Payment Integrity Considerations as Elective Care Resumes

July 7, 2020 HMS

On March 18, 2020, the Centers for Medicare and Medicaid Services (CMS) issued a recommendation to delay elective surgeries and non-essential medical, surgical and dental procedures during the COVID-19 outbreak period. This was one of many sweeping actions the federal government took to preserve healthcare resources for critical patients while limiting the virus’ spread and protecting vulnerable individuals.

But as COVID-19 case numbers soared in early hard-hit areas, hospitals in states with comparatively few cases sat underutilized. With elective services on hold and alarmingly fewer patients presenting in emergency rooms, many hospitals and health systems began to bear a heavy financial burden. The New York Times reported 1.4 million health system job losses in April 2020, and overall industry losses as high as $50 billion a month due in large part to “forgone surgeries and procedures.”

Today, elective procedures have largely resumed. However, with COVID-19 cases now spiking in many parts of the South and West, a number of states are rolling back their reopening plans. In some areas of Texas, that includes placing elective services back on hold in order to free up hospital capacity for COVID-19 patients. As case numbers continue to increase, it is possible that other states will follow suit, just as these services were beginning to resume.

 No One-Size-Fits-All Approach

Navigating this uncertain and oft-changing landscape is a challenge for healthcare policymakers, providers, payers and patients alike. For one, elective care is not necessarily synonymous with non-essential care, and postponing these procedures has inevitably created urgent pent-up demand. Financially and resource strapped providers, many of which have furloughed workers, are dealing with an onslaught of new COVID-19-related coding and billing considerations, creating an environment ripe for billing and payment inaccuracies.

This comes at a time when healthcare organizations may be particularly vulnerable to fraud, waste and abuse in light of relaxed regulations and suspended payment integrity activities. Dr. Gary Call, Chief Medical Officer for HMS, says that although putting some of these activities on hold was necessary to alleviate the burden on hard-hit providers during the virus’ initial peak, a more contextual approach is needed to ensure an appropriate response moving forward.

“Now that we have more data, we need to be making analytics-driven decisions based on the numbers, rather than taking a one-size-fits-all approach,” Call said. “The situation has varied by state, region and country; assessing the regional impact and what measures have and haven’t been effective can inform better decision-making around capacity planning and cost containment.”

Listening to the Science; Following the Data

Without question, alleviating provider burden must remain a top priority during and after the pandemic. And while this includes reevaluating payment integrity activities to avoid administrative overload, healthcare organizations should be focusing on whether the measures taken have been effective in advancing this goal.

It also requires organizations to look at the situation on a case-by-case, region-by-region basis to ensure the actions fit the circumstances. With the industry losing tens of billions dollars a month during the height of the pandemic, recovery will be a difficult and likely years-long endeavor. Elective procedures comprise a substantial portion of hospital revenue; looking at the data to determine when and how to resume payment integrity activities along with these services will be critical to the effort.

Facilitating Payment Accuracy During & Post-Pandemic

There are a number of techniques to maintain payment integrity activities while balancing the burdens on providers through today’s crisis and beyond. These may include continuing automated reviews, facilitating electronic document transmission and potentially instituting post-payment audits as a replacement for burdensome prior authorizations during high-demand periods. Healthcare payers should also take steps to maintain their audit rights for periods when payment integrity audits were placed on hold. Ultimately, the focus should be on engagement — both in equipping providers to deliver quality care and educating consumers on the importance and safety of accessing the care they need.

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