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Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid Audit Sampling Strategies Creating Sampling Plans and Challenging Flawed CMS Audit Samples T d ’ f l f 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific THURSDAY, JULY 7, 2011 T oday’ s faculty features: Patricia L. Maykuth, Ph.D, President, Research Design Associates, Decatur, Ga. Edward M. Roche, Ph.D., J.D., Director of Scientific Intelligence, Barraclough Ltd., New York The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.
Transcript
Page 1: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Presenting a live 90‐minute webinar with interactive Q&A

Medicare and Medicaid Audit Sampling Strategies Creating Sampling Plans and Challenging Flawed CMS Audit Samples

T d ’ f l f

1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific

THURSDAY, JULY 7, 2011

Today’s faculty features:

Patricia L. Maykuth, Ph.D, President, Research Design Associates, Decatur, Ga.

Edward M. Roche, Ph.D., J.D., Director of Scientific Intelligence, Barraclough Ltd., New York

The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.

Page 2: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Continuing Education Credits FOR LIVE EVENT ONLY

For CLE purposes, please let us know how many people are listening at your location by completing each of the following steps:

• In the chat box, type (1) your name, (2) your company name and (3) the number of attendees at your locationnumber of attendees at your location

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Page 3: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Tips for Optimal Quality

S d Q litSound QualityIf you are listening via your computer speakers, please note that the quality of your sound will vary depending on the speed and quality of your internet connection.

If the sound quality is not satisfactory and you are listening via your computer speakers, you may listen via the phone: dial 1-866-443-5798 and enter your PIN when prompted Otherwise please send us a chat or e mail when prompted. Otherwise, please send us a chat or e-mail [email protected] immediately so we can address the problem.

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Page 4: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

PresentersPresenters

Pat MAYKUTH, Ph.D. Research Design Associates, Inc.

Edward M. ROCHE, Ph.D.,J.D. Barraclough Ltd.

4

Page 5: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

“Defending Health Care Providers”

Medicare Audits

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Page 6: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The problem of Medicare fraud

6

Page 7: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

A dAgenda

✤Introduction (ER)

✤Statistics (PM)✤Statistics (PM)

✤Appeals Checklist (ER)

✤Discussion

7

Page 8: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

What is a Recovery Audit Contractor (RAC)?Contractor (RAC)?

S b t t t th F d l •Subcontractor to the Federal Government

A dit f M di l i•Auditor of Medicare claims

•Paid as percentage of what is recoveredrecovered

•Method used to select targets is "trade secret"trade secret

8

Page 9: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

ProblemsProblems

•Most health care providers have a doctorate in medicine, not in bureaucracy, or coding, or in documentation

•Health care provider is unaware of the dangers of extrapolation

F il t k l l l h t i t d l •Failure to seek legal counsel soon enough -- tries to do early stages of appeal by self

•Financing of litigation - is there a calculated market "sweet spot"?

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Page 10: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Typical violationsTypical violations

•Medical necessity

•DocumentationDocumentation

•Cloning

•Missing

I t i ffi i t d t ti•Inaccurate or insufficient documentation

10

Page 11: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

How estimation of overpayment is doneis done

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Page 12: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Calculated Statistics of Samplep

B f l i i Af l i iBefore claim reviewChoice of methodology

Si l

After claim reviewCalculate overpayment

Per claimSimple

Stratified

Per claim

For sample

Proportion of claims in errorSample size determination based on

Universe size

Proportion of claims in error

Calculate point estimate

Mean

Standard deviation or probe

Precision

Mean

Error rates

Precision for confidence interval

12

Confidence interval Upper and lower CI

Page 13: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

When an auditor may use yInferential Statistics

Sustained or high level of payment error determined by:

Error rate determinations by MR unit, PSC, ZPIC

Probe samples, Data analysis, Provider/supplier history

I f i f l f i i i Information from law enforcement investigations

Allegations of wrongdoing by current or former employees of provider or supplierprovider or supplier

Audits or evaluations conducted by the OIG

13

Medicare Program Integrity Manual § 3.10.1.4

Page 14: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Overview of the sampling processOverview of the sampling process

Universe Frame (dates; Sample

Definition (who; why; what data)

Frame (dates; units; criteria)

Definition (simple;

stratified)

Sample Size

Seed & Random Numbers

Pick Out Sample

14

Numbers p

Page 15: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

DefinitionsDefinitions

Universe All claims that were submitted to Medicare

Sampling Unit What was sampled: by claim, by patient, etc.

Frame A part of the universeFrame A part of the universe

Sample A randomly chosen set of (usually) claims

Overpayment Extrapolation How much the health care provider must pay back

15

RAT-STATS DHHS software often used to make calculations

Page 16: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Basic statistical terminologyBasic statistical terminologyM ( ) th ith ti f ll di id d Mean (average) the arithmetic sum of all scores divided by the number of cases

M di th iddl t l Median – the middle most real score

Mode the score that occurs most frequently in the data (d h b i i h 1 set (does not have to be unique – sometimes more than 1

value is equally likely)

Measures of variability, precision and confidence interval

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Page 17: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Normal DistributionNormal Distribution

17

Page 18: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

18Confidence Interval

Page 19: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Precision and Lower BoundPrecision and Lower Bound

Point estimate $1,000,000

Precision amount at 90% two-tailed confidence $140,000

Lower bound at 90% two-tailed confidence = $860 000Point estimate minus Precision amount $860,000

Precision percent = Precision amount divided 14%

19

Precision percent Precision amount divided by Point estimate 14%

Page 20: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The point estimate, precision and p , plower bound

Point EstimateRefund Demand

Confidence Interval

Refund Demand

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Page 21: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

StratificationStratification (numbers are illustrative only)

