Avoid common compliance pitfalls in outpatient PPS
Avoid common compliance pitfalls in outpatient PPS
Several important compliance issues relevant to hospitals are buried in the new outpatient prospective payment system (PPS), warns Timothy Blanchard, a health care attorney with McDermott, Will & Emery in Los Angeles.
The foundation of the new methodology is the ambulatory patient classification (APC) system for outpatient reimbursement. There are roughly 450 APC payment categories based on similar clinical and resource utilization classifications. That number will only increase as new technologies are developed over time.
One area that hospitals should pay close attention to is outpatient unbundling, warns Blanchard. Back when the inpatient PPS took effect, it was necessary for the Medicare program to make rules against unbundling or carving services out of the fixed DRG payment, Blanchard says. "The same sort of problem would occur if there was not a rule against unbundling outpatient services."
He also notes that the hospital’s provider agreement requires it to furnish directly or under arrangement most nonphysician services required by its patients.
"Failure to satisfy that rule would give rise to false claims exposure and violate a hospital’s provider agreement," he warns. "It is very important to focus on those issues."
There are exceptions to the nonphysician rule, however. Those include separately billable allied professionals, such as nurse practitioners, physician assistants, qualified psychologists, and certain skilled nursing and durable medical equipment providers.
According to Blanchard, among the compliance issues that arise when hospitals enter into "under-arrangement" contracts are the payment terms. There is also a question about how many of these under-arrangement suppliers a hospital is going to have, and that goes to the question of quality, says Blanchard. It also goes to questions of supervision and credentialing, he adds. That’s because one of the requirements for a valid under-arrangement agreement is that the hospital exercise the same sort of quality control, utilization review, and oversight that it would have exercised if it had furnished the service directly.
Some hospitals operate under the assumption that once they have contracted for those services, it is no longer their problem. "That is certainly not the case," says Blanchard. "I definitely think that we are going to see some additional reviews in the area of under-arrangement services."
Blanchard says it makes sense for hospitals to have a module in their quality assurance department to document that it has reviewed the services provided by outside contractors.
See the next issue of Compliance Hotline for common coding pitfalls under outpatient PPS.
Subscribe Now for Access
You have reached your article limit for the month. We hope you found our articles both enjoyable and insightful. For information on new subscriptions, product trials, alternative billing arrangements or group and site discounts please call 800-688-2421. We look forward to having you as a long-term member of the Relias Media community.