Last month, we discussed Noridian’s findings from the IRF Probe Audit for Arizona conducted from December 21, 2015, through March 3, 2016. At that time, we agreed to provide the findings of a similar audit in the state of Oregon that reviewed 100 claims from November 23, 2015–March 11, 2016. The results of that probe were posted to the Noridian website on April 8, 2016, and are summarized below.

In this review, 100 claims were reviewed for the date ranges above. Only 48 claims were accepted, and 52 claims denied. The overall error rate—calculated by dividing the dollar amount of charges billed in error (minus any confirmed under-billed charges) by the total amount of charges for services medically reviewed—was 52 percent, significantly higher than the 30 percent calculated in the Arizona probe, and obviously high enough to trigger targeted review.

What Were the Common Reasons for Denial?

Noridian provided the following list of reasons for denial of the 52 claims:

  • Pre-admission screening was not completed and/or reviewed by qualified staff and/or rehabilitation physician within 48 hours prior to IRF admission.
  • Post-admission physician evaluation requirements for timeliness and completion by qualified staff were not met.
  • Interdisciplinary team conference requirements for attendees and/or frequency were not met.
  • Minimum therapy intensity requirements were not met.
  • Valid IRF admission order was not completed.
  • IRF-PAI (patient assessment instrument) was not documented for validation of claim coding.
  • Minimum intensity requirement for the qualified rehabilitation face-to-face visits were not met.
  • Medical necessity requirements for the admission were not met.
  • No medical records were received.

Why is this Troublesome?

What is most troublesome to us is the reasons for denial are almost identical to those for the previously reported Arizona probe and follow the pattern we have been seeing from Noridian and other MACs that have completed IRF reviews in recent years and, once again, demonstrate that IRFs continue to have difficulty assuring IRF documentation demonstrates the case meets the 1/1/2010 updated Medicare guidelines for reasonable and necessary care in an IRF.

With error rates consistently this high, IRFs can expect more and more scrutiny and continuing high rates of denial. And, as we mentioned in our article last month, most of the reasons for denial are preventable. With the exception of denials related to whether or not the care was reasonable and necessary/medically necessary, the majority of the denials are due to technical requirements not being met.

What Do We Recommend IRFs Do Now?

  • Review the table in last month’s article that includes Probe Review Denial Reasons and Recommended Strategies. IRFs must take a serious look at their policies and processes to assure the technical requirements for IRF coverage are met.
  • Appeal your denials.
  • If documentation was missing (or missed) from the first round of review, it is essential that organizations appeal those denials. Claims were denied for missing IRF-PAI documents that were obviously completed by the organization in order to generate a bill. Begin the appeals process early, and be organized.
  • Evaluate your resources.

­Determine whether you have the internal resources to support both the appeals process (which is critical) and the evaluation of your current policies and processes to assure the technical documentation requirements are met in order to prevent denials in the future. 

  • Develop a strategy.

Pull your leadership and clinical team together and develop an action plan to address these issues within your organization. Make the plan a written document with actions, timelines, and responsibilities so your team accepts the importance of this effort. Implement and monitor the plan as if the success of your IRF depends on it—it does! 

  • If appropriate, seek assistance.

Not all organizations need outside assistance, but many do. If you have been working on these issues for some time and have not been successful, it might be wise to get an external review of your processes, policies, strengths, and weaknesses in order to develop a plan that addresses all components of successful documentation for the Medicare requirements.

And, It’s Not Over…

Due to the high error rate posted for this service specific probe review, providers may be subjected to further target review. On April 20, Noridian updated its website and posted notification to IRF providers of the initiation of a Service Specific Targeted Review. Providers in Oregon can expect further Additional Documentation Requests (ADRs) as part of this targeted review and will continue to face audits based on the errors found in the Probe Review. 

About the Author

Angela M. Phillips, PT, is President & Chief Executive Officer of Images & Associates. A graduate of the University of Pennsylvania, School of Allied Health Professions, she has more than 35 years of experience as a consultant, healthcare executive, hospital administrator, educator and clinician. Ms. Phillips is one of the nation’s leading consultants assisting Inpatient Rehabilitation Facilities in operating effectively under the Medicare Prospective Payment System (PPS) and in addressing key issues related to compliance.

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