CMS Issues Policy for Recalcitrant Providers

The Centers for Medicare & Medicaid Services (CMS) has issued manual updates to address providers termed as “recalcitrant.” CMS’ definition of “recalcitrant” providers are those who have a history of prolonged program abuses and refuse to comply with Medicare coverage rules. These providers have been on a pre-pay medical review for years and continue to show no improvement in inappropriate behavior.

CMS will apply two sanction authorities that currently exist under the Social Security Act at 1128A(a)(1)(E) for civil money penalties and 1128(b)(6) for civil money penalties and/or exclusion from Medicare and State Health Care programs. Both of these sanctions are delegated to the Office of the Inspector General.

The contractors are instructed to consider the following criteria before referring a recalcitrant provider to CMS Region Office and The Program Integrity Fraud and Abuse Suspensions and Sanctions (FASS) Team for further action:

  • The provider being considered for referral by the Medical Review Unit should not be under any fraud investigation by the Program Safeguard Contractor (PSC)/Zone Program Integrity Contractor (ZPIC) or active with the OIG (the MAC and the ZPIC shall include this coordination in the joint operating agreement (JOA); and
  • The provider is currently on prepayment medical review, has been educated and continues to show a pattern of inappropriate behavior (do not include providers who are demonstrating improvement, however slight, as a result of education); and
  • The contractor demonstrates the administrative burden (i.e., volume and dollars of claims being manually reviewed, volume and dollars of claims/services being denied, and associated resource costs); and
  • The appeal history of denied claims indicate a low reversal rate (exclude potential case if claims have a high reversal rate); and
  • The Medical Director concurs with the medical review determinations and is aware that he/she may be a potential witness.

In order for CMS to approve or disapprove a notice for a recalcitrant provider the following elements will be reviewed:

  • What are the specific medically unnecessary services/items or non-covered services being provided and billed;
  • What are the grounds for these services/items being medically unnecessary or covered;
  • What education was provided to the provider to inform and correct the provider’s pattern of inappropriate behavior;
  • A description of the pattern of inappropriate behavior, including how the provider continued to provide medically unnecessary services/items or non-covered services after explicit education from the contractor;
  • Appeal history (through ALJ level); and
  • Availability of “Expert” witnesses being prepared to testify if necessary (Medical Director).
  • CMS will notify the MAC and PSC/ZPIC of approval and then coordinate with the PSC/ZPIC before they will refer the provider/supplier to the MAC for revocation.

CMS states a provider that has been on prepayment review for years could be considered recalcitrant, but does not comment on how many years the provider must be on repayment review before they are a considered a recalcitrant provider.

To view the Change Request, please click here.

Source: NAHC

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