CMS to Revise Manual Medical Review Process for Therapy Services

The “Medicare Access and CHIP Reauthorization Act” enacted last month included several provisions that will have a direct impact on outpatient therapy services over the next couple of years.  In addition to the extension of the therapy cap exceptions process reviewed in the previous blog post, the bill also calls for the Secretary of Health and Human Services to implement a revised manual medical review process to replace the current process which applies to services above the $3,700 threshold.

Currently, Medicare Administrative Contractors flag therapy claims that exceed $3,700 of per-beneficiary expenditures annually.  The MAC sends an ADR to the provider requesting that additional documentation be sent to the Recovery Auditor. The RAC then conducts the review and notifies the MAC of the decision.  When the RAC program paused in early 2014, CMS indicated that all claims would be paid but would still be reviewed once the RAC contracts were awarded.  RAC reviews of these claims have begun on a limited basis.

The Medicare Access and CHIP Reauthorization act, however, mandates that the manual medical review process be replaced with a process under which the Secretary shall identify and conduct manual medical reviews for providers using factors the Secretary “determines to be appropriate”.  Those factors may include:

• Providers with a high claims denial % for therapy services or who are less compliant with applicable Medicare program requirements
• Reviewing providers with patterns of aberrant billing practices compared with peers or who demonstrate questionable billing practices such as billing medically unlikely units of service in a day
• Newly enrolled providers
• Services are furnished to treat a particular type of medical condition
• Provider is part of group that includes another therapy provider identified using these factors

The new process will apply to exception reviews that have not been conducted by the implementation date which is projected to be sometime in mid-July.  The law requires the Secretary to implement the changes within 90 days of the enactment of the law.

It is encouraging that reviews may no longer be based on an arbitrary monetary figure since patients may be seen for multiple conditions in the same calendar year or may require more intensive treatment for certain conditions or injuries.  Less encouraging, though, is the thought of newly enrolled providers or therapists in the same practice as another provider who has been flagged for review being subjected to the revised process.  For most therapy providers, the current manual medical review process has typically applied to a small number of their Medicare patients.  Going forward, however, it will be important for clinicians to be knowledgeable of the process and to ensure that their documentation supports the medical necessity of the services provided and that those services require the skills of a therapist.   Stay tuned for future updates on the revised process.

Link to bill language pertaining to the manual medical review process: Medicare Access and Reauthorization Act