Understanding Inpatient Cost Outlier Claims Ask-the-Contractor Teleconference (ACT) Moderator: Karen Kroupa April 29, 2015 1:00 pm CT/2:00 pm ET Operator: This is Conference #: 29142493 (Good morning). My name is (Kia) and I will be your conference operator today. At this time, I would like to welcome everyone to the Understanding Inpatient Cost Outlier Claims Teleconference. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. Ms. Kroupa, you may begin your conference. Thank you, (Kia). Welcome to the WPS Medicare Ask the Contractor Teleconference on Understanding Inpatient Cost Outlier Claims. My name is Karen Kroupa, and I am an outreach analyst on the Provider, Outreach, and Education team. I m joined today by other members of my team and also by members of other departments who will be assisting in the question-andanswer portion of the call. I d like to thank them all for joining us this afternoon. During today s teleconference, we will be discussing inpatient outlier claims focusing on defining the terms used when talking about outliers, why and when claims become outliers, and then talk about some tips on what to do to move an outlier claim through the claims system. The topic of today s call is intended for Part A providers billing claims under the Inpatient Prospective Payment System, otherwise known as the IPPS. Today s presentation and question-and-answer session is being recorded by InterCall. A recording of the call and a transcript will be posted to the WPS Medicare website on both the J5 and the J8 On-Demand Training pages. As 05/07/2015 http://www.wpsmedicare.com/index.shtml 1
a quick reminder, I encourage all of our listeners to visit our On Demand Training page as often as possible as it has a wide variety of Medicare educational offerings. After the formal presentation, we ll open the phone lines for questions. Our operator, (Kia), will give instructions on how to ask the question at that time. We cannot discuss specific claims situations due to privacy constraints and the fact we do not have access to claims to the claims processing system. Therefore, we cannot look at any claims. However, we will address questions about the inpatient cost outlier process. Questions about specific claims should be referred to the customer service line as they have access to the claims processing system and can look at the claim with you. So let s get started with today s topic. This training addresses what happens when the cost of the claim exceeds the MS-DRG payment assigned to it. When this occurs, the claim is a cost outlier claim. The topic of cost outlier claims may be daunting and mysterious when first encountered, a little like trying to decipher Egyptian hieroglyphics if you re not familiar with them. The first step in understanding how a cost outlier claim is processed is learning some of the acronyms and terms commonly used by the Medicare program when outliers are discussed. Some of the acronyms and abbreviations used in this training will be CWF, which means the Common Working File. This is the master record that keeps track of Medicare beneficiary information including benefit period information. FISS or F-I-S-S is the Fiscal Intermediary Standard System. This is a system the computer system that processes Medicare Part A claims. IPPS, of course, is the Inpatient Prospective Payment System. This is the payment system regulating the processing and payment of acute inpatient Part A claims. LTR Day is a Lifetime Reserve Day. These days are a set of 60 lifetime co-insurance days that each Medicare beneficiary has access to. Unlike the regular co-insurance days, the LTR days are not regenerated at the beginning of a new benefit period; hence, the term lifetime reserve day. The beneficiary pays a higher co-insurance than the renewable co-insurance days. 05/07/2015 http://www.wpsmedicare.com/index.shtml 2
MS-DRG stands for the Medicare Severity Diagnostic Related Group. IPPS claims are not paid on a per diem or daily basis. Information on an inpatient claim is used to assign the claim to an MS-DRG. In most cases, the MS- DRG payment assigned to a claim determines the global payment for the inpatient stay. Those are the acronyms we will be using. Now, let s define some of the terms that are used when speaking about IPPS billing that you might hear and use but may not know exactly what we mean by them. Benefit period, a benefit period is the period of time defining a Medicare beneficiary inpatient benefits. Co-insurance day is a day in a Medicare inpatient benefit period when the beneficiary is liable for a part of the inpatient Part A payment to a provider. Cost outlier. This is an additional payment that represents the portion of a hospital claim that exceeds the claims cost covered by the MS-DRG payment. Cost report. Cost report is a report required from providers that is used by CMS on an annual basis to determine Medicare reimbursement. Cost outlier threshold. The dollar amount that a claim has to exceed to receive an outlier payment. Inlier. This is a period of time that includes fully paid benefit days, coinsurance days and/or the days after benefit days exhaust. These days are all covered by the MS-DRG payment. The inlier portion of the claim will receive the entire MS-DRG payment even if there is only one co-insurance day left in a benefit period. The inlier period of the claim lasts until the outlier cost threshold is reached. Inlier day. This is a day within the inlier period, again, either full or coinsurance days, or could be a benefit exhaust day. Non-utilization day. This is a day within an inlier period that is after the last co-insurance day but before the cost outlier threshold. Non-utilization days are covered by the MS-DRG payment but are not counted against the 05/07/2015 http://www.wpsmedicare.com/index.shtml 3
