Institutional Cost Report (ICR), Disproportionate Share Hospital...

Institutional Cost Report (ICR), Disproportionate Share Hospital (DSH), and Health Care Reform Act (HCRA) Performance Audit Updates

February 1, 2017

Presentation to the Healthcare Financial Management Association

2© 2016 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 577708

With you todayKPMG LLP (KPMG)— May Boucherak, Director

— Anthony Trapasso, Director

— Joseph Cassano, Manager

— Jared Gogel, Senior Associate

— Matthew Unnasch, Senior Associate

— Evan Lehman, Senior Associate

— Derek Zielinski, Senior Associate




Agenda and objectives

Notice: The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

ICR Audit Updates

DSH/ICR Timeline and Tool Update01

02

DSH Audit Updates03

Outreach program

HCRA Audit Updates04

05

ICR/DSH Timeline and Tool Update


2015 ICR and 2013 DSH Audit tentative timeline*ICR/DSH Timeline and Tool Update

October 2016 November 2016 December 2016 January 2017 February 2017 March 2017 April 2017

ICR Tool Submission

DSH Tool Submission

Pause on ICR – No Follow-ups with Providers

DSH Desk/Field Procedures

ICR Desk/Field Procedures

DSH Report to DOH

Review of ICR Refiles

DSH Report to CMS

ICR Report to DOH

DSH ICR

*Please note that this preliminary timeline is subject to change.


DSH and ICR Updates – new Tool section!New for the 2013 DSH and 2015 ICR Audits is a designated place within the Exit Dashboard of the Audit Tool where hospitals are required to submit a corrective action plan related to each finding identified during the audit.

Providers are responsible for submitting this data within the Tool once the Exit Dashboard has been issued. KPMG will not be following up on this information; it will be provided to the Department of Health (DOH) and the appropriate hospital association for their reference. If the hospital chooses to not provide this information, there is a place to indicate so within the Audit Tool.

This new section will also help DOH have readily-available information related to how the provider community plans on correcting findings going forward. Please note that for DSH, this information may be shared with the Centers for Medicare and Medicaid Services (CMS) per any potential follow-up inquiries.

ICR/DSH Timeline and Tool Update

ICR Audit Updates


Technical Items

2015 ICR Audit - Key Milestones


01

02

Key Considerations –Supporting Documentation

03



ICR Audit Follow-up Taking Place— KPMG and providers communicate within the ICR Audit Tool to clear any follow-up items.

- Providers supply additional supporting documentation, as needed.

— For field audits, onsite visits are held.

— Providers agree/disagree with potential findings.

— For any additional adjustments or disagreements with findings/adjustments, providers work with their KPMG audit team before the exit dashboard is released.


FEB APR MAYMAR JUN


2015 ICR Audit - Key Milestones (cont’d)

Exit Dashboards are Released— Providers respond to findings and adjustments included in exit dashboard.

— Within one week of receiving the exit dashboard, Providers submit a formal management response and corrective action plan for each finding included in their exit dashboard.

FEB MAR MAYAPR JUN


New for 2015 ICR Audit – Corrective Action Plan



ICR Refile Submission Period— Within 30 days of receiving their exit dashboard, providers should submit their refiled cost report in line with

the adjustments proposed in their exit dashboard.

— After refiling their cost report, providers must complete the Provider Refile Affirmation.

— Note: Providers should only refile based on the findings included in their exit dashboard. If the provider disagrees or would like to make additional adjustments, they must formally notify the Department and provide reasoning via certified mail. The Department expects that these requests will be rare, since providers are given the opportunity to bring additional adjustments to the attention of their KPMG Audit Team during the audit.

FEB MAR APR JUNMAY


New for 2015 ICR Audit – ICR Refile Provider Affirmation



ICR Refiles are Reviewed— KPMG will review the refiled cost reports, to assist the Department in obtaining “final audited cost reports”

for the Department to use in rates, distributions, and analysis.

— A “final audited cost report” meets each of the following criteria:

1. The data has been audited by the Department’s audit contractor.

2. The resubmitted ICR includes all adjustments that were proposed in the hospital’s exit dashboard.

3. The only changes incorporated in the resubmitted ICR were based on audit findings.

— For any discrepancies, KPMG will be following up with the hospital, in order to assist the Department in obtaining a “final audited cost report”.

