HCA Meets with OMIG on TPL Concerns Severely Complicated by Medicare Payment Changes

Situation Report | April 5, 2021

HCA met last week with the new Medicaid Inspector General Frank Walsh, his staff, and his office’s Third Party Liability (TPL) contractor to voice concerns about the state’s TPL appeals initiative going forward.

HCA was represented by President and CEO Al Cardillo and Vice President for Finance and Management Patrick Conole.

The Issue

As reported in last week’s Situation Report, HCA has serious concerns with the negative impact that Medicare home health payment changes will have on the demand-billing process that the Office of the Medicaid Inspector General (OMIG) requires of Certified Home Health Agencies (CHHAs) for TPL purposes.

The issue specifically stems from the federal phase-out of Requests for Anticipated Payment (RAPs) and a new five-day submission requirement (with payment penalties for late submissions) that was implemented by the U.S. Centers for Medicare and Medicaid Services (CMS) beginning January 1, 2021.

Due to this change, OMIG’s TPL contractor, the University of Massachusetts Medical School (UMMS), told HCA in a March 24 e-mail that CHHAs should be submitting no-pay RAPs for all dual-eligible beneficiary claims with dates of service beginning on or after January 1, 2021 — even if the final claim is not intended to be billed to Medicare. This is a significant departure from OMIG’s TPL demand-billing process that been in place for 15 to 20 years.

Traditionally, CHHAs would not submit a RAP to Medicare for TPL purposes until a paid Medicaid claim was later selected by OMIG and UMMS with a request that the CHHA demand-bill the claim to Medicare — which was normally 8 to 9 months after the original start of care (SOC) or admission date. This would occur in cases where a CHHA had previously rendered services to a dual-eligible beneficiary and had made the determination that the beneficiary did not meet the Medicare criteria for home care (not homebound or no skilled need) and so billed Medicaid.

The introduction of no-pay RAPs and new timely submission requirements, however, has severely complicated this process.

Because of this significant policy change, HCA made several requests of OMIG in our meeting, as outlined below.

Officially inform CHHAs of the new procedure

A letter should be sent by OMIG/UMMS to every CHHA explaining or outlining this new policy change. OMIG and UMMS should instruct CHHAs that the new OMIG-UMMS TPL procedure calls for CHHAs to submit no-pay RAPs to Medicare within 5 days of admission for all dual-eligible beneficiaries with dates of service beginning on or after January 1, 2021 — even in cases where the CHHA determines the dual-eligible beneficiary does not meet the Medicare home health criteria and the CHHA intends to bill Medicaid instead.

Hold CHHAs harmless for periods when they were unaware of the new procedures

OMIG must also refrain from penalizing CHHAs (i.e., not recouping previously paid Medicaid claims) if the CHHAs did not submit no-pay RAPs to Medicare timely for TPL appeal cases involving claims between January 1, 2021 through March 31, 2021. The new TPL policy change, involving no-pay RAPs, was only first communicated to HCA and CHHAs on March 24, 2021 — long after a CHHA could have met the no-pay RAP and timely submission requirement for this earlier period.

This assurance should be stated in OMIG’s next demand-bill notification letter to CHHAs, which is expected in August or September and would include TPL case requests for the period when CHHAs would not have known about the new requirements. Not only were CHHAs unaware of this significant policy change in the first quarter of the calendar year, but submitting a no-pay RAP for that period now would result in a denial of the entire 30-day Medicare episode payment — either to the CHHA directly or to OMIG via the demand bill process — because the timely submission deadline after start of care would have long expired.

Advocate for a simpler process

OMIG should also partner with HCA in advocating that CMS, under the new Biden Administration, reinstate New York’s TPL Demonstration Project which was discontinued in 2010.

This project (which was effective from 2003 to 2009) offered a fair and efficient claims-sampling appeals method to retrospectively determine which program, Medicare or Medicaid, was responsible for covering home health services already billed by CHHAs on behalf of dual-eligible beneficiaries instead of a demand-billing process that has long been administratively onerous and is now exponentially more complicated by the no-pay RAP requirements.

Specifically, the TPL demo randomly selected 215 to 220 dual-eligible cases each federal fiscal year that were previously billed and paid by Medicaid. Those cases where Medicare was determined to be the appropriate payor were then extrapolated across the entire universe of dual-eligible cases for that specific FFY and CMS made payments to OMIG directly in a far less administratively burdensome process for all involved.

HCA will update our CHHA members upon the OMIG’s response to our requests or as additional information becomes available.