beneficiaries benefit period since there are no full or co-insurance days left to count. An outlier is defined as an additional payment made by Medicare for high dollar claims. CMS recognizes that in some limited circumstances the cost of treating a beneficiary may be more than the reimbursement of particular MS- DRG may pay. So to help hospitals recover the higher cost of treating beneficiaries in these situations, Medicare will pay an outlier payment to cover more of the expense exceeding the MS-DRG payment. An outlier day is a day that falls within the outlier period of a claim and is paid by the outlier payment. A utilization day; this is a day that uses a benefit period day and is counted on the common working file. So, just as defined, let s look at cost outlier claims briefly. A cost outlier payment is an additional payment that represents the portion of a hospital claim that exceeds the cost covered by the MS-DRG. This additional payment is based on the cost of the claim that exceeds the cost outlier threshold. The Medicare contractor using the Pricer determines whether a claim qualifies for a high cost outlier payment. The contractor takes into account the operating and capital cost of providing a service and the MS- DRG payment when determined it determining the cost outlier threshold. Other things also factor into the equation such as the Area Wage Index and the Capital Geographic Adjustment Factor. The operating and capital cost must exceed the cost outlier threshold to qualify as a high-cost outlier claim. Once the cost outlier threshold for a claim has been exceeded, lifetime reserve days may be used if no regular or coinsurance hospital days remain. If no lifetime reserve days remain or if they exhaust during the outlier period, the hospital may charge for all days after benefits are exhausted. It s important to remember that the charges on a claim are also used in a formula to determine if an outlier payment can be made. Therefore, providers need to post all charges to the claim. Your Remittance Advice, your RA or 05/07/2015 http://www.wpsmedicare.com/index.shtml 4
Electronic Remittance Advice, the ERA, contains a field that will display any outlier payment included in the payment for the claim. Next, let s go over some of the codes found on outlier claim and what those codes indicate. First, condition code 61, condition code 61 indicates that the claim is an outlier claim. This code is not entered into the claim by the provider but it is entered by the Fiscal Intermediary Standard System or FISS. Occurrence Code A3. This is the last day of a payable Medicare Day; sometimes referred to as the benefits exhaust date. This date may be entered by the provider. However, keep in mind that as claims and adjustments post to common working file, the A3 date may change. When entering the A3 occurrence code, it s advisable to double check the benefit period information. Days the beneficiary had at the time of admission may or may not still be available at the time of billing. Occurrence Code 47. This is the day after the cost threshold has been reached. The provider will need to add the charges on a claim day by day to determine when the threshold is met. A Medicare contractor will not be able to determine this date for a provider. Occurrence Span Code 70. This indicates non-utilization days. Now, these are days in the inlier period of a claim between the last coinsurance day and the cost threshold day. Although the Occurrence Span Code 70 dates are beyond the last covered coinsurance day, they are still covered by the MS- DRG payment. Remember, the MS-DRG covers the inlier period even if a beneficiary has only one coinsurance day left at admission. Finally, Value Code 17 indicates the outlier payment. This amount is calculated and entered by the FISS system. OK, now, let s look at the diagram of the cost outlier claim. Looking at page 4 on your handout, you see the top bracket in red indicates the entire date span of the claim. IPPS claims are always billed admit through discharge. The inlier period of the claim is shown in green. Remember the inlier period can only be comprised of full and coinsurance day. The inlier period is paid with the MS-DRG payment because IPPS claim are paid a bundle payment. The 05/07/2015 http://www.wpsmedicare.com/index.shtml 5
full MS-DRG payment can be made even if the beneficiary has only one coinsurance day left in their benefit period. The inlier period never combines full and/or coinsurance days with lifetime reserve days. Moving on to the next diagram on page 5, the inlier period is determined by the date a high-cost claim reaches the cost threshold for the claim MS-DRG. On the diagram, the cost outlier threshold is indicated by the black line on the right side of the inlier period. The threshold is the dollar amount that a claim has to exceed to receive an outlier payment. As mentioned before, the provider must track charges to determine the dates a claim reaches the highcost outlier threshold. Moving on to the diagram on page 6, in the inlier period of the diagram, you now see a line indicating the date coinsurance days exhaust. Remember, if all of the beneficiary s co, full and coinsurance days have been utilized, the full MS-DRG payment still covers any additional days until the outlier threshold is reached. Again, the black line to the right indicates when the outlier threshold is met. The 70 occurrence span code represents the days after the last coinsurance day through the cost outlier threshold day. These are billed as non-utilization days for benefit period purposes but considered covered and paid cost report days on your remittance advise. On page 