— Therefore, it is important to work with your audit team to resolve any discrepancies during the audit, instead of waiting until after the exit dashboard is released.

FEB MAR APR MAY JUN

Technical Items


— For columns 00260 and 00270, please include information (days/discharges) for all dual eligible patients that have Medicaid in conjunction with other insurance.

— Please include this information in the “Medicare Days/Discharges for Patients who are Medicaid Eligible” Columns.

— This should include all payers (i.e. Medicare, HMO, Commercial) and should not be limited to only Medicare/Medicaid dual eligible.

Exhibit 30 – Dual Eligible Days/Discharges

Technical Items

— The statistic is procedures instead of visits.

— A procedure is defined as a “unit of measure for those types of services customarily provided on the basis of a complete service requiring multiple visits”.

— For reimbursement, all visits related to a procedure are counted as part of the one procedure and are not separately billable visits.

— Does not mean the number of “procedure codes” on the ambulatory surgery claims.

Exhibit 33 - Ambulatory Surgery Statistic

Key Considerations –Supporting Documentation


Key Considerations – Supporting Documentation

What level of detail should be provided?

— When providing support, whenever possible, please provide system generated reports or system reports with raw data and then summary level data on another excel tab, so your audit team can clearly understand how data is getting from the system to the cost report.

When is supporting documentation needed?

— For field audits, we review the supporting detail for a majority of Exhibits that are audited.

— For desk audits, while explanations can suffice for year-over-year fluctuations, if the hospital does not have a specific explanation for a year-over-year fluctuation, or if there are several variances, we can gain comfort over the data by receiving adequate supporting documentation from the hospital.

When should hospitals pull the supporting documentation for the ICR audit?

— Hospitals should try to maintain the documentation that was utilized during the ICR submission process.

— Specifically for field audits, we review the transaction level detail for data reported on Exhibits 32, 33, and 34 (if applicable). Therefore, hospitals should run and maintain this data, as it will be requested for all field audits.

1

2

3

DSH Audit Updates



Management Response and Corrective Action Plan

2013 DSH Audit Update01

02

Cost Report roration03

Results of Prior DSH Audits and Lessons Learned

Data Clarifications04

05

Next Steps06

Key Guidance Related to the DSH Program07

2013 DSH Audit Update


Timeline update2013 DSH Audit Update

Oct2016

Nov2016

Dec2016

Jan2017

Feb2017

Mar2017

2013 Audit Tool open Desk/Field audit procedures

Final report

to CMS

Notification packages

Key milestone 2013 DSH Audit anticipated date*

Hospitals receive notification package October 5, 2016

KPMG and DOH conduct kick-off Webinar October 5, 2016

Hospitals receive access to Tool November 1, 2016

Deadline for Tool completion and supporting documentation due November 30, 2016

KPMG and hospitals commence desk and field procedures December 1, 2016

KPMG and hospitals complete hospital desk and field procedures January 31, 2017

KPMG provides draft audit report to DOH March 10, 2017

DOH provides final audit report to CMS March 31, 2017

*These dates are subject to change per the Department of Health.

Webinar presentation

2013 Audit Tool and

Documentation Due

Draft report to DOH


Thank you for your cooperation!Thanks to the cooperation of the provider community, KPMG has successfully completed the majority of desk and field audit procedures for the 2013 DSH Audit!

This was a very tight timeframe for Tool submission and audit procedures, and KPMG sincerely appreciates this joint cooperation. KPMG is on track to provide DOH with a draft report on schedule.

2013 DSH Audit Update



New requirement for 2013 DSH AuditIn the 2013 DSH Audit Tool, the Exit Dashboard has been updated to include one new section.

Management Response

The hospital is now responsible for presenting a response for each finding identified. For example, if the hospital’s billing system is currently not capable of breaking out certain data, the hospital should use this opportunity to document the specific details as to why the system is unable to do this and what steps if any will be taken to address the finding.

As part of each response, the hospital is responsible for documenting a plan to address each issue/finding. The plan should include the estimated timeframe (e.g., six months, one year, etc.) to address the problem.

Additionally, please note the following:

—Hospitals will have five business days to provide this information once the Exit Dashboard is issued.

