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at 11:57:03 AM on Friday, November 21, 2003

Appeal for Downcoding & Bundling Denials

 

Breaking News

950,000 MD's Settled With Aetna & Cigna on ERISA

HOPPS CCI EDITS                Physicians CCI EDITS

 

 

What You Should Know about Filing Your Health Benefits Claim

New Federal Claim Regulation, effective January 1, 2003, is the best and the most powerful protection for improper medical necessity denials:

 

Plan must disclose all the "secrets" under new definitions of relevant documents with better disclosure obligations, no more medical necessity secrets, UCR fee schedules & Bundling/Downcoding are no longer confidential. [Page 70252 & 70271, CFR § 2560.503-1(m)(8)  (DOL FAQ B-5, C17)]

 

Bundling And Down Coding, How To Fight Against Our Nation’s No. 1, The Most Important And Popular, Medical Claim Partial Denials?

© Jin Zhou,  ERISAclaim.com

 

 

 

Managed-Care Bundling And Down Coding Denial & Crisis? What Does an Unanimous US Supreme Court Say?

 

On June 21, 2004, an unanimous US Supreme Court ruled that claim processing (bundling and down-coding as partial benefits determination & denials, DOL FAQ C12)  and denials of benefits under the employer-sponsored health plans, ERISA-regulated benefit plans, for both self-insured and fully-insured (through purchase of insurance) health plans, are completely governed by federal law ERISA, that supersedes and invalidates state laws.

 

ERISAclaim.com: "employer-sponsored group health plans" = "ERISA-regulated benefit plans", both self-insured and fully-insured (through purchase of insurance) health plans, (ERISA - Title 29, Chapter 18.  Sec. 1002.)

 

ERISAclaim.com - Supreme Court Managed Care ERISA Watch

Aetna Health Inc. v. Davila

06/21/04

Opinion of the Court

 

"Held: Respondents’ state causes of action fall within ERISA§502(a)(1)(B), and are therefore completely pre-empted by ERISA §502 and removable to federal court. Pp. 4–20."

 

"We hold that respondents’ causes of action, brought to remedy only the denial of benefits under ERISA-regulated benefit plans, fall within the scope of, and are completely pre-empted by, ERISA §502(a)(1)(B), and thus removable to federal district court. The judgment of the Court of Appeals is reversed, and the cases are remanded for further proceedings consistent with this opinion.7 It is so ordered."

 

 

           I.     Bundling & Down Coding Claim Partial Denials Are Identified As The Number One And The Most Important And Popular Managed Care Hassles By AMA (PSA) Through Nationwide State Medical Associations And Medical Specialty Societies

  

Top Seven Issues through National Medical Specialty Societies

Rank

Problems Reported By Popularity Rank

  %

1

Bundling

67%

2

Medical Necessity Decision Denials

43%

3

Prompt Payment

43%

4

Administrative Hassles

33%

5

Coding Issues

24%

6

Downcoding

19%

7

Bargaining Lack of Negotiation Power

14%

 

Top Eight Most Importantly & Frequently Listed Issues through
State Medical Associations

Rank

Problems Reported By Importance Rank

1

Downcoding & Bundling

2

Prompt Payment

3

Lack of Budgeting Power

4

Medical Necessity Denials

5

Prior Authorization of Med. Services

6

Health Plan Credentialing

7

Drug Formularies

8

Other

 

 

 

 

II.              Solutions by AMA?

 

After extensive explanations of corrective coding initiative and exercising CPT editorial muscles and conclusion of national survey of downcoding and bundling as the most important and popular claim partial denials, AMA offered, through its web site and a free guide, the following solutions (on page 9 of AMA free guide):

 

  1. To appeal the claim denials and document all communications with insurer, referenced on “squeaky wheel theory” without practical instructions;
  2. To notify state, county and national medical societies and associations for advocacy strategies;
  3. To complete online AMA Health Plan Complaint Form.

 

“If a claim is filed correctly and the health insurer inappropriately bundles or downcodes, the physician should attempt to appeal the claim, by putting in writing a clinical justification for the appeal. The practice should document all communication with the insurer. While appealing claims obviously adds another administrative burden to the practice, there is a large element of truth in the “squeaky wheel” theory: an individual physician who is persistent, has good documentation, and is logically persuasive stands a better chance at succeeding than a physician who does nothing.3

 

 

The physician also should notify the relevant state and county medical associations and the relevant national medical specialty society. Those entities can then determine how widespread the problem is, and, if it is widespread, work with the AMA to develop an advocacy strategy. Finally, physicians should complete the AMA Health Plan Complaint Form, which can be accessed at www.ama-assn.org/go/psa. That information will be used to determine prevalence of these practices.” (© 2002, American Medical Association)

 

Apparently and practically, bundling and down coding partial claim denials remain to be the most popular and important healthcare claim partial denials in the U.S..

