CMS’ Regulatory Changes specifically in RAP(Request for Anticipated Payment)
We have been dealing with a lot of drastic changes for the past year, and many Home Health providers like you are very much concerned on how to keep the business up and running in the coming months or years. Center for Medicare & Medicaid Services released the final Home Health Proposed Payment Rule for CY 2021. This article is intended for you to have an overview of the changes specifically with Request for Anticipated Payment (RAP) phase out.
No-Pay RAPs and New RAP Criteria
With the current billing process, you have to bill a RAP for every 30-day period which allows you to obtain 20% of the anticipated payment for a patient’s care episode before an actual care is administered. Effective January 1, 2021, no more reimbursements will be issued upon initial RAP billing because according to CMS, RAPs can possibly lead to potential fraud. One good thing about this change is that the new RAP requirements are now much less. You can now bill both RAPs of the 30-day period and the second 30-day period at the start of care (SOC) which means Medicare is now allowing you to bill both RAPs upfront or at the beginning of every episode even if it has not been administered yet. In addition to this, CMS also confirmed the elimination of OASIS as part of the initial process for becoming a Medicare-participating HHA.
Penalty for Late RAP Submissions
There is also a heightened emphasis on a non-timely submission which will lead to payment reduction. RAPs must not only be submitted but also ACCEPTED within 5 calendar days of the beginning of the 30-day payment period or within 5 calendar days of day 31 for the second period otherwise, the agency will be penalized a daily rate up until the RAP is accepted.
Here’s a sample computation:
Estimated HIPPS amount is divided by 30 which is equal to your daily rate. You shall then multiply the Daily Rate to the number of days the RAP was not ACCEPTED.
30 day billing
Billing was submitted and ACCEPTED 18 days later
Estimated HIPPS amount: $3,000
$3,000/30 = $100 Daily Rate
$100 x 18 = $1,800 Penalty & Revenue Loss
$3,000 - $1,800 = $1,200 Remaining earnings due to the penalty
Considerations to Waive Penalty
CMS still considers certain unavoidable events that can qualify as an exception to waive penalty. Firstly, natural disasters such as fires, floods, earthquakes and other unusual events that inflict extensive damage to the HHA’s ability to operate. Secondly, data filing problem due to CMS or MAC system issue that are beyond HHA’s control. Another possible exception is for newly Medicare-certified HHA. Lastly, other unforeseen circumstances determined by CMS. On the other hand, Low Utilization Payment Adjustment 30-day period of care, if an HHA fails to submit a timely RAP, no LUPA per-visit payments would be made for visits that occurred on days that fall within the period of care prior to the submission of the RAP.
What to expect in 2022
RAPs will no longer exist in this year, and will now be replaced by a NOA or Notice of Admission. This results to billing of 1 claim instead of the current 2 claims. NOA will be submitted upon admission of the patient to home health care, and it must also be billed and accepted by MAC within 5 days of SOC date otherwise, same penalty as mentioned will apply.
Action steps to consider
This will be the perfect time to revisit and review the dates when your RAPs are currently being submitted. If it resulted to more than 5 days, that habit must be changed immediately. Review coding time frames. Consider only the primary diagnosis just to get out the required RAP submission within 5 days. Take the time to review SOC visit completion time frames as well. Lastly, you may want to establish a software to use or at least contact an expert to seek pieces of advices on New RAP requirement to basically know the best way to file that 2 RAPs at the beginning easily.