7, you see the outlier period of the claim indicated in the diagram by the blue box to the right. The provider indicates the first day of the outlier period with the 47 occurrence span code, the day the claim exceeded the cost outlier threshold. Lifetime reserve days may now be used unless the beneficiary chooses not to use them or in the rare circumstance in which the LTR coinsurance dollar amount is more than the beneficiary would owe for the days in the outlier period. If there are no lifetime reserve days available or not enough to cover the entire outlier period, the claim would go into a benefits exhaust status and the beneficiary or a secondary payer would be responsible for payment. Now, let s talk briefly about what to do if you have a claim that is an inpatient cost outlier. Because of the nature of outlier claim, they may receive errors as they move to the FIS systems drivers and have to be worked more than 05/07/2015 http://www.wpsmedicare.com/index.shtml 6
once. A driver is a part of the claim processing program that verifies specific pieces of information on a claim. If the specific piece of information that a particular driver is checking is correct, the claim moves on to the next driver which verifies a different piece of information on the claim. This process is repeated until the claim clears all those drivers and finishes its processing. If a driver finds an error in the particular piece of information that it verifies, the claim is returned to the provider for correction. So, different drivers look for different pieces of information. This is why you may correct the claim only to have it hit an error for another reason code as it moves to the system and this is very common for inpatient outlier claims. So remember that benefit period information may change at anytime on common working files as a various claims are posted. Another provider s claim that post may change the benefit date information required on your outlier claim before your claim finishes processing. It s not always possible to account for all the days that may or may not be used by other claims, but trying to ascertain prior inpatient claim history may help avoid mistakes. Common working file assigns benefit days to claims on a first in, first out basis and this cannot be altered; so before working an error, double checking the benefit days on common working files for any changes that might have occurred is advisable. Another thing to be aware of is providers must track their charges day by day to be able to tell when a claim reaches the cost outlier threshold. Now, this is something that your contractor cannot do for you as we mentioned before. If providers have questions regarding what a claim cost outlier is, they can look under the DRG Pricer page in the Direct Data Entry (DDE) system for the cost outlier amount assigned to that claim. So now, we are at the question-and-answer portion of our call. Remember, we can take general questions about the inpatient cost outlier billing process but we cannot discuss specific claim situations. If you have a question regarding specific claim, please call customer service department so they can look at that claim with you. And, (Kia), will you remind our listeners how to ask a question? 05/07/2015 http://www.wpsmedicare.com/index.shtml 7
Operator: At this time I would like to remind everyone in order to ask a question, press star then the number one on your telephone keypad. We ll pause for just a moment to compile the Q&A roster. Your first question comes from the line of (Donna Seely). Female: Hi, Karen. Hi. I have a question about the cost outlier versus the day outlier. Are there still day outliers in the Medicare system? No, there are not day outliers any longer. Are you an LTAC? No just acute care. (Crosstalk) Oh go ahead. Did they go away with the MS-DRGs or was that before that? They haven't been around for a while. I don t remember exactly when, its been a few years. OK. And can you speak a little bit again about in identifying the cost outlier for a particular DRG you can look at what to find that? In the DDE system, there is a page. And your screens are different than ours. So on the provider screens I don t know which page it is. But it s the DRG pricer page and there should be a field that will tell you for that claim what the cost outlier threshold is. OK and would we use our charges to figure out if we re in outlier or would it 05/07/2015 http://www.wpsmedicare.com/index.shtml 8
Operator: (David Dower): Yes. It would be the charges, OK. Right, you just add them up day by day, and we can't do that because on an inpatient claim, you know, there aren t the dates, so it s something you have to track. OK. And I do have one more question. Could I ask a second one? Sure. OK. This isn t specifically in regards to outliers but I have a question about lifetime reserve days. If the co-insurance days if the patient doesn t have any lifetime reserve days left, I know that they re done. Once they re gone, they re gone but if they are out of care for long enough, do their co-insurance days renew even if they don t have lifetime reserve days available? Yes. They do? OK. They will after your 60-day break, your co-insurance days will renew. OK, very good. Thank you. Thank you, (Donna). Your next question comes from the line of (David Dower). Hi, David. Hello. Hi, this is (Pam) from the University of Iowa Hospitals and Clinics. Our question is if a patient exhausts during a stay, there seems to be some information misinformation back and forth that we to submit an exhaust claim, we would only be able to submit that exhaust claim if the patient had hit the outlier dollars. Is that correct? Or if the patient has exhausted during 05/07/2015 http://www.wpsmedicare.com/index.shtml 9
