MedData’s Senior VP of Medical Affairs breaks down what you need to know when – not if – you receive a TPE audit
For years, the rate of improper Medicare claims – from simple mistakes or even fraud – has been on the rise, leading to increased denials and appeals. In October 2017, the Centers for Medicare & Medicaid Services (CMS) initiated the Targeted Probe and Educate (TPE) audit program to help providers identify and correct errors in their coding and billing so that denials and appeals will be reduced.
CMS has authorized Medicare Administrative Contractors (MACs) to perform targeted probe and educate audits. These audits are intended to increase accuracy in a variety of very specific areas. The MACs will audit providers and suppliers that have high claim error rates or unusual billing practices. In addition, MACs will use their analysis to identify those items and services that have high national error rates and are a financial risk to Medicare.
Essentially, this means that Medicare may audit claims that may have nothing to do with a particular provider’s coding and billing practices. CMS notes the following common claim errors: the signature of the certifying physician was not included; the encounter notes did not support all elements of eligibility; the documentation does not meet medical necessity; or there was missing or incomplete initial certifications or recertification.
Initially your MAC will initiate a review of 20-40 claims. These reviews can include both pre- and post-pay accounts. After the review, the MAC will either approve or deny those claims. The provider will be sent a letter detailing the results of the review. Those providers deemed to have a “high denial rate” will be offered a one-to-one education program to address errors in the claims being reviewed. This session is carried out by phone and is intended to educate providers so that additional, similar errors are avoided.
Once the education is complete, a 45-day period will follow, allowing the provider to remediate their errors. A second round of reviews will then occur, and the same process will be followed. If after the second round, the provider continues to have high error rates, there will be another round of claims review and education.
If after three rounds the provider continues to have high error rates and fails to improve after three rounds of education sessions, the provider will be referred to CMS for further action. These actions may include 100 percent prepay review, extrapolation, referral to a Recovery Auditor, or some other action not identified. It is important to note that the determination of whether a provider requires additional rounds of review is based upon improvement from round to round.
What defines a “high denial rate”? The error percentage that qualifies a provider as having a high denial rate varies based on the service/item under review. The Medicare Fee-For-Service improper payment rate for a specific service/item or other data may be used in this determination. Each MAC may have their own defined error rate. Neither CMS nor the MACs have defined the error rates for specific CPT codes that would prompt additional reviews.
The issue is not if you are going to get audited but when. The essence of these reviews is the medical necessity of the service provided for the code billed. Medicare defines medical necessity in the Social Security Act 42 U.S.C. § 1395y(a)(1)(A): Medicare only pays for medical items and services that are “reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.”
The American Medical Association has a similar definition: “Health care services or products that a prudent physician would provide to a patient for the purpose of preventing, diagnosing, or treating an illness, injury, disease or its symptoms in a manner that is: In accordance with generally accepted standards of medical practice; Clinically appropriate in terms of type, frequency, extent, site and duration; Not primarily for the convenience of the patient, physician, or other health care provider.”
At the end of the day, documentation that defines the patient’s presenting problems, comorbidities, differential diagnosis, and risk of adverse outcome is essential in supporting the medical necessity of the services provided. Documentation serves to substantiate not only the quality of the medical care but also the medical necessity for the services provided including tests, interventions, and dispositions. Documentation functions as a communication tool with other providers, the first line in risk management and confirms the value of our services to the payers.
A targeted probe and educate audit is not a judgment regarding the quality of services provided or the coding and billing submitted. Rather, it serves as a tool for Medicare to ensure that providers better document the care provided so that reimbursement is commensurate with the services provided.
Take these TPE audits seriously. Your MAC may send the letters to your billing company, your practice address, or even your home. The response to Medicare must be timely to avoid summary denials; therefore, forward these requests promptly to your practice administrator.
MedData’s team of experts is available to assist you with TPE and any other audit questions or concerns you may have. I lead the clinical denials team, having worked with commercial, managed care and governmental payers, successfully reconciling denials, and achieving positive financial results. Leveraging MedData’s technology, a root cause analysis can pinpoint the cause of the denials. Furnished with actionable data, a strategic approach to clinical denials management can be implemented.