Universe FileAll claims for the provider for audit

time periodtime period152,480 claims

S S S SStratum 1>$10 <$68

107,466 claims

Stratum 2>$69 <$200

30,387 claims

Stratum 3>$201 <$50010,969 claims

Stratum 4>$5013,658

21

Page 22: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

2222

Page 23: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

RAT STATS Sample Size DeterminationRAT-STATS Sample Size Determination

# S MEAN STD DEV UNIVERSE # Strata MEAN STD.DEV. UNIVERSE RATIO

1 <$150 76.37 43.97 8,882 45%2 $150-$350 216.06 55.08 3,070 20%3 $350-$600 482.87 91.72 1,370 15%4 >$600 962 65 253 59 681 20%4 >$600 962.65 253.59 681 20%

- TOTALS - 189.87 227.17 14,003

23

Page 24: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

RAT-STAT Defined Proportion

Stratum 420%

Stratum 145%

Stratum 315%

Sample Proportion Used in Audit

Stratum 220

Sample Proportion Used in Audit

Stratum 125%

Sratum 425%

Stratum 225%

Stratum 325%

24

Page 25: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The statistical extrapolation

The ExtrapolationThe Extrapolation

The tremendous magnification is why the

statistics must be so The Extrapolation- multiple years of claims- interest and penalties

The Extrapolation- multiple years of claims- interest and penalties

statistics must be so accurate

- US Treasury is the collection agent

- "In case you are filing for

- US Treasury is the collection agent

- "In case you are filing forThe

SampleThe

Sample

$978 00

- In case you are filing for bankruptcy" forms included with

all demand letters

- In case you are filing for bankruptcy" forms included with

all demand letters

SampleSample

$978.00.

25

$1,369,000.

Page 26: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The appeals strategy

26

Page 27: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The appeals processThe appeals process

Contractor QIC

ALJALJDetermination Re-Determination Re-Consideration

27

Page 28: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The Administrative Law JudgeThe Administrative Law Judge

•Federal administrative law

•Medicare Program Integrity Manual (MPIM)

d l h•Not adversarial hearing

28

•Discovery Rules -- use of FOIA (Freedom of Information Act)

Page 29: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

The appeals strategy

StrategyStrategy

Attack extrapolation

Attack extrapolation

Dispute claims review

Dispute claims review

29

Page 30: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Checklist to “audit the auditors”

30

Page 31: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

When Auditor Uses Expertp

✴ Obtain the statistical experts’ written approval of the methodology (dated)

✴ Obtain the policies and procedures for auditors processes and quality controls

✴ Obtain evidence that anyone examined the appropriateness of the findings (signed)

✴ Obtain complete written notes statements and documentation of any statistician used by QIC

31

Page 32: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Data Necessary for Statistical Reviewy

A di h d l d l i d & d d✤ Audit methodology and logs, signed & dated

R d bl l i d fil f i f l l i ✤ Readable electronic data files for universe, frame, sample selection, sample and overpayment at claim line level

✤ Sample selection methodology, size estimation, seed, file sorted as applied and output

✤ Sufficient information to collapse data into CCN, strata or overpayment at every level

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Page 33: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

A few typical problems with claimsA few typical problems with claims

Overly restrictive interpretation of the MPIM

Making up rules

Failure to account for similar language used for patients with the same condition

Complexity -- it is doubtful anyone can do completely compliant coding

Frequent missing and disorganized files

33

Page 34: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

A few typical problems with extrapolation

Sample size

Incorrect use of formulas

Use of wrong formulas

Use of inapplicable methodology

Non-representative sample

Exclusion of zero paid claims

34

Accuracy outside of recommended range

Page 35: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Common excuses from contractor

MPIM d f bid iMPIM does not forbid it

Those are data/methods are proprietary

The statistic weights the result

Th lt j t d ithi th t tThe results are projected within the strata

“a probability sample and its results are always “valid.” MPIM , Chap 3 § 3 10 2 Chap. 3, § 3.10.2

30 is the smallest sample size we use and we increased the sample size so it is fine

35

size so it is fine.

Page 36: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Dirty tricksDirty tricks

Withhold information

Provide information in unusable formProvide information in unusable form

Provide information or assessment at last minute id d h i dso provider does not have time to respond

Insert reports into record after the hearingp g

Failure to give proper notice

36

Page 37: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

OutcomesExtrapolation in-

validatedExtrapolation

validated validatedvalidated

All or most claims reversed NEVERreversed NEVER

HAPPENS

Some denials are reversed

AIM HERE

No denied claims d

HAPPENS OFTEN

37

are reversed OFTEN

Page 38: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Discussion

38

Page 39: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

Contact Information for PresentersPat Maykuth, Ph.D.PresidentResearch Design Associatesgwww.researchdesignassociates.com

721 E. Ponce de Leon AvenueDecatur, GA 30030-2033Decatur, GA 30030 2033(404) 373-4637 [email protected]

Edward M Roche, Ph.D., J.D.Director of Scientific Intelligence Barraclough Ltd. gwww.medicare-audit-defense.com

New York, NY(646) 416-6592 phone

39

( ) [email protected]

Page 40: Medicare and Medicaid Audit Sampling Strategiesmedia.straffordpub.com/products/medicare-and-medicaid...Presenting a live 90‐minute webinar with interactive Q&A Medicare and Medicaid

✤ Barraclough Ltd. provides a team of statisticians who have a strong track record of developing arguments that aid health care providers in getting extrapolations thrown out. Barraclough statisticians include a Google Fellow and a Founder's Award recipient of the include a Google Fellow, and a Founder s Award recipient of the American Statistical Association. Barraclough offers several levels of service and prices for cases ranging from small single practitioners to large health care facilities involving multiple

l iextrapolations.

40


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