CMS Prepares to Validate HIPPS on Claims Prior to Payment

The Medicare providers paid under prospective payment systems based on patient assessments include home health (HH), skilled nursing facilities (SNF), and inpatient rehab facilities (IRF). At this time, the Medicare Fiscal Intermediary Shared System (FISS) does not have access to the databases where these assessments are stored. As a result, the Centers for Medicare & Medicaid Services (CMS) is unable to verify that the case-mix group recorded on claims matches that in the assessment databases.

In one of its latest efforts to ensure correct payment of Medicare claims, CMS undertook an analysis of actions needed and initiated a plan to create a systematic validation of HIPPS codes against assessment data prior to payment. This plan will be implemented in phases, starting with IRFs. Although a date has not yet been determined for implementing this process for home health claims, agencies should be make certain to take necessary steps to be prepared for this.

As a result of this work “FISS will suspend claims with HIPPS codes and create a finder file of claim information of the mainframe at each MAC’s Enterprise Data Center (EDC).” Through a file exchange process claims files will be transmitted to the CMS Data Center where the corresponding assessment, which generates the Health Insurance Prospective Payment System (HIPPS) code, will be located in the Quality Improvement Evaluation System (QIES), and verified. If the HIPPS code, which is generated from the assessment, is different than that on the claim, the MAC will use the information from the QIES to calculate payment for the claim. If the assessment is not present, the MAC will return the claim to the provider, indicating no assessment on file.

MACs were issued instructions in Transmittal 25495 (CR7760) to implement the assessment verification process for IRFs by October 1, 2012. Instructions for testing and activating HH and SNF processes will be issued to MACs at a yet undetermined date. In preparing for the application of this process to home health, agencies that use outside vendors rather than HAVEN to generate HIPPS codes should verify the HIPPS codes that their software generates against HAVEN prior to submitting claims. Additional information about this new validation of payment groups process can be found in Transmittal 2495 and the corresponding MLN Matters article.

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