Circumvention of Prospective Payment System (PPS) –

7440 - Circumvention of Prospective Payment System (PPS) – (Rev. 4, 07-18-03) Circumvention of Prospective Payment System (PPS) is a hospital action that results in the unnecessary admission or multiple admissions of an individual entitled to benefits under Medicare Part A. §1886(f)(2) of the Act provides that the Secretary determines, although based upon information supplied by the QIO, the prohibited actions have taken place, and the Secretary denies payment. Therefore, the provisions of §1869 of the Act and 42 CFR 405, which deal with appeals from non-QIO payment denials, are applicable and provide for ALJ, Appeals Council, and judicial review. Under the Medicare program, circumvention of PPS denials are considered to be initial denial determinations that give further reconsideration and appeal rights to hospitals. Therefore, a hospital dissatisfied with your initial denial determination for circumvention of PPS may request a reconsideration regardless of the amount in controversy (See 42 CFR 405.710(b)). Do not notify the beneficiary or physician of your reconsideration determination (See §7430.G.1 for reconsideration notice requirements) (See Exhibit 7- 50). Section 1886(f)(2) of the Act is directed only to hospitals that are reimbursed under PPS. Because physicians are not paid for services under PPS, a physician does not have an independent right to appeal an adverse determination under this section. The appeal right belongs to the hospital. The hospital may appoint the physician to act as its representative for an appeal or may call a physician as a witness if the appeal goes to a hearing before an ALJ. Although the physician(s) who provided the services during the denied Part A stay do not receive a copy of your denial notice, they do receive notice when the associated Part B payments are denied. Then he/she may separately appeal the denial of Part B services related to the Part A denial if he or she has accepted assignment of the claim from the beneficiary. Limitation on liability under §1879 of the Act does not apply to Part A denials for circumvention of PPS. If, however, the Part B services associated with the Part A denial are also denied, limitation on liability may apply. A. Listing of Documentation Required for Hearing Obtain the following documentation before you forward the file to OHA. If any of the evidence deemed necessary is not in existence, or is otherwise unobtainable, fully document this and explain.  Medical Records -- The medical record must contain information to justify admission and continued hospitalization, support the diagnosis, and describe the patient's progress and response to medication and services (See 42 CFR 482.24(c)). If possible, send a copy of the entire medical record. Generally, the medical record contains the following documents: • Consent to treatment statement; • Consultations, if any; • Demographics sheet (e.g., face sheet); • Discharge summary; • Discharge/transfer instructions; • Emergency department records, if any; • Graphic sheets; • History and physical; • Intake/output sheets; • IV flow sheets, if any; • Laboratory results (e.g., blood work, urine tests); • Medication records; • Nursing assessments; • Operative/procedural consent to treatment statement, if any; • Operative reports, if any; • Physician attestation statement; • Physician's orders; • Problem list, if any; • Progress notes (e.g., physician, nurse, other multi-disciplined practitioners); • Rehabilitation reports, if any; and • Test results (e.g., X-rays, MRIs, EKGs, CAT scans), if any.  QIO Documents -- Include the following documents from your files: • Notice of initial denial determination, including a determination on limitation on liability (See §7115 for denial notice content); • Request for reconsideration (See §7430.G.1 for reconsideration notice content); • Request for hearing; and • Reconsideration determination notice including a determination on limitation on liability. To support your reconsideration determination, include the following information:  The professional qualifications and experience of the physician reconsideration reviewer. Explain that in accordance with regulations governing disclosure of confidential QIO information you may not reveal the identity of the reviewer unless he/she gives his/her consent (See 42 CFR 480 and §7430); and  Rationale supporting the determination with the corresponding statute/regulation. Provide your rationale in your reconsideration letter so that it may be taken into consideration by OHA. It is not sufficient to add an explanation to the hearing file. To request a hearing, the beneficiary or his/her representative (whose appointment has been properly documented) may send a letter or submit OHA's Form CMS-5011-U6, Request for Hearing (see Exhibit 7-62). If a beneficiary submits a letter requesting a hearing without Form CMS-5011-U6, fill out Form CMS-5011-U6 and attach the incoming letter and the form to a letter to OHA that includes the following statement: "See attached letter dated." Staple the letter and the postmarked envelope in which it arrived to the hearing request form. You are not responsible for completing Form SSA- 1696-U4, Appointment of Representative. Instead, check the appropriate blank under Item 19A on Form CMS-384, QIO Case Summary, indicating whether a completed beneficiary representative form is on file. NOTE: Upon receipt of a request for hearing, it is imperative that you date-stamp the request. A request is considered filed on the date it is postmarked (see 42 CFR 478.42(b)(3)). Also, retain a copy of the envelope in which the request for hearing was received in order to have a record of the exact date a request was filed.  Other Pertinent Documents -- Include the following pertinent documents in your file: • Hospital denial notice, preadmission/pre-procedure denial notice and the physician's response to the pre-denial notice. These documents may be the only records in the file if the beneficiary was never subsequently admitted to the hospital or the procedure was never performed following a preadmission/pre-procedure denial; • Copies of prior denial notices that involve the same or reasonably comparable conditions. These are especially important for appeals made under the limitation on liability provision; • Copies of the laws and regulations not otherwise referenced in your determination on which you relied; • Copies of relevant review criteria with a statement explaining that you developed the review criteria with the assistance of specialty physicians from your State and that they are medically recognized indicators of care that reflect local standards of medical practice. Also, include a copy of CMS' generic quality screens that have been applied to the case, if appropriate; • Copies of the actual document/bulletin/Memorandum of Understanding (MOU) containing the information given to the provider community. Reference actual documents sent to the hospitals, which may include relevant pages of the QIO Manual; and • All appropriate billing forms and current benefit data from the claim history. If billing forms and benefit data are not available in the file, request that the Fiscal Intermediary (FI) send this information to the appropriate hearing office (See Exhibits 7-63 and 7-64). Do not hold the hearing folder if you only need FI data. Forward the folder directly to OHA. NOTE: These documents support your determination. ALJs rule based on preponderance of evidence. The parties to the appeal can bring medical specialists and lawyers to the hearing to establish evidence on their behalf (Party is legally defined as "a person or group involved in a legal proceeding"). However, because neither CMS nor the QIO is a party, ensure that the file forwarded to OHA is as complete as possible. B. Assembling the Hearing Claim File Place all hearing requests in folders before you send them to the hearing office. Each folder must contain the beneficiary's Health Insurance Claim Number (HICN) (i.e., Medicare number) on one line followed directly underneath by the surname, first name, and middle initial (if known). All claims material that pertains to services in question, including the envelope in which the request for hearing was received, must be profiled in this folder in chronological order by type of evidence (e.g., nurse's notes, physician's orders) with the most current material on top. To provide the ALJ with a concise overview of your determination, add a sheet with the qualifications and experience of the physician reconsideration reviewer and his/her rationale supporting the determination with the corresponding statute/regulation. Include documents to support your limitation on liability determination.