—This information may be presented to CMS in any potential follow-up questions.

—KPMG will not be following up with hospitals on providing this information.

—Providing a Management Response and Corrective Action Plan is the responsibility of each hospital, and DOH will expect that this information is documented within the 2013 DSH Audit Tool.

—The lack of a response may present a risk for the hospital for not receiving future DSH payments.



Management ResponseManagement Response and Corrective Action Plan

Cost Report Proration


Hospital year-endsCost Report Proration

— If your hospital operates on a fiscal year that is separate from the calendar year, one of the two CMS-approved methods for cost report proration must be followed. Please refer to Additional Information on the DSH Reporting and Auditing- Part 2 for more information.

— Separate sets of MMIS data are provided to KPMG by DOH, and uploaded into the DSH Tool that contain data for the related Medicare Cost Report dates. Hospitals are expected to provide their data within the DSH Tool for the same period. Language has been added to the header of the DSH Tool for each calendar year or cross-year hospital as follows to clarify which period that specific Tool should contain data for.

— If your hospital changed fiscal years between 2013 and 2014, and Medicare Cost Reports were filed for 2014 other than the calendar year, please reach out to the KPMG DSH Mailbox at: [email protected]. A second Tool will have to be created to your facility for the 2014 DSH Audit.

Approach for Cross-Year Hospitals

mailto:[email protected]

Data Clarifications


— All data entered into the DSH Tool is required to be supported by documentation provided to KPMG (such as patient level detail records, Medicare cost reports, settlements, etc.). If the data does not fully reconcile to supporting documentation, an explanation for unreconciled amounts must be provided. If the data cannot be supported, this data is subject to exclusion from the 20 data elements.

— If the hospital adjusts Medicaid Management Information System Medicaid fee-for-service dual-eligible payments, matching patient-level data needs to be provided. If not provided, the audit team may revert to MMIS data.

— If the hospital chooses to use the MMIS Medicaid fee-for-service dual-eligible charges, charge detail per cost center should be provided that totals to the same number provided by MMIS. Matching patient-level data needs to be provided to support the breakout by cost center.

DSH Audit common themes (cont’d)

Supporting Documentation

— CMS recently provided clarification that costs and payments related to Family Health Plus are considered to be Medicaid for DSH purposes and should be included in the calculation of the hospital-specific DSH limit.

Family Health Plus

Data Clarifications


— The following payments are automatically reduced in the DSH Tool by two percent per the across-the-board reduction to Medicaid payments in place for 2013 and 2014. Because of this, the payment amounts will not directly reconcile to the source files provided by DOH.

— All MMIS payments, including:

— Medicaid fee-for-service primary and dual-eligible payments in section 2C

— Medicaid graduate medical education (GME) payments in section 2E.

— Supplemental payments in section 2F with the following descriptions:

— “Miscellaneous OHIP”

— “OMIG Refund”

2% Reduction

DSH Audit common themes (cont’d)Data Clarifications


— Additional clarification – payment vs. eligibility- When classifying patients to the appropriate section of the DSH Tool, hospitals should include patients

based on eligibility as opposed to specific payments. Example:

— Patient A has Medicaid and Aetna

— Aetna pays the full bill; Medicaid pays no portion

— Patient A should be included in the appropriate Medicaid dual-eligible section

Medicaid charges and payments

— Additional clarification – Medicaid primary (“Medicaid only”) definition- Medicaid Primary sections of the DSH Tool should only include claims where Medicaid is the only payor

that the patient is eligible for. In prior DSH Tools, several hospitals included claims in the Primary sections where Medicaid is the first payor, and the patient is eligible for another type of insurance as a secondary and/or tertiary payor. These claims should be included under the dual-eligible population.

Medicaid dual-eligible costs and payments

DSH Audit common themes (cont’d)Data Clarifications



2012 DSH Audit findings – insufficient supporting documentationInsufficient supporting documentation or insufficient participation on some audit procedures (19%)— The hospital did not submit adequate documentation to support amounts claimed in the Tool or did not submit

sufficient information for KPMG to perform certain audit procedures.


The patient level detail did not reconcile to the amounts used in the uncompensated care cost calculation (i.e., no summary linked to detail, missing reconciling items, etc.).

41%The patient level detail did not contain

all requested attributes.

