of an amputee clinic, with a very astute prosthetist and a very willing PM&R physician. Perhaps this is an efficient means for us to see a number of amputees at one specified period of time, in order to comply with this documentation requirement," he suggests.

Fikes has successfully worked with a physical therapy group that developed a software package that allows it to perform a functional analysis and provide it in a comprehensive eight-page report that the requesting physician has only to read, sign, and enter into his patient's medical record. "When I get an amputee patient from a doctor, I'll send the long prescription back to them with a request for functional analysis from Optimal Physical Therapy, Mesa, Arizona. The patient goes through the analysis, and the doctor prescribes what the therapy group recommends," explains Fikes, "so his notes are now impeccable."

Strategy 5: Become a Compliance Expert-or Get Help

If you're not meticulous by nature, hire someone who is. Regardless of protestations regarding CMS' "ex post facto" auditing of three-year-old claims, Thomas points out that it is a different story going forward. "Providers now have notice that Medicare is going to require a heightened level of physician documentation on current and future claims, and that is likely to cascade down from Medicare to other payers, so you're ultimately going to have to improve documentation whether or not you provide services to Medicare. I believe documentation has improved already, although that is difficult to measure."

The choice is between hiring an on-staff compliance expert or a consultant, or doing it yourself. If you are going it alone, talk to your manufacturer partners who have resources designed to help.

Ottobock has developed a documentation checklist that has proven successful for customers, says Kimberly Hanson, director of reimbursement-North America, Ottobock, Minneapolis, Minnesota, who notes that the tool is effective enough to be chosen by business auditing professionals, as well. For an additional fee, Ottobock also offers expanded reimbursement support in the form of consultation on medical reviews, appeals, and chart reviews. This independent, objective analysis of the medical record can spotlight gaps and weaknesses in the documentation.

Although Freedom Innovations, Irvine, California, does not have an in-house department to assist customers, Rob Cripe, senior vice president of global marketing, explains that the company has engaged its consultant, Sorensen, to offer a series of sponsored webinars dealing with the full range of coding and reimbursement issues.

Dave McGill, JD, vice president of legal affairs, Össur Americas, Foothill Ranch, California, points to Össur's menu of reimbursement support services, which ranges from its reimbursement specialists presenting at state and regional meetings, to in-person and online seminars, to its new comprehensive appeals workshop. It also includes Össur's online reimbursement and regulatory bulletin, Össur R&R, which is updated regularly with breaking news-twice a week on average.

Össur's newest addition to its reimbursement support list is its partnership with Harrington Management Group (HMG), headquartered in Canton, Ohio, to provide claims certification service built around Össur's bionic products. For a fee, HMG is available to review reimbursement claims and scrutinize documentation and notes for completeness, accuracy, and appropriateness, providing appeals support through the Administrative Law Judge (ALJ) appeal stage, if needed.

Although RAC audits appear to be focusing primarily on lower-limb prostheses, and Touch Bionics, headquartered in Livingston, Scotland, reports incremental sales growth rather than a decline, CEO Ian Stevens observes that the process of obtaining reimbursement authorization has become increasingly difficult and lengthier in the last year. "We suspect that the apprehension surrounding potential RAC audits has made clinicians more cautious about fitting higher-value devices," he says.

Touch Bionics' expert reimbursement support at all levels of the insurance claims process includes the Patient Care Pathway (PCP), which is a secure, online portal that allows clinicians to track patient outcomes, as well as a patient treatment plan template that may be included along with the documentation required for the insurance authorization process.

Strategy 6: Don't Run Away from a Fair Fight

"People are not as familiar as they should be with the formal appeals process for Medicare denials and overpayments. Practitioners need to use this course of action in order to voice their reasons on why they selected the product they did and billed it accordingly," says Hanson.

Although estimates vary by source, Gustin notes that 47 percent of healthcare providers in general appeal to the ALJ level and have an 80-90 percent success rate. "People need to understand that the administrative law judge is not an employee of CMS, and makes a decision based on reason rather than policy," he says. "The practitioner's role will be one of a patient advocate rather than as a maker of a device."

Strategy 7: Becoming Fast, Flexible, and Creative

Sources interviewed for this article urged networking and sharing experiences. "People love banding together against a common enemy, and they really love it when the common enemy is a behemoth," says Clark.

Gustin advises trying to think in the same language as those questioning your claims. "Packing up 35 pages of medical records, sending it as a response to specific questions, and expecting the recipient to understand it is a leap of faith. They don't know how, nor do they have the time, to read through this material and link it to their request. Fair or unfair, this is the reality.

"It's your responsibility to be clear. Link your response to each question. Highlight or reference in order to make it clear to whomever opens the envelope [that] the information requested is on page 13, exhibit A, etc."

If appeals run more than 120 days, Brandt actually pursues sending practitioner and patient to the insurance company's headquarters for an in-person hearing with the company's medical director. "We present our case study, showing them the tattered condition of an eight-year-old leg, and they typically approve it on the spot," says Brandt. "It would be better if we could waive the first 90 days of wasted time and go straight to the hearing to present our case because the delay is just not fair to the patient."

Kaluf offers additional encouragement for a profession-wide commitment to working through the audit crisis: "I'm a young practitioner, and I'm going to be working in the field for a lifetime; I've got a lot of years ahead of me. It behooves me to try to help right the ship early because if I hope to have a long career and serve patients in the best way and for the longest time possible, we've got to get it right-now."

"The reality," McGill says, "is that audits and prepayment claim reviews are part of normal business operations in prosthetics and orthotics in a way that they never have been historically, and that is, in my view, the new normal."

Judith Philipps Otto is a freelance writer who has assisted with marketing and public relations for various clients in the O&P profession. She has been a newspaper writer and editor and has won national and international awards as a broadcast writer-producer.