Opportunities in a New Compliance Paradigm
By Carrie Barr and Shawn R. Deane

Part II

In part two of this article, we explore how to develop a holistic and programmatic approach to Medicare Secondary Payer obligations.

Repurposing Section 111 Data

Using Section 111 data to drive the conditional payment process in an automated and self-executing fashion is the foundation to develop a holistic and programmatic approach to Medicare Secondary Payer obligations. Primary payers can appropriate the query response information to identify claims that are ready to initiate the conditional payment process. No longer are query responses merely flags to determine if ORM or TPOC events may be reportable in the future. Instead, this valuable data should be repurposed and used to drive the Medicare conditional payment process.

Automation and Using Technology

Through the development of customized data aggregation to identify conditional payment cases from the Section 111 data feed, a system for initiating the conditional payment process can be implemented by way of:

  • enabling an automated self-executing sequence for extracting Section 111 data
  • instituting streamlined internal workflows and referral protocols
  • employing smart prompts and flags for missing data
  • identifying predetermined thresholds for all decision points throughout the conditional payment process

Moreover, existing technology, such as the Medicare Secondary Payer Recovery Portal, can be used once a recovery case is established with the BCRC. The portal has dramatically reduced many of the time-consuming activities associated with processing conditional payments. Strategic use of the portal combined with a programmatic process compounds the benefits.

100 Percent Compliance

The underlying goal in developing this programmatic approach is to obtain as close to 100 percent compliance as possible. When operating in an inefficient Medicare compliance environment and attending to claims ad hoc, there is more room for noncompliance and errors, thus increasing risk and exposure. In this new model, conditional payments are addressed for every Medicare beneficiary identified through the Section 111 process. Administrative decision points are removed from the equation, and reporting safeguards can be incorporated to ensure zero tolerance for potential compliance failure.

What does it mean?

  • RRE: responsible reporting entities
  • ORM: ongoing responsibility of medicals
  • TPOC: total payment obligation to claimant
  • BCRC: Benefits Coordination and Recovery Center 
  • COBC: Coordination of Benefits Contractor
  • MSPRC: Medicare Secondary Payer Recovery Contractor

Increased Visibility: Identifying Risk and Exposure

When claims are handled on a one-off basis for MSP compliance attention, it is often difficult to monitor the efficacy of a program. Data relative to the measurement of success and potential exposure is frequently isolated or not captured at all. However, under a holistic approach that addresses every Medicare claim, primary payers can now have unprecedented visibility into:

  • viewing Medicare exposure across the entire enterprise and by line of business
  • determining the sources of exposure, claim by claim and in the aggregate, to refine compliance protocols, especially in the area of identifying prompts for cost mitigation opportunities
  • calculating compliance program ROI
  • determining turnaround times for compliance processes
  • measuring and monitoring metrics in areas that have been successful and in areas that need improvement (identify points of potential compliance “leakage”)
  • providing an audit-ready trail for compliance activities

Time Savings

The programmatic process of identifying claims appropriate for conditional payments will avoid the administrative efforts of one-off referrals for services. Fixed protocols surrounding thresholds for initiating Medicare conditional payment disputes — and for any decision point in the process — will remove time-consuming administrative decisions. This new programmatic model for MSP compliance:

  • frees up adjuster resources
  • decreases the time it takes for certain critical conditional payment activities
  • moves claims toward faster settlement and resolution
  • mitigates delays and unanticipated factors inherent in Medicare compliance

Reducing Costs and Exposure

Addressing Medicare conditional payments programmatically allows primary payers to capitalize on potential dispute opportunities to eliminate conditional payment costs and exposure.

As an example of the potential results in this type of model, here are some statistics from a large national workers' compensation insurer that opted for a programmatic approach to disputing conditional payments:

  • In 2013, more than 3,7009 Medicare conditional payment letters were obtained for this insurer.
  • A total of 479 conditional payment cases were determined to be ripe for conditional payment cost mitigation potential.
  • Of those 479 cases, conditional payment amounts totaled $3,992,496.15 in potential exposure.
  • In the aggregate, postdispute amounts totaled $565,072.38.
  • This resulted in $3,427.423.77 in Medicare conditional payment exposure and cost savings for this particular insurer.

By looking at Medicare compliance using this holistic model, primary payers have an exceptional opportunity to capitalize on a programmatic approach. Such an approach offers almost 100 percent compliance through a streamlined process that will save time and money and mitigate against potential risk and exposure — and provide unprecedented visibility into the Medicare compliance process.

Carrie Barr is senior vice president of Sales and Services at ISO Claims Partners, a leading national provider of services that assist insurers, third-party administrators, and self-insureds with requirements related to Medicare compliance and improving claims outcomes.

Shawn Deane, Esq., is director of product development at ISO Claims Partners.

« Back to part I

  1. Out of 3,701 letters, approximately 1,200 were zero-dollar ($0.00) conditional payment letters with no dispute potential.