23%

The hospital did not submit all applicable supporting documents.

22%

The hospital did not provide answers to certain follow-up questions; hospital did not

provide sufficient information in their responses; or hospital did not provide

additional documentation as requested.11%

Other

3%


— Lesson learned – 2013 DSH Audit updates- All data entered in the DSH Tool is required to be supported by documentation provided to KPMG (such

as patient detail records, Medicare Cost Reports, settlements, etc.). If the data does not fully reconcile to supporting documentation, an explanation for unreconciled amounts must be provided. If the data cannot be supported, this data is subject to exclusion from the 20 data elements.

- If the hospital adjusts MMIS fee-for-service dual-eligible payments, matching patient-level data needs to be provided. If not provided, audit team may revert to MMIS data.

- C-level executive will be required to respond to each finding their hospital received as part of the 2013 DSH Audit. The hospital’s Exit Dashboard, which is issued to each hospital at the end of each DSH Audit, will be updated to include a tab for a Management Response and Corrective Action Plan. Note that detailed explanation regarding lack of support will need to be provided.

- As consistent with the 2011 and 2012 DSH Audits, hospitals will not be issued a formal finding for not being able to reconcile their patient detail records with the respective MMIS amounts if MMIS is being used. Instead, an observation will be noted for informational purposes only. Hospitals will be able to provide feedback on the accuracy of the MMIS data for their hospital as part of the Management Response and Corrective Action Plan.

2012 DSH Audit findings – insufficient supporting documentation (cont’d)

Insufficient supporting documentation or insufficient participation (19%)



— Additional clarification – common causes for issuance- Hospital made an adjustment to MMIS fee-for-service dual-eligible payments, however was unable to

provide supporting documentation for the adjusted payment amount.

- Hospital did not provide sufficient support for a Medicare Cost Report settlement, or final GME/IME amount. Please note that settlements to be included should be final (cash received), not filed (cash expected).

- Hospital did not provide sufficient support that fully reconciled to the days, charges, or payments reported in Part 2, Sections C (Medicaid fee-for-service), D (Medicaid out-of-state), E (Medicaid managed care), and/or G (Uninsured).

- Hospital did not provide sufficient information that appropriately documents secondary, tertiary, or any other additional payors. Note that all payor information is to be provided.

- Hospital is unable to determine if any payments received in 2012 for services that occurred in years prior to 2012 (and not captured in a prior DSH Tool) are appropriately included in the 2012 DSH Tool.

- Hospital did not appropriately “bucket” data correctly (such as including Medicaid managed care data within the Medicaid fee-for-service population, Medicaid primary data within the Medicaid dual-eligible population, etc.).

2012 DSH Audit findings – insufficient supporting documentation (cont’d)

Insufficient supporting documentation or insufficient participation (19%)



2012 DSH Audit findings – non-allowable charges and paymentsNonallowable charges and payments (28%)— The hospital included charges and/or payments for Medicaid DSH non-allowed services and/or service

recipients, or is unsure if these services are included within the DSH Tool calculation.

The hospital is unsure if they included nonallowable services within the DSH Tool calculation.

50%The hospital included charges and payments for elective procedures.

24%

The hospital included charges and payments for Part B

Physician professional services.

18%

The hospital is unable to separately identify charges and/or payments related to FQHC

services from non-FQHC locations.

6%

The hospital included charges and payments for Swing Beds.

2%



— Lesson Learned – 2013 DSH Audit updates- The 2013 DSH Audit Tool has been updated to request information separately as it relates to non-

allowable charges and payments (discretely charged pharmacy services, professional fees, denied charges, administrative denials, elective procedures, and other).

- Sub-findings have been created that identify specific issues as it relates to non-allowable charges and payments. For example, sub-findings specify if the hospital is unsure if data included, or if the data is included the hospital cannot quantify the amount. This will help DOH respond to any potential CMS follow-up questions with detailed information that is readily available.

- If a hospital inappropriately includes (or is unable to determine if it includes) a non-allowable charge or payment, a C-level executive from the hospital will be required to submit a Management Response and Corrective Action Plan that addresses how this data why this data is currently non-identifiable and how it will be identified and excluded in future DSH audits.

