Medicare’s Pre-Claim Review Demonstration Project to Begin in Florida

In August 2016, the Centers for Medicare & Medicaid Services (CMS) initiated a three-year Pre-Claim Review Demonstration for home health agencies (HHA) in Illinois, with plans to expand the demonstration shortly afterwards to four other states (Florida, Texas, Michigan, and Massachusetts). However, due to significant technical problems with the pre-claim review process in Illinois, CMS announced a delay of the roll-out in order to focus its efforts on education regarding the process, HHA documentation requirements, and common reasons for claim denials. The expansion of the pre-claim review demonstration to Florida is now expected to begin on April 1, 2017.

The Pre-Claim Review Demonstration seeks to test whether pre-claim review (as opposed to CMS’s traditional “pay and chase” methodology) improves the identification, investigation, and prosecution of Medicare fraud among HHAs, while simultaneously improving quality of care. HHAs participating in the demonstration must submit all the necessary documentation to support the claim prior to submitting a claim for payment. The Medicare Administrative Contractor performing the pre-claim review makes a determination if the claim is provisionally affirmed (fully or partially) or non-affirmed, and provides specific feedback on documentation issues for partially or non-affirmed claims. Providers also have unlimited opportunities to correct and resubmit the documentation for additional pre-claim review. Notably, during the demonstration, any claims not submitted for pre-claim review will be subject to pre-payment review. Unlike pre-claim review, if a claim is found to be incomplete or incorrect during pre-payment review, no opportunity is provided for correction and resubmission, and the claim will be denied. To seek further review, an HHA would need to appeal the claim through the standard Medicare appeals process.

Florida HHAs planning on participating in the demonstration have the benefit of CMS’s most recently publicized data on pre-claim review results in Illinois. Overall, Illinois providers have seen a steady increase in the rate of claim affirmation since the first quarter of the demonstration in Illinois, when the provisional affirmation rate hovered in the 30% range. By Week 24 of the demonstration in Illinois (in the week ending on January 14, 2017), CMS reported that 91.7% of pre-claim review requests received provisional affirmation, including both fully or partially affirmed decisions, with an upward trend for fully affirmed decisions.

With April 1 quickly approaching, Florida HHA providers must get processes in place to ensure requests for pre-claim review are timely submitted with all of the necessary documentation. Ensuring that pre-claim review submissions are organized and complete at the outset is important to facilitate the timely billing of claims and prevent disruptions in cash flow for providers.