Emergency physicians and hospitals increasingly frustrated with length of audit process, delayed reimbursement on successfully appealed claims

Consultants and billing experts say emergency physicians and the hospitals they work in are increasingly frustrated with the growing length of the entire audit process—including getting paid back for denied claims that have successfully appealed.  

James Blakeman, senior vice president of the billing company Emergency Groups’ Office in Arcadia, Calif., said that delayed reimbursement can be damaging to hospitals, in particular, as those amounts are typically for hundreds of thousands of dollars. While individual payment denials to emergency physicians are “not usually material to a practice’s financial viability,” the implications of multiple held-up payments can be so significant physicians have no choice but to fight them, he said.

“Physicians cannot simply concede an audit if they know they are right because Medicare claims that these are all ‘educational,’” Mr. Blakeman said, adding, “You are made to feel like you have committed fraud and that someday they could say, ‘We told you before that you were billing in error, now we are opening a large audit because you acknowledged (by not contesting before) that you were coding incorrectly.’ That result could be disastrous. Injustice and fear of future audits are what haunt emergency physicians when they think about billing Medicare and Medicaid.”

Practicing emergency physician John Stimler, DO, CPC, CHC, FACEP, a founder and managing member of health care consultant Bettinger, Stimler & Associates of Pinecrest, Fla., said he hears of too many groups that don’t defend themselves. While he doesn’t approve of that, he said it is understandable given the staffing and financial burden of mounting an aggressive defense.

“A lot of groups give up because they don’t want to spend the money to do it,” said Dr. Stimler, a member of ACEP’s Reimbursement Committee. “It becomes a double-, or triple-, or quadruple-edged sword. You not only lose the money between the code choices, but you have to pay for the staff to defend yourself. All those steps are very expensive.”

The process is also time consuming. If a hospital, physician group, or solo practitioner wants to appeal a Recovery Audit Contractor decision, it has 120 days to file what is known as a “redetermination,” which is conducted by Medicare carriers or MACs. While the appeal deadline is 120 days, one can only avoid a Medicare recoupment action if the appeal is filed within 30 days. A second level of appeal is known as “reconsideration,” and is conducted by Qualified Independent Contractors (QICs). Then a case can be appealed to an administrative law judge. Above that level, appeals can be filed to the U.S. Department of Health and Human Services or a federal court.

“You’re talking about issues that may drag out longer than a year,” Dr. Stimler said.

Most cases stop at the administrative law judge level; however, the timeline to get there has grown dramatically. In a memo released earlier this year, Nancy Griswold, the chief judge of the Office of Medicare Hearings and Appeals, suspended scheduling new hearings. She wrote, “We do not expect general assignments to resume for at least 24 months.” In a related hearing before Congress, Ms. Griswold presented data showing that that received appeals more than doubled, from 117,371 in fiscal year 2012 to 350,629 in fiscal year 2013. Decided appeals rose from 61,517, to 79,303 in the same period, a 29% increase that couldn't keep pace.

“Hence the big complaint that it’s taking forever for appeals to get resolved because the OMHA is overwhelmed,” said Mr. Blakeman.

“This is as bad as it’s ever been,” said Denise Wilson, assistant vice president of consulting firm AppealMasters of Lutherville, Md.

For Mr. Blakeman, the biggest impact on emergency physicians is “the injustice of it.”

“The audit process is broken,” he said. “Emergency physicians feel that you try to do the right thing for the patient but you can still lose your [Medicare] billing privileges if an auditor just has a bad day and picks you to unload all his or her mistakes on that day. It’s just not right. And the defense costs are unnecessary. We pay the cost of the federal audit process being poorly run.”

Richard Quinn is a freelance writer in New Jersey.