2012 DSH Audit findings – nonallowable charges and payments (cont’d)

Nonallowable charges and payments (28%)



2012 DSH Audit findings – denied charges and withheld claimsDenied charges and withheld claims (21%)— The hospital included, or is unable to determine if they included, in their DSH calculation (as Medicaid-eligible

or uninsured) payments, charges, or costs for services where the payor denied payment for administrative or medical necessity reasons, or where a claim was never submitted to the payor.

The hospital is unable to identify whether administratively denied services payments and costs for Medicaid-eligible individuals are included in the Tool amounts.80%

The hospital incorrectly included payments, charges, or costs, for services where

the payor denied payment for administrativeor medical necessity reasons.

20%



— Lesson Learned – 2013 DSH Audit updates- This finding has been removed for the 2013 DSH Audit, however sub-findings relating to issue with denied

charges or withheld claims are included within the applicable finding. For example, findings related to withheld claims are included within the three Medicaid findings (fee-for-service, out-of-state, and Managed Care).

- If a hospital inappropriately includes (or is unable to determine if it includes) a denied charge or withheld claim, a C-level executive from the hospital will be required to submit a Management Response and Corrective Action Plan that addresses why this data is currently non-identifiable and how this data will be identified and excluded in future DSH Audits.

— Additional clarification – administratively denied definition and treatment- CMS final rule on the definition of uninsured:

— “Improper billing by a provider does not change the status of the individual as insured or otherwise covered. In no instance should costs associated with claims denied by a health insurance carrier for such a reason be included in the calculation of hospital-specific uncompensated care costs.”

— “The costs of services for individuals who have health insurance are not included in calculating the hospital-specific limit, even if insurance claims for that particular service are denied for any reason.”

2012 DSH Audit findings – denied charges and withheld claims (cont’d)

Denied charges and withheld claims (21%)


Next Steps


What’s Next?

Jan 2017

Feb2017

March2017

April2017

May2017

June2017

Hospitals Complete 2013 DSH Audit Desk/Field procedures

Draft 2013 DSH Audit

report to DOH

Final 2013 DSH

Audit report

to CMS

July 2017

*This timeframe is an estimate as of now, and is subject to change per the Department of Health. As soon as a tentative timeline is determined for the 2014 DSH Audit, providers will be informed.

Anticipated timeline for 2014 DSH Audit Desk/Field procedures*

Next Steps

Key Guidance Related to the DSH Program


Key Guidance Related to the DSH ProgramLink to regulatory materials— Section 1923 of the Social Security Act

- http://www.ssa.gov/OP_Home/ssact/title19/1923.htm

— December 19, 2008 DSH Audit and reporting final rule

- http://www.gpo.gov/fdsys/pkg/FR-2008-12-19/pdf/E8-30000.pdf

— April 24, 2009 DSH Audit and reporting rule correcting amendment

- http://www.gpo.gov/fdsys/pkg/FR-2009-04-24/pdf/E9-9232.pdf

— September 18, 2013 additional DSH reporting requirements rule

- http://www.gpo.gov/fdsys/pkg/FR-2013-09-18/pdf/2013-22686.pdf

— General DSH Audit and reporting protocol

- http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Downloads/General_DSH_Audit_Reporting_Protocol.pdf

— Additional information on the DSH reporting and audit requirements

- http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Downloads/AdditionalInformationontheDSHReporting.pdf

2013 DSH Audit key objectives, guidance, and milestones


Key Guidance Related to the DSH Program (cont’d)— July 17, 2009 DSH Audit and reporting compliance enforcement delay letter

- http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Downloads/DSH-Guidance71709.pdf

— DSH report format template

- http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Downloads/DSHReportFormat.pdf

— Medicaid.gov DSH page

- http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Medicaid-Disproportionate-Share-Hospital-DSH-Payments.html

— April, 2014 CMS additional information of the DSH reporting and audit requirements – Part 2

- http://www.medicaid.gov/medicaid-chip-program-information/by-topics/financing-and-reimbursement/downloads/additional-information-on-the-dsh-reporting-and-auditing-req.pdf

— December 3, 2014 CMS final rule on uninsured

- https://www.federalregister.gov/articles/2014/12/03/2014-28424/medicaid-program-disproportionate-share-hospital-payments-uninsured-definition

