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Appealing denied claims seems to work

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The government is looking for a way to track and report denial rates to consumers as part of health insurance exchanges.

By Emily Berry, amednews staff. Posted April 11, 2011.

A government review of the rates at which insurers decline to write policies and reject claims for payment found that when physicians and patients appealed denied claims, those appeals were “frequently” successful, with 39% to 59% resulting in a reversal.

The Government Accountability Office report, released March 16, also found that many health insurance claims denials stem from miscodings, incomplete information or other paperwork errors, pointing to the need for further automation of claims processing.

The report examined what the GAO called “application denials” — declining to write a policy for someone — as well as “coverage denials” — deciding not to pay a claim. The Patient Protection and Affordable Care Act called on the GAO to examine both. The Dept. of Health and Human Services, which has started tracking application denials, plans to track and publish rates of coverage denials as part of the health insurance exchanges that will be part of the health reform law, according to the report.

Until HHS tracks application and coverage denials in a comprehensive way, there is limited information available about both. The GAO noted that the American Medical Association helped the authors interpret and understand the limitations of denial data available.

Rejected applications, denied claims

The GAO examined application denial data in the individual insurance market, collected by the HHS during the first quarter of 2010 and from six states that already track denials.

Researchers found that the rate at which insurers declined to offer an applicant coverage averaged 19%, but rates varied widely. The report’s authors noted that there was a long list of reasons for that variability, and no one appears to be tracking the reasons cited for application denials.

It was difficult to gauge how rejected applications end up faring: Nobody seems to track whether rejected applicants ultimately find coverage through another company or whether an applicant is offered coverage at an affordable rate.

An average of 19% of health insurance applicants were denied coverage in the first quarter of 2010.

The rate at which insurers denied claims for payment also varied.

In California, for example, insurers rejected about 24% of claims in 2009, while Ohio reported an 11% denial rate the same year. The varying rates are in part due to how states define “denial.” The GAO report noted that while one state would count an instance where a claim was found to be a patient’s responsibility because a deductible had not been met as a denial, another state would not.

The AMA, which began releasing an annual report card on insurers’ claims handling in 2008, found an average denial rate of 4% in claims data for major insurers from two months in 2010, according to the GAO report. The low rate may have been due to the source and timing of the AMA’s sample — the Association looked at only electronic claims, which would have a lower denial rate than paper claims. In addition, the data came from February and March, after most enrollees typically exhaust their deductibles and claims denials tend to drop.

Waiting for more reliable data

If the federal government can find a way to uniformly report denial rates, the information would be useful to patients who want to avoid out-of-pocket costs and doctors negotiating a health plan contract, said Susanne Madden, CEO of Nyack, N.Y.-based Verden Group. The company tracks insurance companies’ policy changes, preauthorization requirements and other “hassle factors” for physicians.

“I think what physicians are beginning to wake up to now is considering what rates payers pay, but also what’s the cost of doing business?” Madden said. “If [a company] pays good rates but has a 40% denial rate, the business proposition is eroded quickly.”

Health insurance claims filed electronically have a lower denial rate than paper claims.

She said some of the GAO’s findings suggesting that physician offices’ paperwork errors were to blame for many denied claims raise questions about insurers, too.

Despite the high reported success rate in appealing claims denials, Madden said, physicians should file appeals judiciously. It’s not smart, she said, to spend $800 worth of physician and staff time on getting a $200 claim paid.

Appealing a single claim can cost more time and energy than it’s worth. But she advised physicians and staff to look for patterns of denials and consider challenging denied claims in “batches” when denials appear to be related.

And, she said, physicians should consider getting the patient involved in appeals. “Insurance companies will often listen to customers more than vendors.”

If denial data are made public, they should be reported uniformly and carefully so customers understand the limitations of the figures, said Robert Zirkelbach, spokesman for trade group America’s Health Insurance Plans. He said his group will help HHS make that happen.

“I know that we’ve provided a lot of information commenting on these and shared a lot of information to make the process work better,” he said.

Ethical concerns come into play when physicians become part of health conversations on Facebook and other sites.

By Pamela Lewis Dolan, amednews staff. Posted March 28, 2011.

Patients using social media to check in on what their friends and family are doing are starting to use the sites as sources of information for something else — health care.

National Research Corp., a health care research company based in Lincoln, Neb., recently surveyed more than 22,000 Americans and found that nearly 16% use social media sites as a source of health care information. Of those, 94% said Facebook was their preferred source, followed by YouTube with 32% and Twitter with 18%.

