We may be rightly accused of harping on this theme a lot but it is important enough to revisit from time to time. Beware of those who would scare you into focusing on the government’s future revenue protection program, the Recovery Audit Contractors (RAC), so much that you lose sight of current programs. Some of them, such as the Zone Program Integrity Contractor (ZPIC) program, have the power to harm your business while the RACs are still decorating their new offices.RACs and ZPICs are not all that dissimilar
Even though the collection agencies that have won Recovery Audit contracts will be paid a percentage of what they take back from Medicare providers and ZPICs earn flat fees regardless of the dollar amounts they recover, ZPICs still have plenty of financial incentive.
Consider one corporation’s ZPIC contract, AdvanceMed Corporation which will cover Zone 5. It will be worth nearly $108 million over five years. They may not exactly be bounty hunters like the RACs but they are certainly financially motivated. Certainly they know their performance will be a consideration at contract renewal.
ZPICS are tasked with examining billing trends and patterns, not single-episode medical necessity or missing signatures on documents. They will compare your billings with your area’s averages and means. If you are significantly higher overall than most other providers of your type in your community, they will pay you a visit.
The RACs, on the other hand, will be looking for specific types of services. They will be interested in whether you are treating patients who are eligible for a certain benefit and whether you are treating those patients with care plans that fit the norms.
For background on what RACs are currently focused on, remembering that home health care issues are still not on their lists, see the article in our last issue, “CMS Approves New Overpayment Issues for RACS.” It refers to issues such as “Urological bundling,” “Excessive blood transfusion units,” and “Newborn Pediatric CPT Codes Billed for Patients Exceeding Age Limit.” Interesting but irrelevant for most home health care agencies so far.
ZPICs are looking for fraud. RACs are not. Therefore, a ZPIC takeback suggests a criminal accusation where the future RAC overpayment recoupments will be all about the money. They have the option of telling enforcement agencies about you but they cannot make their own fraud accusations. ZPIC refer all cases of potential fraud to the Office of Inspector General (OIG) for consideration of criminal prosecution.
Origins
Fiscal Intermediaries were once the front line of fraud and abuse enforcement. While they continue to act in that capacity, it is being phased out. CMS created Program Safeguard Contractors (PSC) about ten years ago but there was no correlation of geographical regions between FIs and PSCs. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) addressed that disparity by introducing the concept of Medicare Administrative Contractors (MAC), which are gradually replacing FIs and Carriers. They will be responsible for processing your Medicare claims but not for overpayment and fraud enforcement. That will be handled by PSCs, now known as ZPICs, and their regions will match MAC regions.
Plus, ZPICs will look for fraud, waste and abuse among all providers in their region. CMS has decided that examining data across all providers will lead to better detection and enforcement than separating hospital audits from physicians and post0acute providers. The new MAC/ZPIC zones will be:
- Zone 1 - California, Nevada, American Samoa, Guam, Hawaii, and the Mariana Islands.
- Zone 2 - Alaska, Washington, Oregon, Montana, Idaho, Wyoming, Utah, Arizona, North Dakota, South Dakota, Nebraska, Kansas, Iowa and Missouri.
- Zone 3 - Minnesota, Wisconsin, Illinois, Indiana, Michigan, Ohio, and Kentucky.
- Zone 4 - Colorado, New Mexico, Oklahoma, and Texas. (Contract awarded to Health Integrity, LLC)
- Zone 5 - Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Virginia and West Virginia. (Contract awarded to AdvanceMed but currently under challenge by a competitor)
- Zone 6 - Pennsylvania, New York, Maryland, Washington D.C., Delaware, Maine, Massachusetts, New Jersey, Connecticut, Rhode Island, New Hampshire, and Vermont.
- Zone 7 – Florida, Puerto Rico and Virgin Islands. (Contract awarded to SafeGuard Services, LLC)
With contracts awarded and not challenged, Zones 4 and 7 have begun operations but CMS has not indicated when the other contracts will be awarded.
ZPIC expected procedures
To identify fraud, ZPICS will not actually knock on your door and ask to spend a week pouring over hundreds of patient charts, though technically they do have the authority to demand charts if they want to determine whether a service was actually provided and was medically reasonable and necessary. No, ZPICs will live almost entirely on the other side of the world of databases from you. Their databases will pull from the CMS National Claims History (NCH), which aggregates claims data from fiscal intermediaries and carriers such as Regional Home Health Intermediaries and Durable Medical Equipment Regional Carriers (DMERC) as well as intermediaries that serve hospitals and physicians.
If there is a relationship between RACs and ZPICs, it is that RACs, which have no authority to investigate and prosecute fraud, will report any suspicions they may develop to ZPICs. This means that a successful overpayment recoupment at the hands of a RAC can be followed by a fraud investigation by a ZPIC that covers identical material.
Conclusion
There are any number of book publishers, webinar producers and independent consultants ready to exchange your money for tools to learn about and protect yourself from Recovery Audit Contractors. While it is true that you may need protection from them someday, most of them have not yet learned how to spell home health care. They work on commission. Going after home health care providers would be like walking the beach with a metal detector when the adjacent hills sit above diamond mines. Hospitals and physicians are far more attractive to bounty hunters than you are.
However, word is out that Medicare fraud is easy and lucrative in home nursing and especially home medical equipment. It has attracted the criminal element that grew tired of running drugs and getting shot at on the street and risking much longer prison terms. ZPICs, specifically charged with finding fraud, are quite likely to make themselves known to you long before your local RAC does. Focus on ZPIC payment threats first, RACs later, especially if you are in Zone 4 or 7, where they probably already know your name.