2013 DSH Audit key objectives, guidance, and milestones

HCRA Audit Updates



Common Data Issues

Treatment of Medicaid Payments01

02

Surchargeable and Assessable Items Outside Main Billing System

03

Additional Information on HCRA Lines Assignments

04

Treatment of Medicaid Payments


Treatment of Medicaid payments

Payor Name Date of Service

Line Assignment

NYS Medicaid 10/5/2013 Line 5aMedicaid 1/1/2010 TBD

California Medicaid 6/19/2014 Line 11Conn. Medicaid 3/31/2012 Line 5c

<Note> DOS test determines whether a particular date of service falls between the effective and termination date periods of a payor name on the Elector list

Common Data Issues


Common data issues

— Description‒ The payor name field(s) in the universe of data does not indicate the specific payor that remitted

payment, and/or contains generic information (e.g. Commercial, Workers Compensation, etc.)

— Impact to Monthly Reports‒ Possible non-compliance (under or over paying) because the payor of record may not be properly

determined as electing or non-electing

— Impact to HCRA Audits‒ The auditor is unable to identify the payor, and the process for the provider to identify and support the

actual payors of record is time consuming and burdensome. Records where such information cannot be provided are considered surchargeable

— Desired Outcome‒ Better systematic tracking of payor names for all payments received, resulting in more accurate line

assignments

Generic/Unclear Payor Information


Common data issues (cont’d)

— Description‒ Some providers have difficulty distinguishing between copayments, deductibles and coinsurance within

their data

— Impact to Monthly Reports‒ Provider may not properly calculate a surcharge on secondary patient payments

— Impact to HCRA Audits‒ The auditor is unable to identify the secondary payment type and cannot determine if the primary payor

remits the surcharge on that payment type. Records where such information cannot be provided are considered surchargeable.

— Desired Outcome‒ Providers track whether payment received is a copay, deductible or coinsurance

‒ Determine and track if the related primary payor remitted the surcharge directly to the Pool on the patient’s portion

— Utilize the link below to the DOH website and leverage the results of a Payor Survey, conducted by DOH to list which payors elect to remit on these payment types:

— www.hcrapools.org/payor_survey/new_login.cfm (Username and Password required)

Surchargeability of Copayment, Deductible, and Coinsurance Payments

http://www.hcrapools.org/payor_survey/new_login.cfm


Common data issues (cont’d)

— Description‒ Some providers do not maintain historical, account level information accurately

— Eg. Primary through quaternary insurance plans on a patient’s account is overwritten as their insurance coverage changes over time

— Impact to Monthly Reports‒ May not affect the providers ability to accurately calculate the surcharge, however, changes to account

level information will affect the ability to maintain a trail to support previous decisions made

— Impact to HCRA Audits‒ The auditor is unable to rely on the primary payor on the patient’s account, which drives the surcharge

rate in certain scenarios. Records where such information cannot be relied upon may be treated conservatively at a higher surcharge rate when applicable

— Populations affected: Medicare eligibility, Federal eligibility, self-pay payments and non-electing payors

— Desired Outcome‒ Providers should maintain data historically as of the time the service was performed.

— Eg. If a patient’s primary insurer changes at a later date, the hospital should not overwrite the old information.

Non-historic Account Level Insurance Information


Potential fines for unreliable or unavailable data— The Auditee may be subject to fines pursuant to the PHL 2807-j(f)(d) (as recodified in PHL Sections 2807-

j(8a)(b) and 2807-t(10)(b)). The Law defines the fine as $10,000 per occurrence with an occurrence noted as an individual instance of unavailable data per month.

“Designated providers of services or third-party payors which, in the course of an audit pursuant to this section or section twenty-eight hundred seven-s of this article, fail to produce data or documentation requested in furtherance of such an audit, within thirty days of such request, may be assessed a civil penalty of up to ten thousand dollars for each such failure, provided, however, that such civil penalty shall not be imposed if the audited entity demonstrates good cause for such failure. The imposition of civil penalties pursuant to this section shall be subject to the provisions of section twelve-a of this chapter.”