The company did not ask patients why they used social media as a health information source. However, analysts say that because people are spending more time on social media sites, they have begun to include questions and research about health care as a part of that experience. They say many like having an instant conversation online, rather than merely reading what someone has posted on a website.

“For many people, social media — or Facebook in particular — is the Internet,” said Jennifer Dyer, MD, MPH, a pediatric endocrinologist and an assistant professor of pediatrics at the Research Institute at Nationwide Children’s Hospital in Columbus, Ohio.

On a scale of 1 to 5, with 5 being the highest, 82.3% of those surveyed who used social media trusted the information on a level of 3 or higher, and 78.8% gave a level of 3 or higher to the likelihood of social media influencing their health care decisions.

Physicians can ask patients about what health websites they consult and give their patients a list of recommended sites. However, the dynamic is different with social media — and so are the moral and ethical expectations and obligations.

For example, American Medical Association policy discourages physicians from socially interacting with patients on social media, though professional sites are encouraged. The Association has had policy, even before social media was an issue, that physicians should not practice medicine online with patients when there has been no previous face-to-face relationship.

But experts say physicians concerned about what patients might find on social media can come up with ways to become involved in their health conversations.

For example, a physician can have a Facebook page that is actively updated and maintained so that when patients have general health or wellness questions, they can ask the doctor instead of throwing it out to everyone they know on Facebook. It also can be a place where physicians share what they consider quality research and educational material. Patients would be amenable to what a physician has to say on social media, given that the National Research survey found that hospitals and physicians are patients’ most trusted sources of health information.

“I do think, as a physician and a communicator, it’s an ethical duty … for everyone to contribute something to this massive pool of information — where everyone is looking — that is accurate information,” Dr. Dyer said. She and her hospital have presences on multiple social media sites, and she said often patients say it’s more convenient to get in touch with her through those means rather than by email.

The National Research survey did not ask specifically what social media presences the respondents checked out, what advice they were seeking or from whom. But there is plenty of evidence that social media users are following health-related feeds.

The American Cancer Society has more than 228,000 “likes” on its Facebook presence, meaning the number of Facebook users who follow its updates. The Centers for Disease Control and Prevention has about 82,000 likes on Facebook, and the American Diabetes Assn. has more than 72,000.

The amount of health information varies by the site. The American Diabetes Assn.’s Facebook page includes a 10-question test to see if a person is at risk for type 2 diabetes. Hospital and physician social media sites might mix general health observations with news about their organizations.

Setting up a presence on a social media site doesn’t mean soliciting patients to come to the site with the promise of a diagnosis. But it can help steer patients to helpful information. For example, at Tufts Medical Center in Boston, the Facebook page also serves as a referral outlet to its other online educational resources, said Tim Brennan, public affairs and marketing manager for Tufts.

Though physicians are not expected to be the “rulers of the Internet” and monitor their patients’ every move or be available for every question they have, they can offer assistance when needed, Dr. Dyer said.

Take a recently reported case from the United Kingdom. Rahul Velineni, a physician from the Princess of Wales Hospital in Bridgend, Wales, saw a Facebook status update of an old school friend saying he was having severe stomach pains and trouble walking. The doctor suspected appendicitis and shared his concerns with his friend. The friend did have appendicitis and that by the time doctors operated, the appendix had perforated.

Howard Brody, MD, PhD, director of the Institute for the Medical Humanities at the University of Texas Medical Branch in Galveston, said the scenario represents an ethical question that goes beyond social media, or even the fact that the person who offered the advice was a doctor.

“There’s a general sort of ethical obligation to help other people out,” Dr. Brody said. A physician may have knowledge relevant to a certain situation, he said.

“If you stumble upon information that they could really use to protect themselves, not to share it would be ethically questionable,” he said.

On the other hand, offering specific medical advice can cross ethical boundaries, Dr. Dyer said.

“If someone says, ‘How much Tylenol do I take?’ and they are not your patient, you can’t say, because you don’t know if they have a liver condition or anything about them,” she said. “It’s not too different from someone at the airport that you happen to be sitting next to asking, ‘Should I do this or that?’ Most doctors are not going to practice medicine on someone they do not know.”

What Tufts Medical Center and other hospitals and physicians have found is that they don’t have to provide answers to every question to keep patients coming back to their Facebook page, Brennan said. The community shares its expertise and experiences. The hospital or physician practice simply acts as a host that brings the community together.

