preparing for rac strengthen your denials management process
Download
Skip this Video
Download Presentation
Preparing for RAC ? Strengthen Your Denials Management Process

Loading in 2 Seconds...

play fullscreen
1 / 29

Preparing for RAC Strengthen Your Denials Management Process - PowerPoint PPT Presentation


  • 186 Views
  • Uploaded on

Preparing for RAC ? Strengthen Your Denials Management Process. December 19, 2008. Practical, Innovative, Medical Management Solutions. PREPARING FOR “ RAC ATTACK ”. Goal Develop a proactive attack plan to prevent financial risk for the organization Assemble a RAC Taskforce

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Preparing for RAC Strengthen Your Denials Management Process' - libitha


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
preparing for rac strengthen your denials management process

Preparing for RAC? Strengthen Your Denials Management Process

December 19, 2008

Practical, Innovative, Medical Management Solutions

preparing for rac attack

PREPARING FOR “RAC ATTACK”

Goal

Develop a proactive attack plan to prevent

financial risk for the organization

Assemble a RAC Taskforce

Interdisciplinary approach with core players:

Utilization Review

Medical Records

Risk and Outcomes Director

Patient Financial Services Director

Information Technology Representative

Physician Representative (in-house or contracted)

preparing for rac attack3
PREPARING FOR “RAC ATTACK”

Determining the Action Plan

  • Establish line of authority for hospital wide RAC program
  • Use existing data to analyze/identify denial drivers
  • Perform in-house audits and determine hospital wide and system weaknesses
  • Establish process improvement plans
  • Develop an interdepartmental tracking system
preparing for rac attack4
PREPARING FOR “RAC ATTACK”

In-House Physician Advisors

PROS

  • Decrease hospital expense
  • No contingency fees
  • Existing internal peer relationships

CONS

  • Increases existing physicians work load
  • Physician often not be specialized in denials management
  • Difficulty persuading others to embrace practice improvements
  • Limited ability to produce valuable educational reports and denial tracking reports
preparing for rac attack5
PREPARING FOR “RAC ATTACK”

Results Achieved: Denials Outsourcing

FYE 2005

- 29.54% of Total Cost denied

- 21.00% overturned after in-house appeal

FYE 2006

- 27.53% of Total Cost denied

- 44.90% recovered utilizing physician appeal

Summary

Significant Denials Decrease:

- 19.50% is the average recovery prior to program launch

- 29.00% is the sustained recoveries since 2006

preparing for rac attack6
PREPARING FOR “RAC ATTACK”

Demonstration Project RAC Statistics

  • 32% medical necessity denials
  • 42% incorrect coding denials
  • 9% insufficient clinical
  • 88% inpatient
  • 11% appealed
  • 5% overturned
  • 42% of hospitals had no denials issued
preparing for rac attack7
PREPARING FOR “RAC ATTACK”
  • Denials Increasing from Numerous Sources
      • CMS Denials
        • RAC Denials
        • Emergence of Medicare “Never Events” Denials
      • Increased Denials
        • Medicaid MCO’s
        • FFS Medicaid
        • Commercial Payors
  • Use RAC Preparations as Catalyst to Revamp your Denials Management Process
preparing for rac attack8
PREPARING FOR “RAC ATTACK”

Key Components of an Effective Denials Strategy

Primary Strategy - Proactive Prevention

  • Use data to identify key drivers of denials
  • Develop processes to mitigate these drivers thereby further reducing denials
  • Minimize denials through an effective Concurrent Review/Case Management and notification process

Supporting Strategy - Denials Recovery

  • Aggressive appeals process recover denied dollars
  • Close the loop between approval and payment
preparing for rac attack9
PREPARING FOR “RAC ATTACK”