– PHL 2807-j(8a)(b)


Best practices for maintaining data— Maintain the payor who actually made the payment

- Distinguish between the actual payor and the primary/secondary/tertiary insurances on the account

— Maintain payment codes to identify exclusions (eg. Medicare, Federal, Hospice)

— Maintain copayment, deductible and coinsurance payments within the data

— Track payor Tax Identification Numbers to simplify electing vs. non-electing determination process

Key Fields to Maintain Accurately

1 Date of Service (DOS)

2 Payment Date

3 Actual Payor Name

4 Primary/Secondary/Tertiary Insurance Plans

5Payment Amount

‒ Including separate fields for copay/deductible/coinsurance payments

Surchargeableand Assessable Items Outside Main Billing System


Surchargeable and assessable items outside main billing system— In addition to payments processed in the main billing system, additional items should be considered when

calculating the surcharge and assessment

— Providers should identify any additional surchargeable or assessable items and pay the applicable surcharge into the monthly HCRA pool

Examples of Common Potentially Surchargeable and Assessable Items

No. Reconciling Item Potentially Assessable (Y/N)

Potentially Surchargeable (Y/N)

1 Physician Billing Y Y2 Domestic Claims Y Y3 Retail Pharmacy Y Y4 Medicare Settlements Y N5 Medicare PIP Y N6 Medicare DME (Pass-through) Y N7 Medicare Settlements Y N8 Medicare Organ Y N9 Medicaid GME PEP Pool Y N

10 Lump-sum settlements and retroactive payments Y Y11 Capitation Arrangements Y Y12 Grant Revenue Y Y


Discrete billing private practicing physician guidance — In order to be considered excludable from the HCRA surcharge, physician services must be discretely billed (thus excluded from the

billing provider's institutional rates for services rendered) and the physician or faculty practice plan must be organized as a private practice

— The provider subject to the HCRA surcharge is responsible for asserting whether its physician billings are made on behalf of private practicing physicians or on behalf of the hospital as part of its outpatient service

— The affected provider is required to make this assertion based on the specific circumstances which govern the relationship between such billing entity and the associated physician or faculty practice plan

— Note: Effective with dates of service April 1, 2011, and after, revenue received for all discretely billed (separately billed) physician services (M.D. and D.O.s only) is no longer subject to a HCRA surcharge. Added 10/15: In addition to M.D. and D.O., physicianassistants and nurse practitioners are also exempt effective 4/1/11 if discretely billed. Prior to April 1, 2011, only revenue received for discretely billed private practicing physician services (including faculty practice plans) were exempt from HCRA surcharges. As such, billings prior to April 1, 2011, for employed physicians were subject to the HCRA surcharge

Provider (Current Treatment) Provider (Treatment effective as of 1/1/16)

Claims servicedbefore April 1,

2011

Provider to submit an attestation letter noting that:o The physician or faculty practice plan was organized as a

private practice (i.e. not an employee of the hospital or any of their extension clinics), and

o The physician billings were made on behalf of private practicing physicians or on behalf of the hospital as part of its outpatient service (i.e. discretely-billed)

See Provider (Current) for Claims serviced before April 1, 2011

Claims servicedon or after April 1,

2011

Provider to submit an attestation letter noting that:o The physician billings were made on behalf of private

practicing physicians or on behalf of the hospital as part of its outpatient service (i.e. discretely-billed)

See Provider (Current) for Claims serviced on or after April 1, 2011, and- The service was performed by one of the following

physician types:o Medical Doctor (MD)o Doctor of Osteopathic Medicine (DO)o Nurse Practitioner (NP)o Physician Assistant (PA)

Additional Information on Line Assignments


HCRA line assignmentsPurpose:To provide guidance for assigning individual payments to appropriate HCRA Report Lines, resulting in accurate calculation of monthly surcharge/assessment submissions.

Process: Line assignment determination process for monthly reporting— Goal: assign individual payments to appropriate HCRA Report Lines, resulting in accurate calculation of

monthly surcharge/assessment submissions

— Step 1: Identification of common exclusions

- E.g., payments related to Medicare-eligible beneficiaries, FEHBA, Hospice, etc.

— Step 2: Analysis of payor names to determine election status

- E.g., commercial, Medicaid, patient payments, etc.