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The AMA and groups representing clinical laboratories had urged CMS to rescind a new requirement that doctors sign off on lab tests.

By Charles Fiegl, amednews staff. Posted Feb. 28, 2011.

Washington — Responding to pressure from the American Medical Association and others, the Centers for Medicare & Medicaid Services has indicated that it will rescind a new Medicare rule requiring physicians to provide their signatures on requisitions for laboratory tests. Doctors had warned that the rule would have created paperwork headaches for medical professionals ordering and fulfilling lab test requests, ultimately having an adverse impact on patient care.

The signature policy has been on the books since Jan. 1, but it was never enforced by the Medicare agency. CMS finalized the rule in its 2011 physician fee schedule in November 2010. However, citing concerns about lack of awareness of the change in the health care industry, the agency delayed enforcement of the policy until April 1.

Lawmakers soon became involved, requesting an additional nine-month enforcement delay. Reps. Michael Burgess, MD (R, Texas) and Bill Pascrell Jr. (D, N.J.) wrote a Feb. 10 letter to the agency stating, “We worry about how the rule could affect Medicare beneficiaries where such lab services are necessary for a physician to make critical decisions that affect patients’ health and well-being, often under significant time constraints, and urge CMS to consider these situations as they examine this policy.” The letter was signed by 87 other lawmakers. A group of 34 senators sent a similar letter to CMS on Feb. 11.

But the AMA, along with several other members of organized medicine, called for the agency to abolish the signature rule permanently.

“We clearly communicated to CMS that the added administrative hassles this rule would impose on physicians were burdensome and unnecessary,” said AMA President Cecil B. Wilson, MD. “CMS’ decision to reverse this policy will allow physicians to spend less time on paperwork and more time on patient care. This decision is an important step as the administration works to ease regulatory burdens for businesses, including physician practices.”

CMS spokeswoman Ellen Griffith would not comment on how the agency would go about rescinding the rule. “All I can confirm is that the agency is taking another look at the policy and considering next steps,” she said.

Not a new concept

The lab signature policy had been in development for several years. CMS proposed the rule in 2009, but it chose not to finalize it because of concerns raised during a public comment period. In 2010, agency officials had enough confidence that they had ironed out those details that they decided to include a signature requirement in the 2011 fee schedule.

The rule would not create an extra burden for physicians, CMS had said, because in most instances a physician already is annotating the patient’s medical record with either a signature or an order, as well as with any paperwork needed to identify the lab test. The agency also noted that a signature in ink would not be required for similar requisitions made over the phone or through an electronic medical record system.

In the final fee schedule rule, CMS further defended its decision by stating that the policy would make it easier for lab technicians to know whether a test was appropriately requested. Also, “potential compliance problems would be minimized for laboratories during the course of a subsequent Medicare audit because a signature would be consistently required.”

But physicians argued that the signature requirement would create an additional barrier between them and their patients. The policy could interfere with a physician’s ability to practice medicine professionally and efficiently, said Jeff Terry, MD, a urologist in Mobile, Ala. He said physicians can’t be in front of patients to sign requisitions all of the time.

For instance, Dr. Terry said, a scenario might exist where a physician performing surgery in the operating room receives an urgent call for another patient. The doctor already is aware of the second patient’s problem, so he wants the patient to get an x-ray immediately, then follow up with the physician in the office later. The physician’s nurse could provide the patient with the requisition needed to obtain the x-ray, expediting the process in a way that benefits both patient and physician, he said. This handoff would not be possible if a physician signature requirement were in place.

“Patients with kidney stones don’t want to wait another day for me to sign the paper before they can do a test,” he said.

Before the most recent rule change, CMS had been very clear that doctor sign-offs weren’t required, said JoAnne Glisson, senior vice president of the American Clinical Laboratory Assn. in Washington, D.C. Consequently, almost all requisitions arrive at labs without signatures.

The new policy had left labs facing a choice between two unpleasant options if they wanted to be paid by Medicare for all the services they provide, said Richard Daly, CEO of Laboratory Partners, a large full-service lab company based in Cincinnati that runs about 5.5 million tests a year. “One would be to not provide the test — or provide the test and chase the physician or facility for a signature,” he said. “Neither was a great solution.”

Glisson said senior CMS officials informed the lab association that they were going to rescind the policy. She said the agency would need to issue an interim final rule to undo the requirement before April 1, but the new document had not been released at this article’s deadline.