a stay, can we submit do we submit an ancillary claim whether they re HIPAA outlier or not cause we ve heard it (straight) from Medicare. OK, unless they re exhausted at the beginning of a stay, you wouldn t have to send a benefits exhaust claim. And repeat the second part of your question, I just want to make sure I understand it. The patient has exhausted prior to stay. We know that we submit an exhaust claim. That we understand. The misinformation that we keep getting is if the patient has exhausted during a stay, our practice has always been and we ve been told we would submit an ancillary claim for the exhausted portion of that stay whether they hit an outlier or not. But then we hear it the other way, where you only would submit an ancillary claim if the patient hits an outlier. Well The clarification on which way it is supposed to be. If they have remember, if it s paid by the MS-DRG Right. if they have one day, the inlier period would be paid, you know, by the DRG. It s a bundled payment. Now, so they ll get the full DRG payment. If they exhaust after cost outlier threshold and they re in the outlier period, that s a different story because then they would be liable for the days past their exhausting. So if we if they were partially exhausted and they did not hit a cost outlier, we are actually getting payment on the DRG for the whole all the charges. Right, right. Because it is a bundled charge. But if they hit that, if they hit the cost outlier, then we would go ahead and submit an ancillary claim. Right. After their day, after their last benefit day had been used up. OK. 05/07/2015 http://www.wpsmedicare.com/index.shtml 10
(Rachel): (Rachel): (Rachel): Operator: Then you can submit. That s right. This is (Rachel) in Omaha and it is in an actual MLN article. It s (SE1310) that does explain all of that. (SE1310)? That s correct. OK. All right, thank you. You re welcome. Your next question comes from (Karen Pattison). OK, hello, (Karen). (Karen Pattison): Hello. Hi. My question is do providers have to have permission from the beneficiaries to utilize their lifetime reserve days? Do we have to have their permission to utilize them or? You know, it s just the opposite of what you would think. You actually have to have their permission not to use them. And the only time I can image they wouldn t want to use them is if they knew the cost of the day charge would be less than their lifetime co-insurance. (Karen Pattison): OK, so that s just been some miscommunications that we ve heard. So it s only if they choose for us not to? Correct. (Karen Pattison): OK. Otherwise, the system is going to start ticking them off automatically. (Karen Pattison): OK, so is there any place or any kind of recurrence code or anything that we have to show when they choose not to use them? Sixty-seven. 05/07/2015 http://www.wpsmedicare.com/index.shtml 11
(Karen Pattison): Oh (Crosstalk) Condition code. Condition Code 67. (Karen Pattison): Is that in the information that we have? I don t think I put Condition Code 67 (Karen Pattison): Oh OK. in the list of codes, but it would it should be in the inpatient billing manual. (Crosstalk) (Karen Pattison): OK. I just thought (Crosstalk) (Karen Pattison): information. Anything else? (Karen Pattison): No, that s all. Thank you. Operator: Again, if you would like to ask a question, press star then the one on your telephone keypad. Well, while we are waiting for questions, I d like to remind our providers to visit the WPS Medicare website as often as you can. And when you are there, if you receive the pop-up for the (ForeSee) survey, we d appreciate it if you take a few minutes to complete it. We really need your feedback to improve our website. Your provider comments and suggestions are really useful to us in updating and improving the website. We want to make it the best possible for our provider community. 05/07/2015 http://www.wpsmedicare.com/index.shtml 12
We are striving to bring you the best and most timely and useful information possible. And as an added bonus, if you do take the (ForeSee) survey, the pop-up for the survey will not return for 30 days. So, (Kia), is there any other question? Operator: Yes, there is one more question from the line of (Shannon Brown). Good afternoon, (Shannon). (Shannon Brown): Yes, could you clarify for me please the days that are reported in Occurrence Span Code 70 for the remainder of the inlier period? Are they to be reported in Value Code 80 or 81? And then to make sure do they also then get reported if they are in 81 as an uncovered day in the charges? It goes in an 81 value code but on the charges page it s covered. (Shannon Brown): OK, so the non-utilized days are noncovered days in Value Code 81 Yes. (Shannon Brown): but covered rooms on the charges. Yes. (Shannon Brown): OK. Since we re going to pay it. (Shannon Brown): OK, thank you. Operator: OK, thank you, (Shannon). There are no further questions at this time. All right. Well, if there are no more questions, I d like to thank you all for joining us for today s call. I ll be able to take questions on the topic for the next two weeks via email. And my e-mail address is karen.kroupa@wpsic.com. Remember, I cannot receive any e-mails with PII or PHI. So if you do have a specific claim to look at please contact the 05/07/2015 http://www.wpsmedicare.com/index.shtml 13
provider contact center for assistance in the customer service reps can help you. After two weeks you will have to contact the provider contact center. And with that I d like to wish you all a happy rest of the day, and this ends our call. Operator: This concludes today s conference call. You may now disconnect. 05/07/2015 http://www.wpsmedicare.com/index.shtml 14