April 18, 2016

Problems with QIO Audits Revealed

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The user groups have been lighting up with talk about the BFCC-QIO audits of short stays. And, not surprisingly, it is a mess. As I previously reported, the Centers for Medicare & Medicaid Services (CMS) threw us a curve ball by allowing the Quality Integrity Organizations (QIOs) to go back to admissions as far as mid-year 2015 when they started their audits, after indicating in writing that only admissions after October 1 would be audited. Apparently CMS is not aware of the Internet Archive Wayback Machine that keeps a copy of web pages that are secretly changed in the dark of night, hoping to hide incriminating evidence (here is the page where CMS says only admissions after October 1, 2015 would be audited).

And once the audits started, the results were mixed. It appeared that many of the reviewers had a good grasp of the two-midnight rule, but others did not. The wording on the denial letters was a bit confusing, indicating on denials that the patient did not warrant inpatient level of care when what they should have said was the patient did not warrant inpatient hospital care. And, of course, many were quite distressed when CMS announced that having 3 of 10 charts denied would be considered a major concern when that threshold was 7 of 10 with the Medicare Administrative Contractor (MAC) audits. And a few people were offended when told that if their hospital got all 10 charts correct, they would still be classified as being a minor concern. What could it possibly take to be considered no concern, if 100 percent correct is minor?

Well, once we got over the distress over those issues, the next surprise came. Many hospitals have received their first round of audit results, but only a few have received their educational sessions. The QIOs explained that they were concentrating initial education on the hospitals with the higher denial rates; that seems to make sense, except for one glaring problem. Many of these denied charts are from May 2015, and if the hospital cannot get the denial overturned during the educational session, they only have one year from the date of admission to rebill for part B services. That rebill not be accepted until the denial from the QIO is processed by the MAC and posted, which does not happen overnight. So, in essence, unless the QIOs do all their education in the next week or two, none of these denied admissions from the first round of audits are eligible for rebilling. Granted, with 5 or 6 denied admissions, the amount at stake for any one hospital is probably around $10,000, but it is the principle more than the money that is of concern. As we all know, the auditors are regularly missing deadlines, and of course the ALJs are years past their 90-day mandated timeframe to review appeals. Nothing is ever done to them, so it will be interesting to see if CMS extends the rebilling deadline for these QIO audits, since the delay was completely due to CMS and the QIOs.

Then the next issue came up: While hospitals were waiting for their educations to be scheduled, they received their chart requests for the second round. Now, wait a minute—if the QIO audits are supposed to be educational and help hospitals improve their performance, what good is a second round if the hospital does not know what they did wrong on the first round and how to change their processes?

That leads to the next issue that was discussed—what leads to a referral to the Recovery Auditor (RA)? There were all kinds of things thrown out, but all we know is the QIOs will discuss with CMS any hospitals with high denial rates that did not improve with education. Does that mean the second round won’t count because it comes prior to education? Or maybe the first- and second-round results will be the baseline and compared to the third round, and if there is not improvement there will be a referral? We all have no idea.

Finally, one commenter suggested that it was ludicrous to refer a hospital to the RA based on a sample of 10 charts, noting that there cannot possibly be statistical significance with that small a sample size. But few hospitals would want to see the routine QIO audits increase to encompass a statistically significant sample size, since that puts more reimbursement at risk. The only other option would be to go back to allowing the RAs to freely audit short stay admissions, and that is not a solution that anyone wants to see. As long as CMS continues to see data suggesting that $29.6 billion are paid out improperly, we will continue to face audits, so let’s not look the QIO gift horse in the mouth.

I suspect that, like road construction, we will one day look back and say that the QIO rollout was not all that bad, but it sure is painful getting there. I may be preaching to the choir writing this critique on RACmonitor, but hopefully at least one person at CMS and at the QIOs will read this and take a second look at the issues hospitals have looming over them.

About the Author

Ronald Hirsch, MD, FACP, CHCQM, is vice president of the Regulations and Education Group at Accretive Physician Advisory Services at Accretive Health. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices, and he is a published author on the topic. He is a member of the Advisory Board of the American Case Management Association and a Fellow of the American College of Physicians. 

Contact the Author

RHirsch@accretivehealth.com

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