Primary Strategy: Data Management

  • Audit existing data to identify opportunities for improvement including areas of RAC emphasis
  • Use audit results to develop processes that address identified areas of opportunity
  • Enhance existing UM/CM/SW processes based on audit findings
  • Develop educational sessions as needed
  • Re-assess and monitor impact of newly implemented processes
preparing for rac attack10
PREPARING FOR “RAC ATTACK”

Using Data to Identify Opportunities

Audit charts for each RAC area of emphasis

  • Objective chart review using CMS medical necessity criteria (InterQual)
  • Subjective chart review using physician medical judgment
  • Data capture and analysis of denial variables

Analyze audited data and existing denials data

  • Diagnosis
  • Physician
  • Denial type
  • Delay reason
preparing for rac attack11
PREPARING FOR “RAC ATTACK”

Denials Management Tracking and Audit Application

preparing for rac attack12
PREPARING FOR “RAC ATTACK”

Building Processes to Minimize Denials

  • Obtain buy in from key stake holders to improve chances of success

- Physicians, nursing, UM, IT

  • Prioritize process improvement to maximize returns
  • Select improvements with highest success rate

- Broadest impact across all payor types

- Simple implementation

        • Primarily systems enhancements
        • Minimal resource allocation

- Enhance and strengthen existing processes

preparing for rac attack13
PREPARING FOR “RAC ATTACK”

Building Processes to Minimize Denials

Examples of Process Improvement Activities

  • Short stay denials
      • RAC emphasis
  • UM/CM/SW process enhancements

- Improve communications with payors

  • Education

- Use data to identify educational activities for staff

- Employ external resources as needed

preparing for rac attack14
PREPARING FOR “RAC ATTACK”

Short Stay Denials

  • Case manager assigned to ER to review admissions for select diagnosis based on audit results
  • Consult done in ER when possible prior to admission
  • Consider implementing rapid chest pain protocol
  • Educate ER staff on admissions criteria for commonly denied diagnosis
preparing for rac attack15
PREPARING FOR “RAC ATTACK”

UM/CM Process Enhancements

  • Hold carriers to timely denial notification by denial log
  • Use log to eliminate denials for no clinical and to drive peer-to-peer process
  • Use denials audit results to focus case management and discharge planning activities
  • Work closely with payor case manager on complex cases
preparing for rac attack16
PREPARING FOR “RAC ATTACK”

Education

  • Use denial audit results to guide educational initiatives
  • Physician and UM/CM/SW educational sessions based on frequently denied diagnosis
  • Hospitalist groups respond positively with impressive end results
  • Individual physician improvements more difficult to accomplish
preparing for rac attack17
PREPARING FOR “RAC ATTACK”

Secondary Strategy Denials Recovery

Ensure processes are in place to maximize denied claims

recovery

  • Develop strong appeals capabilities
  • Ensure aggressive payment follow through
  • Ensure strong data capture and reporting capabilities
  • Use data to identify areas of opportunity to enhance the entire process
  • Close the loop on denials prevention CQI
preparing for rac attack18
PREPARING FOR “RAC ATTACK”

Advantages of Physician Led Appeals

  • Recognized as clinical expert vs other clinicians
  • Able to challenge payers and provide clinical conviction
  • Peer-to-peer review shown to prevent 15% of denials
  • RAC auditors must provide a physician for peer-to-peer when requested
  • Select payors now require a physicians’ name on the appeal
preparing for rac attack19
PREPARING FOR “RAC ATTACK”

The Appeal Process

Types of Appeals

  • Informal peer-to-peer as soon as denial is identified, 1 day of denial
  • First Level appeal with medical records, 15 to 180 days depending on payor
  • Second Level for some payors – typically 30 to 90 days
  • Third Level – for some payors – typically 30 to 90 days
  • External appeals - usually through the MIA or CMS

Complexity of Appeals

  • Multiple payors  Multiple rules
  • Multiple levels  Multiple time frames
  • Multiple regulators
preparing for rac attack20
PREPARING FOR “RAC ATTACK”