 

 

DOJ: Criminal Resource Manual 2432 Coercive or Fraudulent Interference with ERISA Rights -- 29 U.S.C. 1141

2432 Coercive or Fraudulent Interference with ERISA Rights -- 29 U.S.C. 1141

Title 29 U.S.C. § 1141 states:

 

"It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan, this title, section 3001, or the Welfare and Pension Plans Disclosure Act. Any person who willfully violates this section shall be fined $10,000 or imprisoned for not more than one year, or both. The amount of fine is governed by 18 U.S.C. § 3571. The U.S. Sentencing Guidelines address 29 U.S.C. § 1141 under the guidelines for "Fraud and Deceit" (U.S.S.G. § 2F1.1) or for "Extortion by Force or Threat of Injury or Serious Damage (U.S.S.G. § 2B3.2)......"

 

"For example, Section 1141 would reach the use of deception directed at misleading a welfare plan beneficiary as to the amount of health benefits owed to the beneficiary under the terms of the plan or at misleading a pension plan participant as to the amount of retirement benefits to which he would become entitled under the plan upon his retirement."

 

ERISA in the United States Code

ERISA 510 29 USC 1140 Interference with protected rights.
ERISA 511 29 USC 1141 Coercive interference.

 

 

Healthcare providers nationwide are left without sufficient understanding and effective appeal solutions in accordance with governing laws and regulations for bundling and downcoding partial claim denials.

 

After years  of frustration and struggling without practical solutions from national medical societies, state governments and federal government as well as state and federal courts, 950,000 physicians nationwide filed unprecedented lawsuits in class actions against more than 19 health insurers and managed-care organizations in federal court and state courts throughout the country.

 

Contrary to the popular understanding and healthcare expert's assertion that ERISA doesn't provide for managed care "bundling and downcoding" partial denial protections as state law does, ERISA  statutorily prescribes the regulatory appeal process for "bundling and downcoding" partial denial violations.

 

United States Supreme Court unanimously ordered on May 27, 2003 in BLACK & DECKER DISABILITY PLAN v. NORD that DOL FAQ (Benefit Claims Procedure Regulation), available on DOL web site, is the view of the Supreme Court and must be followed:

 

"It is the Secretary of Labor’s view that ERISA is best served by “preserv[ing] the greatest flexibility possible for . . . operating claims processing systems consistent with the prudent administration of a plan.” Department of Labor, Employee Benefits Security Administration, http://www.dol.gov/ebsa/faqs/faq_claims_proc_reg.html, Question B–4 (as visited May 6, 2003) (available in Clerk of Court’s case file). Deference is due that view." (Bold and underline added) Black & Decker Disability Plan v. Nord , U.S. Supreme Court, Decided 05/27/2003

 

      ERISA claim regulation compliance and enforcement will largely fix "bundling and downcoding" violations and crisis in U.S. healthcare delivery system.

 

 

 

III.            Class Actions by 950,000 Physicians and U.S. Supreme Court Ruling in PACIFICARE HEALTH SYSTEMS, INC. v. BOOK

 

After gaining preliminary victory on class certification for healthcare providers and losing class certification for patients tract claim, health insurers and managed-care organizations appealed to the United States Supreme Court.  Health insurers and managed-care organizations argued that healthcare providers’ claims must complete arbitration in accordance with managed-care contract signed by providers before proceeding to federal court, and U.S. Supreme Court agreed with health insurers and managed-care organizations in PACIFICARE HEALTH SYSTEMS, INC. v. BOOKAlthough Aetna has settled with healthcare providers, most insurers and managed-care organizations have refused to settle or to  admit wrongdoings, and managed-care bundling and downcoding partial claim denial continued as business usual without any sign of slowing down.

 

After U.S. Supreme Court ruling in PACIFICARE HEALTH SYSTEMS, INC. v. BOOK , health insurers and managed-care organizations survived last threat from physicians and medical associations nationwide.