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Cardiovascular, surgical procedures are targets

The American Hospital Association reports that 88% of all hospitals responding to its RACTrac Web-based survey have received an audit under the Recovery Auditor (RA) program.

The top five medical necessity diagnoses that get denied by the RACs are coronary stents, syncope, chest pain, miscellaneous intestinal disorders, and transient ischemic attack, according to the RACTrac. Syncope and collapse and stents were the top DRGs with the most financial impact denied by the RAs, according to the survey.

“Hospitals are admitting patients with these five diagnoses and Medicare is taking back the reimbursement for a significant portion of them. The RACs are saying that these are not emergent inpatient conditions and that the services could be provided on an outpatient basis,” says Brian Pisarsky, RN, MHA, ACM, director in Huron Healthcare’s Clinical Operations Solutions, with headquarters in Chicago.

Many hospitals encourage physicians to automatically order observation services for patients who present to the emergency department with syncope or chest pain, although some patients meet criteria for an inpatient admission, says Deborah Hale, CCS, CCDS, president and chief executive officer of Administrative Consultant Service, a healthcare consulting firm based in Shawnee, OK. The thinking is that because there is a preponderance of denied claims for these conditions, all patients presenting with syncope or chest pain should receive observation services, Hale says.

“If you follow screening criteria, there are high-risk patients with syncope who should be admitted,” she says. Typically, patients who present with syncope are at higher risk when they have certain chronic conditions, such as valvular heart disease or cardiomyopathy, she adds.

In a significant number of cases, recovery auditors are denying reimbursement for admissions for transient ischemic attacks because the auditors determine they didn’t meet inpatient criteria and their admission was not medically necessary, Pisarsky adds. To avoid denials, make sure the documentation in the medical record reflects the severity of illness and that the physician fully documents why he or she thinks the patient should be admitted in inpatient status, rather than receiving observation services, he adds.

CMS established the Comprehensive Error Rate Testing (CERT) program to monitor the accuracy of claim payments in the Medicare fee-for-service programs. The CERT Documentation Contractor randomly selects a small sample of Medicare fee-for-service claims and sends them to the provider, requesting specific documentation for the services billed. The contractor sends the documentation to the CERT Reviewer Contractor, which analyzes them for compliance with Medicare coverage, coding, and billing rules. When an error is determined, the claim is adjusted by the MAC and the money paid to the provider is taken back.

Under the CERT program, orthopedic surgical procedures, particularly hip replacement and knee replacement surgery, are coming under scrutiny for medical necessity, Pisarsky says. Many times, the documentation that shows medical necessity for the procedure is documented in the surgeon’s records but not the hospital record.

“In many cases, physicians have worked with joint replacement patients, sometimes for years, and have tried pain medicine, injections, physical therapy, and other interventions but the hospital doesn’t have access to this information in their electronic medical record. When a claim is denied, hospitals have to get the information from the physician’s office, which can be especially difficult if the physician’s electronic medical records don’t interface with the hospital’s,” he says.

Insurance companies request information to precertify procedures, but hospitals have depended on physicians, he adds. Pisarksy suggests having a case manager review elective surgery cases after they are scheduled to make sure all the information to support medical necessity for the procedure before the surgery takes place. “If you do the legwork up front, it will be much easier than waiting until there’s a denial,” he says.

The CERTS are not only scrutinizing certain surgical procedures but also are requesting records for three-to-five day admissions when patients are transferred to a skilled nursing facility. If the patient didn’t meet medical necessity for an inpatient stay for three midnights, the CERTS are denying the entire stay. In addition, the skilled nursing facility may also encounter reimbursement problems for the skilled admission.

Pisarsky suggests that case managers verify prior to the transfer that every patient being transferred to a skilled nursing facility after a three-to-five day stay meets medical necessity for at least criteria for three consecutive midnights.


  • Amanda W. Berglund, MBA MS, partner in Pace Healthcare Consulting, LLC, Hilton Head, SC. Email:
  • Deborah Hale, CCS, CCDS, president and chief executive officer of Administrative Consultant Service, Shawnee, OK. Email:
  • Brian Pisarsky, RN, MHA, ACM, director in Huron Healthcare’s Clinical Operations Solutions, Chicago. Email:
  • Pat Wilson, RN, BSN, MBA, case management director, Medical City Dallas Hospital. Email: