SMRC Targets for 2022:  After Heavy Focus on Hospice, the SMRC Moves On to Home Health and Other Projects


The Supplemental Medical Review Contractor (“SMRC”) is a Centers for Medicare and Medicaid Services (“CMS”) contractor authorized to conduct nationwide medical reviews (Medicare Part A, Part B, and DME). As many in the hospice provider realm know, the SMRC focused heavily on auditing hospice claims through a Portfolio of audit projects consisting of three phases. The SMRC hospice Portfolio is now listed by the SMRC as a “Completed Project,” meaning that the SMRC’s audit work in the listed area has been completed.

SMRC Home Health Project.  Based on the SMRC’s website, the SMRC is working on 23 Current Projects. In the post-acute area, Home Health providers should be on the alert for SMRC audits focusing on medical record reviews of claims from January 1, 2020, through December 31, 2020.  The SMRC referenced home health payment reform that resulted in the Patient-Driving Groupings Model (“PDGM”) of Medicare reimbursement, and the concern that the new PDGM might cause a drop in therapy utilization or the manipulation of combinations of care to improperly maximize payments.  

SMRC Durable Medical Equipment (“DME”) Project.  Another post-acute topic involves an audit of DME claims in a non-covered skilled nursing facility (“SNF”) stays.  In 2018, the Office of Inspector General for the Department of Health and Human Services (“OIG”) issued a report that found that for a number of inappropriate DME claims, DME suppliers coded the place of service (“POS) as the beneficiary’s home, rather than coding the SNF.  Coding the POS as the home enabled claims to bypass the CMS edit that rejects separate payment claims for most DME provided at an SNF. 

SMRC Inpatient Rehabilitation Facility (IRF) Stays Project.  The SMRC will be conducting audits of IRF claims with a Length of Stay (“LOS”) longer than 8 days.  The basis for the IRF project included a 2018 OIG audit which found many IRF stays did not meet Medicare coverage and documentation requirements and were not reasonable and necessary.  In addition, the Comprehensive Error Rate Testing (“CERT”) program reflected an increase in the error rate for IRF stays over 50% from 2012 to 2016.   

SMRC Chronic Care Management (“CCM”) Project.  Payment for Medicare Facility CCM will also be under scrutiny by the SMRC. CCM is a physician-provided or physician-directed service.  Thus, although the outpatient facility is not required to have a corresponding claim billed by a physician, the SMRC notes that it is reasonable to expect a physician to submit a claim for the same services. The SMRC cited a 2019 report issued by OIG which identified CCM services billed by facilities without a corresponding physician claim which identified $1,162.562 in potential overpayments.  Based on this OIG report, the SMRC stated its intent to review outpatient CCM claims to determine if the claims were properly billed. 

SMRC Telehealth Audits.  During the COVID-19 pandemic, CMS expanded the use of audio-only telehealth codes to a range of providers and locations and changed the payment status of a number of CPT codes from non-covered to allowable services.  The SMRC has announced it will review audio-only telehealth claims from March 6, 2020, to June 1, 2021. The SMRC also lists a claim review of traditional telehealth claims submitted during the same time period, March 6, 2020, to June 1, 2021. 

The full list of SRMC Current Projects is found here.

Effectively responding to SMRC audits can be complex and burdensome.  Connect with Nexsen Pruet today for assistance in defending your SMRC audits. 

This is an article from a Series on Effectively Responding to Payor Audits & Program Integrity Investigations.  Topics in this Series include practical advice and legal developments for providers defending payor audits and investigations, plus articles concerning current audit and investigation targets and the various types of auditors reviewing claims and conducting investigations.  The Series covers topics of interest to all providers of health care services, including hospitals, hospices, home health agencies, skilled nursing facilities, DME suppliers, clinical laboratories, pharmacies, FQHCs, RHCs, ASCs, community mental health centers, physicians, therapists, and other health care facilities, entities, practitioners, and clinicians.

Prior articles in this series include:

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