- Explanation of this process from a DOH Audit perspective


HCRA line assignments (cont’d)Non-Surchargeable Line Assignments

— Line 2 Exclusions:

Payments IP Line OP Line

Payments for Medicare eligible beneficiaries 2a 2a

Payments related to Federal Payors (Champus, Tricare) 2b 2b

Payments from Contracted Services performed for other designated providers 2c 2c

Payments received from a public hospital pursuant to an affiliation agreement contract 2d 2d

Payments from Discrete Billings for Private Practicing Physician Services 2f 2f

OP Payments from Laboratory payments for specimen drawn or collected outside NYS - 2g


HCRA line assignments (cont’d)Non-Surchargeable Line Assignments — Line 2 Exclusions:


Remove payments received directly from the public goods pool administrator (e.g., Health Facility Restructuring Grants, Commissioner’s Priority Pool Grants, or Health Workforce Retraining Grants)

2g 2h

Governmental Deficit Financing Grants 2h 2h

Medicaid Payments (e.g. Medicaid/FHP copayments, Pool distributions) 2i 2j

Payments received for referred ambulatory clinical laboratory hospital services performed on or after October 1, 2000 - 2k



— Line 5 Electing Payors:


New York State Medicaid Payments 5a 5a

Other payments from electing NYS agenciesExample - NYS Local Government Electing for correctional inmate payments

5b 5b

Payments from all other electing/direct payors (insurance companies, self insured, etc.) 5c 5c

Out of State Medicaid Payments (Electing States) 5c 5c



— Line 17/19 Exclusion:


Self Pay Payments from Insured Members where: Primary Insurance is an Electing Payor Included on the DOH Electing Payor Voluntary Remittance List

Examples

1. Aetna (electing on copay/coinsurance/ded) 17 19

2. Oxford Health Insurance Inc. (electing on copay/ded only and not coinsurance)

17 (Copay/Ded)10 (Coinsurance)

19 (Copay/Ded)10 (Coinsurance)


HCRA line assignments (cont’d)Surchargeable Lines— Line 8 – Line 12:


Payments from non electing Medicaid Payors 8 8

Payments from Non-electing NYS Agencies or Local Governments 9 9

Insured Patient (Self) Payments with Non Electing Payors per the DOH Electing Payor Voluntary Remittance List

10 10

Payments from Electing Direct Payors on Patient's Account (Primary/Secondary payors on account) 10 10

Non Electing Out of State Medicaid Payors* 11 (After 4/1/2012)12 (Prior to 4/1/2012)

11 (After 4/1/2012)12 (Prior to 4/1/2012)

Non Electing International/Foreign Payors or Unspecified Payors 11 11

Non Electing Direct Payors 12a (GME Liability)12b (No GME Liability) 12


Treatment of Medicaid payments

Payor Name Date of Service

Line Assignment

NYS Medicaid 10/5/2013 Line 5aMedicaid 1/1/2010 TBD

California Medicaid 6/19/2014 Line 11Conn. Medicaid 3/31/2012 Line 5c



Treatment of commercial insurance payments

Payor Name Primary Payor

Date of Service Line Assignment

Aetna Aetna 10/5/2013 Line 5cCommercial Misc. Ins. 1/1/2010 Line 12Commercial Misc. Aetna 6/19/2014 Line 10XYZ Non-elector Misc. 3/31/2012 Line 12




Treatment of Self-Pay Payments

Payor Name Primary Payor Line AssignmentPatient Payment Blue Cross Line 10Patient Payment ABC Non-elector Line 12Patient Payment Line 10Patient Payment NYS Medicaid Line 2i/2j

Treatment of self-pay payments


KPMG Outreach Program


Recent provider touch-points

December 21, 2016

NYS DOH Performance Audit Update

Newsflash

November 2, 2016

2013 DSH Audit Webinar

September 30, 2016

HFMA Region 4 Presentation

February 4, 2016

2015 ICR Audit Webinar

Keeping constant communication with the provider community:


October 19, 2016


February 1, 2017


We want to hear from you!

If you have any feedback that you would like to share as it relates to these performance audits, or have any suggestions for future outreach sessions, please reach out to the appropriate mailbox:

Health Care Reform Act (HCRA) Audit

KPMG E-mail address: [email protected]

DOH E-mail address: [email protected]

New York State Disproportionate Share Hospital (DSH) Program Audit



Institutional Cost Report (ICR) Audit










Questions and answers

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The KPMG name and logo are registered trademarks or trademarks of KPMG International.

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