July 12, 2012

Connolly Receives CMS Approval for New Home Health Issue

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Connolly Healthcare, the Recovery Audit Contractor for Region C, has posted a new home health RAC issue. The issue will be included in Connolly’s automated edits, which going forward will look for RAP claims without corresponding final claims resulting in overpayments to home health agencies.

Home health agencies submit a request for anticipated payment (RAP) at the beginning of each 60-day episode of care for a patient. The agency receives a portion of each anticipated episodic payment, either 60 percent for an initial episode or 50 percent for subsequent episodes. An adjusted episode payment is received after submission of a final claim at the end of an episode. The adjusted sum is the payment due for the episode based on the final claim minus the amount paid on the RAP. When a home health agency does not submit a final claim within 120 days following the RAP submission, or within 60 days of the RAP payment, the RAPs are supposed to be recovered automatically by the Medicare Administrative Contractor (MAC). However, Connolly reports that research of Medicare claims revealed paid RAP claims that did not have corresponding home health final claims.

CMS reports that it is looking at those specific claims to determine why the system did not recoup the payments automatically. Regardless of the reason, agencies will be expected to pay back RAP amounts if no final claim is found in your MAC’s system. If your agency is located in Region C, you possibly can expect to receive demands for repayment of RAP amounts as a result of these automated reviews.

Home health agencies can limit the risks related to this issue by reviewing their billing process. The process should include auditing to confirm that a final claim is submitted and accepted by the MAC for each RAP, and that RAPs are canceled when no plans are made to submit a final claim for the episode. 

About the Author

Bonny Kohr, RN, CHCE, HCS-D, is the manager of clinical services for   FR &R Healthcare Consulting, Inc. She is a registered nurse, a certified homecare coding specialist and a certified homecare and hospice executive. Bonny worked 23 years in home health care, starting her career as a field staff nurse before becoming a clinical director and finally a chief operating officer. 

Contact the Author

BKohr@frrcpas.com

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Bonny Kohr, RN, CHCE, HCS-D

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