If you’re not already actively using your hospital’s PEPPER (Program for Evaluating Payment Patterns Electronic Report), you’re missing out on a lot of valuable data.
As healthcare data continues to become the industry’s newest hot commodity, coding managers are remiss if they don’t review any and all information that comes their way. Data—including coded data—drives pay-for-performance, meaningful use, auditing targets, and more. Being ‘in the know’ about what your hospital’s data says in terms of the care provided is essential.
Seize your PEPPER
PEPPER provides Medicare claims data statistics for areas that the OIG, Quality Improvement Organizations, Medicare Administrative Contractors (MAC), and Recovery Auditors (RA) identify as being at risk for improper payments. It uses aggregated data to allow hospitals to see how they stack up against others in the state, jurisdiction, and nation.
The report, published by TMF Health Quality Institute, identifies potential over- and underpayments that hospitals can focus on internally. It also prioritizes specific target areas and provides guidance in terms of auditing and monitoring those targets.
Coding target areas include the following:
- Stroke and intracranial hemorrhage
- Respiratory infections
- Simple pneumonia
- Septicemia
- Unrelated operating room procedures
- Medical DRGs with CC or MCC
- Surgical DRGs with CC or MCC
- Excisional debridement
- Ventilator support
- Single CC or MCC
PEPPER also targets the medical necessity of various conditions. In addition, it includes 30-day readmissions to the same hospital or elsewhere and short stays (i.e., one- and two-day stays).
A hospital has an outlier if its percent in a particular target area is at or above the 80th percentile or is at or below the 20th percentile.
“Use the PEPPER if you haven’t already done so as your starting point and launching point,” says Ralph Wuebker, MD, MBA, chief medical officer at Executive Health Resources in Newtown Square, PA.
Various hospitals have shared information about how they’ve used PEPPER proactively. The PEPPER Web site provides testimonials about how hospitals are using the report.
Coding managers are encouraged to access their own PEPPER when it’s released each quarter, says Yvonne Focke, RN, BSN, MBA, consultant at Advanced Patient Solutions, LLC, in Loveland, Ohio. “Multiple departments, such as HIM and care management, should be able to see these and assess any outlier status,” she adds.
When hospitals have outliers in a particular risk area, they should audit their medical records to determine whether a compliance problem exists, says Focke. “Some facilities may choose to review concurrently rather than retrospectively,” she says. “Auditing your own records may prevent providers from being accused of reckless disregard and/or deliberate ignorance.”
For example, if a hospital’s target area for simple pneumonia is low, and its target area for respiratory failure is high, coding managers may want to question whether coders are overcoding, says Focke.
Keep in mind that not every outlier suggests noncompliance, says Focke. One or more of the following factors can inadvertently affect risk status or outlier status:
- Changes in admission practices
- New physician
- New coding or care management staff
- Implementation of a CDI program
- Change in patient population
- New service lines
It’s important for hospitals to implement a quality improvement process around any outlier, says Focke. This ensures that hospitals can support their practices if an auditor ever questions them.
“It’s just not worth having all of the denials and audits on the back end. Always look for opportunities to improve,” she says. “Seize those opportunities and be proactive. Keep the money at your institution instead of having to return money. When a claim is paid, we want it to stay paid.”
PEPPER and proposed IPPS changes
In addition to assisting with internal auditing, hospitals can also use PEPPER to determine the potential impact of proposed changes for 2014, says Wuebker.
In its FY 2014 IPPS proposed rule, CMS proposes to define appropriate inpatient stays (i.e., stays that are appropriate for payment under Medicare Part A) as medically necessary stays that span two midnights in the hospital setting. Previously, CMS set benchmark at 24 hours.
This proposal could magnify a hospital’s compliance problems related to length of stay, says Wuebker. Hospitals can use PEPPER now to get a handle on those problems, identify what specific DRGs may be at risk, and implement a strong utilization management process proactively.
If you haven’t already visited the PEPPER Web site, check out the following links:
- PEPPER User’s Guides for specific providers
- National-level data reports
- Medical necessity coding and audit tools to prevent improper payments
PEPPER is one of many resources on which hospitals can rely to better understand their data, says Wuebker. CMS provides provider-specific probe letters that inform providers when they have been selected for prepayment claims reviews. These letters also provide a comparative billing report.
MACs may also provide educational tip letters to providers regarding Medicare non-covered services. These letters provide education specific to each denial as well as suggestions and CMS references to help prevent similar denials.
The goal is to stay abreast of these and other publications—as well as regulatory changes—so you can ensure that what your data says is accurate, says Focke.
Editor’s note: The content in this article was originally presented during HCPro’s audio conferenceOptimizing PEPPER in the Audit Environment. Eramo is a freelance writer and editor in Cranston, R.I., who specializes in healthcare regulatory topics, health information management, and medical coding. You may reach her at leramo@hotmail.com.