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The AMA obtains delayed enforcement of a regulation requiring proof of face-to-face encounters with patients referred for such services.

By Chris Silva, amednews staff. Posted Jan. 17, 2011. American Medical Association

Washington — Advocacy efforts by the American Medical Association helped persuade the Centers for Medicare & Medicaid Services to delay enforcement of a new regulation that requires physicians to document face-to-face encounters with patients for the beneficiaries to receive covered home health services.

The regulation, required under the health system reform law, went into effect Jan. 1. However, CMS decided to delay enforcement of the regulation for the first three months of 2011.

Patients always have needed physician authorization to receive home health services. The new documentation requirement is intended to ensure that a doctor’s order is based on up-to-date knowledge of the patient’s condition, CMS said.

Under the rules, a doctor or authorized nonphysician practitioner whose patient needs home health services must document a face-to-face visit with the patient within 90 days before the start of services and provide a separate certification that the patient is homebound and needs the care. For patients who start home health care based on a new condition without having seen a doctor in the past 90 days, the doctor must document a face-to-face visit and certification within 30 days of the onset of care for the services to be covered by Medicare.

The AMA had argued for a six-month delay of enforcement for the rule, saying that CMS had not done enough to make physicians aware of the new documentation requirements.

“We are deeply concerned that CMS has done little outreach to physicians affected by this requirement, and unless CMS postpones enforcement of this requirement, patients and physicians could be negatively impacted,” AMA Executive Vice President and CEO Michael D. Maves, MD, MBA, wrote in a Dec. 23, 2010, letter to CMS Administrator Donald M. Berwick, MD. The Association worried that home health agencies would start rejecting patients who did not have the appropriate documentation, forcing them into hospitals or nursing homes.

Dr. Maves said the AMA is pleased that the agency already made changes to the final rule based on physician recommendations, such as extending the window of time in which the face-to-face encounters can occur. But, he added, “We know from considerable experience that at least six months is needed to conduct outreach to physicians on new policies.”

Concerns about fraud, abuse

According to physicians familiar with the regulation, Congress authorized it and CMS developed it to improve access to home health services and prevent fraud and abuse.

“CMS was concerned about home care agencies serving patients who might not actually be eligible for coverage for the services,” said Edward Ratner, MD, associate professor of medicine at the University of Minnesota Medical School.

He said once physicians who see patients requiring home health care know about it, the documentation requirements shouldn’t prove too difficult for doctors.

“It requires some level of appropriate physician oversight, and it might be messy at first, but hopefully it won’t be too onerous,” Dr. Ratner said. “It’s important for physicians to make sure they don’t stop referring. We don’t want to underserve our patients because there’s a new paperwork requirement.”

C. Gresham Bayne, MD, an emergency physician in the San Diego area, said physicians who already make house calls should not have a problem with the new regulation. He said such doctors already have had to document the “medical reasonableness and necessity” of home visits for years. However, he said office-based physicians may have more trouble with the new documentation requirements.

These doctors “simply have fewer options to the quandary of seeing patients who cannot be seen in the office,” said Dr. Bayne, who is also the chair and founder of Call Doctor Medical Group, a San Diego-based organization that provides board-certified physicians and physician assistants to provide house calls to patients. He started the organization after seeing firsthand how costly unnecessary emergency department care can be.

Dr. Bayne added that patients of office-based physicians who may need home care services could encounter access problems if they’re not made aware of the new face-to-face visit requirements. The vast majority of homebound patients do not have any contact with doctors or nonphysician practitioners who make house calls, he said.

Still pushing for more time, outreach

Some physicians who refer patients for home health services said the 90-day delay in the regulation will be advantageous.

“Pushing back the deadline is helpful, because I don’t think a lot of doctors knew about this regulation,” said Peter Boling, MD, professor of medicine and interim chair of the division of internal medicine at Virginia Commonwealth University School of Medicine in Richmond. “Home health agencies worry that patients will not have a timely certifying visit post-hospital that will support agency billing.”

Dr. Boling said typical problems with documentation and continuity under the new rules could arise when a patient initially is treated for an illness in a hospital and is then placed on home care after discharge without a solid hand-off.

That’s one of the reasons the AMA continues pushing for a full six-month delay of enforcement from CMS. In the meantime, the Association is calling on CMS to continue educating physicians about the new requirements, as well as the contractors who will need to process the related claims.