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CMS Announces Implementation of Review Choice Demonstration for IRFs

CMS Announces Implementation of Review Choice Demonstration for IRFs

The Centers for Medicare & Medicaid Services (CMS) has begun implementing the Review Choice Demonstration (RCD) for Inpatient Rehabilitation Facilities (IRFs). The project began last month for IRF services in Alabama, and IRF providers that are involved can make their choice of either 100-percent pre-claim review or 100-percent post-payment review.

The demonstration project is proposed to last five years, beginning with four states – Alabama, Pennsylvania, Texas, and California – and expand to all IRFs located in any state covered by Medicare Administrative Contractor (MAC) jurisdictions JJ, JL, JH, and JE. So, if your MAC is Noridian, Novitas, or Palmetto, you would eventually be involved. CMS has indicated that a minimum 60-day notice period would apply to expansion into other states.

How does it work?
Initial Phase

As noted, each IRF would choose either 100-percent pre-claim review or 100-percent post-payment review, and would be locked in to this method until they meet a 90-percent threshold for affirmation. The review would cover six-month cycles. If the IRF reaches 90-percent affirmation, based on a minimum of 10 pre-claim requests or claims submitted for the six-month period, it would have an opportunity to opt out of future reviews, except for a 5-percent spot-check of claims. 

Process Flow

CMS has provided a process flow chart for IRFs to use in understanding the process. It can be located at Review Choice Demonstration for Inpatient Rehabilitation Facility (IRF) Services (cms.gov) and is included below:

Making the Choice

Based on previously published CMS documents, when an IRF elects pre-claim review for all claims, the IRF must submit a request prior to the submission of the final claim for payment. The IRF has an unlimited number of submissions of the request prior to the claim being submitted. At minimum, the request will include key demographic and provider information, along with:

  • Preadmission Screening Assessment; and
  • Individualized Overall Plan of Care.

Additional information may be included to support the claim. For a resubmission, the documents published note the need for the Post-Admission Physician Evaluation, which is no longer a required document for IRFs. 

Here, if the MAC determines that the coverage and documentation requirements are met, a provisional affirmation is sent to both the IRF and the beneficiary. When the IRF submits the claim, it is linked to the pre-claim review through a Unique Tracking Number (UTN) and the claim is paid. When the pre-claim decision is negative, the claim will not be paid.   The IRF may appeal the claim denial using the current appeals process.

If the IRF chooses post-payment review, the organization will follow its standard process for providing services and the claim will be submitted according to normal claim review. Here, the MAC will conduct a complex medical review on all of the claims submitted during the six-month review period. The MAC will send an additional documentation request after receipt of the claim, or the IRF may send the documentation at the time the claim is submitted. Here, the IRF may also appeal any denied claim using the current appeals process.

IRFs that do not actively select one of the initial two review choices will be automatically assigned to participate in post-payment review.

Common Questions

CMS has provided a FAQ sheet included in the reference section of this article. However, the following are key issues:

Medicare Advantage Plans

  • The RCD only applies to Medicare beneficiaries covered under Fee-for-Service Medicare.

Other Claims Exempt from the RCD

The following claims are also exempt:

  • IRF claims for Veteran Affairs, Indian Health Services, Part A/B rebilling, demand bills submitted with condition code 20, no-pay bills submitted with condition code 21, canceled claims, and all Part A and Part B demonstrations.

Will these claims be subject to additional review?

CMS has provided the following statement related to additional review: “Absent evidence of potential fraud or gaming, the claims that have a provisional affirmation PCR decision or were approved under medical review will not be subject to additional review. However, CMS contractors, including Unified Program Integrity Contactors (UPICs) may conduct targeted prepayment and post-payment reviews to ensure that claims are accompanied by documentation not required or available during the PCR process. In addition, the CMS Comprehensive Error Rate Testing (CERT) program reviews a stratified, random sample of claims annually to identify and measure improper payments. It is possible for an IRF claim that is subject to the demonstration to fall within the sample. In this situation, the subject claim wound not be excluded from the CERT audit.”

Furthermore, CMS has noted that providers will not be under Targeted Probe-and-Educate (TPE) review and the RCD at the same time. 

We still do not have all the information related to this demonstration, and processes could change over time. 

What can IRFs do to improve their success rate?

CMS notes that the “pre-admission screening, which serves as the basis for the initial determination of whether or not the patient meets the requirements for an IRF admission to be considered reasonable and necessary, should be included, at a minimum. It must include a detailed and comprehensive review of the beneficiary’s condition and medical history. Additional documentation may include but is not limited to the History & Physical, therapy evaluations, skilled notes, interdisciplinary team note(s), admission orders., etc.” Palmetto gives more specific details requiring the preadmission assessment, documentation that therapy services have been initiated, and documentation that rehabilitation physician visits have been initiated.

Based on these documentation requirements, we strongly recommend that each IRF:

  • Perform an in-depth review of their preadmission assessment documentation. This documentation serves as the basis for justifying the admission and needs to clearly demonstrate the need for the IRF stay, the patient’s ability to participate, and rationale for admission.
  • Address the rehabilitation physician history and physical to ensure that this documentation includes justification for why the patient requires an IRF stay at the time of admission.
  • Address therapy evaluations to ensure that they define functional deficits and level of skilled therapy required at the time of admission, along with the patient’s ability to participate in and benefit from an intensive therapy program.
Other Resources

Palmetto has published a series of articles and instructions on their website. Providers may find this information at: Palmetto GBA IRF Review Choice Demonstration Information.

CMS Open Door Presentation: June 27, 2023

FAQS Related to the Review Choice Demonstration (RCD)

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Angela Phillips, PT

Angela M. Phillips, PT, is President & Chief Executive Officer of Images & Associates. A graduate of the University of Pennsylvania, School of Allied Health Professions, she has almost 45 years of experience as a consultant, healthcare executive, hospital administrator, educator, and clinician. Ms. Phillips is one of the nation’s leading consultants assisting Inpatient Rehabilitation Facilities in operating effectively under the Medicare Prospective Payment System (PPS) and in addressing key issues related to compliance.

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