A Staged Approach to Appeals Management

Automation and

Data Management

Research & Approval Strategy Development

MCO Submission

Denial Mitigation through Education

MCO Process Management

Denial Process & Intervention Reporting

Payment Management Process

Appeal Response Determination Process

preparing for rac attack21
PREPARING FOR “RAC ATTACK”

Internal Appeals Process

  • A strong appeals process is critical in developing a successful denials mitigation program.
  • The components of a successful appeals process include:

- Identifying the denial as soon as possible

- Collecting medical necessity information

- Generating the appeals letter

- Managing the payor’s appeal response process

- Appeal response determination process

- Payment management process

- Data management, reporting and performance improvement

preparing for rac attack22
PREPARING FOR “RAC ATTACK”

Identifying the Denial

  • The EOB is the gold standard and should be cross referenced with other denial sources to ensure denials are correctly identified
  • For carriers with a short appeal response timeframe the denial must be identified before the EOB is received
  • Most denials are identified through the denial letter sent from the payor or phone calls
  • Payor’s daily log is a good source for identifying denials
preparing for rac attack23
PREPARING FOR “RAC ATTACK”

The Medical Necessity Argument

  • Critical components necessary for success
    • Timeliness is critical and requires a complex and efficient process to meet the varying requirements of numerous insurers.
    • Medical necessity knowledge is key to a successful appeal and often requires the leadership and input of a UM trained physician
    • Intimate knowledge of criteria sets (Milliman, InterQual etc.)
preparing for rac attack24
PREPARING FOR “RAC ATTACK”

Managing The Appeal Response Process

  • All appeals documentation must be:

- Sent by certified mail

- Tracking option activated

- Follow-up calls to facilitate return of late appeals

  • Payors fail to return 35% of initial appeals for a variety of reasons
  • Depending on the insurer, only 35% to 60% of appeals are completed within the required 30 days
  • Process difficult to monitor without an appeals tracking system
preparing for rac attack25
PREPARING FOR “RAC ATTACK”
  • Once an appeal response is received a decision must be made on next steps
  • If approved, clearly payment must be pursued
  • If denied:
      • Should a Level 2 or 3 be pursued?
      • Should the account be closed?
      • Should an external review be filed?
  • Between 10% to 25% of Level 2 or 3 appeals can be overturned
  • Significant medical necessity knowledge is needed to assess which appeals warrant a Level 2 or 3
preparing for rac attack26
PREPARING FOR “RAC ATTACK”

From Approval to Payment

  • Assign accountability for payment follow-up
  • Close the loop between approval and payment
  • Follow-up with payor to ensure 100% of approvals are paid
  • Pay close attention to TPA’s
preparing for rac attack27
PREPARING FOR “RAC ATTACK”

Data Management, Reporting and Performance Improvement

  • Provide monthly results to key players
  • Status reports provide updates on the appeals process
  • Actionable reports drive the CQI process
  • Monitor impact of process improvement activities with tracking and trending of data
preparing for rac attack28
PREPARING FOR “RAC ATTACK”

Summary

  • Preparation is key
  • Minimize operational disruptions … its just another denial
  • RAC demonstration – 42% of facilities had zero denials
  • Use the opportunity to enhance your denials management process … and come out ahead
  • Reporting and continuous process improvement are critical
case management covenants llc
Case Management Covenants, LLC

Case Management Covenants is a Maryland based

healthcare consulting services company specializing in

denial management, appeal management and RAC audit

preparation services.

Key Staff Contacts

President: Olakunle Olaniyan, M.D. – still a practicing physician and former managed care VP and CMO.

Chief Operations Officer: Iskla “Chris” Brown - nurse executive with many years experience in healthcare accreditation organizations, commercial and government health insurance entities.

Vice President, Business Development: Doug Allen – a strategic planning professional with significant experience in both the commercial and non-profit healthcare sectors.

410-715-4913

ad