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09/06/2019 Audit HEALTHCARE HORIZONS CONSULTING GROUP, INC. September 6, 2019 HEALTHCARE CLAIMS AUDIT REPORT ( FINAL) Monroe County Florida - Florida Blue AUDIT PERIOD: JANUARY 2017 - DECEMBER 2018 Healthcare Horizons Consulting Group, Inc. 2220 Sutherland Avenue, Knoxville, TN 37919 (800) 646-9987 or (865) 684-2917 HHAdmin@healthcarehorizons.com HEALTHCAREHORIZONS.COM HEALTHCARE HORIZONS CONSULTING GROUP, INC. Table of Contents ExecutiveSummary............................................................................................................ 1 ProcessOverview............................................................................................................... 3 SiteVisit Selection.............................................................................................................. 4 RecoverableFindings ......................................................................................................... 5 InformationalFindings ....................................................................................................... 8 Observations from Operational Questionnaire................................................................ 10 Conclusion ....................................................................................................................... 11 Definitions - Areas of Testing ........................................................................................... 12 Appendix A — Site Visit Detail ........................................................................................... 17 Appendix B — Out-of-Sample Claims ................................................................................ 20 Appendix C — Operational Questionnaire......................................................................... 21 Appendix D — Florida Blue Performance Guarantee Scorecard 2017-2108 ...................... 31 Appendix E — Florida Blue BOCC Corrective Action Plan................................................... 32 Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page i HEALTHCARE HORIZONS CONSULTING GROUP, INC. Executive Summary Monroe County Clerk of the Court and Comptroller (Monroe County) engaged Healthcare Horizons to perform an audit of claims processed by Florida Blue for paid dates of January 2017 through December 2018. Healthcare Horizons received $26,652,214 in paid claims data from Florida Blue and performed a full electronic review of claims processing. The purpose of the audit was to identify claim errors resulting in incorrect payments and to assess underlying conditions contributing to any errors identified. Healthcare Horizons delivered 150 targeted sample claims to Florida Blue as potential errors (based on mining of the data) or higher-dollar items in need of review. A site visit was conducted the week of April 8, 2019 to review the targeted claims selection with all items resolved in the weeks that followed. Healthcare Horizons identified an agreed recovery amount of$76,140.74 from the sample claims, representing a minimal dollar percentage of errors given the overall size of the dataset. The majority of sample findings are related to coordination of benefits with other primary insurance. The detailed results of all sample claims are presented in Appendix A. Based on the sample findings, Healthcare Horizons delivered out-of-sample claims involving coordination of benefits and Florida Blue agreed with a total overpayment amount of$11,713.11 (detailed in Appendix B). Our findings for the audit are summarized as follows. Site Visit Out-of-Sample Total Audit Recovery Issue Overpayment Overpayment 1 Amount Amount Amount Retiree Coordination of Benefits $55,023.28 $5,567.71 $60,590.99 Other Insurance $3,636.04 $6,145.40 $9,781.44 Duplicates $8,130.62 $0.00 $8,130.62 Pre-Operative Testing $6,887.19 $0.00 $6,887.19 Eligibility $1,302.57 $0.00 $1,302.57 ....................................... ........ Pre-Admission Testing $473.25 $0.00 $473.25 Outpatient with Admission $410.08 $0.00 $410.08 Multiple Procedure Reductions $277.71 $0.00 $277.71 Totallsl $76,140.74 $11,713.11 $87,853.85 1Florida Blue has performed adjustments to recoup$19,412.70 of the total audit recovery amount. For the remaining balance of$68,441.15, Healthcare Horizons recommends that Monroe County request a direct credit of$65,657.68 to settle overpayments attributed to Florida Blue error(all overpayments except audit item 82 for$2,783.47). Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 1 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Healthcare Horizons also submitted an operational questionnaire to Florida Blue and the responses are attached as Appendix C. We have included our observations based on a review of the completed questionnaire and offered highlights and recommendations for best practices by Monroe County. In addition,the Florida Blue performance guarantee scorecard for 2017-2018 is included as Appendix D. Finally,the Florida Blue corrective action plan is included as Appendix E. Where appropriate, Healthcare Horizons has inserted final comments by issue to address the Florida Blue response. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 2 HEALTHCARE Process Overview Healthcare Horizons systematically reviews 100%of claims payments by the administrator on behalf of our clients via our proprietary electronic claims edits. A series of standard algorithms are utilized to identify potential areas of claims overpayments in areas such as eligibility, pricing, duplicates and medical edits. In addition, customized queries are created specific to each client based on variable factors such as benefits design. Based on the results of our electronic analysis, Healthcare Horizons targets areas with significant overpayment potential based on the dollar amount and our experience with the categories in question. Many areas are resolved by Healthcare Horizons without inclusion in the claims sample due to low findings from the electronic analysis or our determination that the claims flagged are exceptions rather than errors. For the areas that warrant additional research, a sample of claims is selected for review during the site visit with the administrator. Within each category, Healthcare Horizons strives to select a sample that is representative of all claims identified for the particular issue and covers significant potential errors. The goal of the site visit is to work with the administrator to verify the presence of an error on each claim and to solidify the logic used to identify the claims for full reports. Healthcare Horizons recommends the delivery of additional claims beyond the site-visit sample for review and recovery by the administrator if warranted by the site-visit findings. For example, if Healthcare Horizons and the administrator agreed that nineteen of twenty eligibility claims were recoverable overpayments, Healthcare Horizons would deliver a full report from the entire dataset meeting the same criteria. Once an agreed listing of overpaid claims has been identified and placed into recovery by the administrator, Healthcare Horizons monitors the collections process to a point of completion that is satisfactory to both Healthcare Horizons and our client. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 3 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Site Visit Selection The following chart details the composition of the site-visit claims selection as well as the errors identified during the site visit. Issue Audit Items Overpayment Items Amount Contract Review 25 0 $0.00 J-Code Pricing 6 0 $0.00 Host Pricing 1 0 $0.00 Duplicates - Claim Level 10 4 $5,007.35 ................... Duplicates - Line Level 14 7 $3,123.27 Medicare Part A Deductible 2 0 $0.00 Eligibility 11 10 $1,302.57 Eligibility Not on File 8 0 $0.00 Other Insurance 11 2 $3,636.04 Retiree Coordination of Benefits 4 4 $55,023.28 ESRD 2 0 $0.00 Secondary Payments 10 0 $0.00 Multiple Procedure Reductions 6 1 $277.71 Outpatient with Admission 4 1 $410.08 Pre-Admission Testing 2 1 $473.25 Pre-Operative Testing 20 11 $6,887.19 Timely Filing 4 0 $0.00 Benefits - ER Copayment 5 0 $0.00 Benefits - Inpatient Copayment 5 0 $0.00 Totallsi 1501 41 $76,140.74 Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 4 HEALTHCARE Recoverable Findings Florida Blue has effective system edits in place to prevent duplicate payment errors. Healthcare Horizons performs a number of queries to identify potential duplicate payments, and our initial analysis yielded a small volume of potential duplicates that were all submitted in the sample selection. Including both claim-level and line-level submissions, Florida Blue agreed with 11 duplicate payment errors totaling$8,130.62 (audit items 34, 38,40, 42, 44, 46,47, 50, 52, 54, 55) with a root cause of manual processor error. Healthcare Horizons' Final Comment: Based on the Florida Blue corrective action plan, overpayments totaling$4,139.59 have been adjusted for recoupment. The remaining$3,991.03 (audit items 40, 42, and 47) cannot be adjusted due to timely filing limitations. The County may consider requesting a direct credit to settle these claims. Healthcare Horizons identified recoverable claims impacted by retroactive eligibility terminations. All claims in the dataset were tested for eligibility coverage based on the historical eligibility file provided by Florida Blue. We identified 10 claims with a service date after termination and one claim during a gap in coverage. All 10 were agreed as recoverable by Florida Blue with a total overpayment of$1,392 (audit items 59-69). Each claim involved a retroactive eligibility termination; however, Florida Blue is researching root cause to determine why the claims did not appear on its internal retroactive termination report. In addition, Healthcare Horizons identified a single claim (audit item 75 for$4,242) paid for a member that was not present on the historical eligibility file provided by Florida Blue (noted as Not on File). Florida Blue is also researching this retroactive termination to determine why the claim was not identified via internal reporting. Healthcare Horizons' Final Comment: Per the Florida Blue corrective action plan, appropriate efforts have been initiated to adjust claims impacted by retroactive eligibility terminations. In addition, updated feedback from Florida Blue shows that audit items 60 and 75 are correct payments based on further review (members were eligible based on multiple enrollment updates). As such,we have removed the dollar findings from all applicable charts. The remaining$1,302.57 has been adjusted for recovery by Florida Blue. Retroactive notification of other primary insurance and manual processor error resulted in the identification of recoverable claims due to missed coordination of benefits. Healthcare Horizons utilizes the claims data to identify members with other primary insurance based on a coordination of benefits (COB) savings amount present on certain claims. We then test claims for the same members with no COB savings to determine if coordination with the primary carrier was missed. For audit items 82 (retro-notification) and 84 (manual error), Florida Blue agreed with missed coordination of benefits involving a total paid amount of$3,636.04. Based on the other insurance primary dates noted, Healthcare Horizons delivered 27 additional out-of-sample claims for review and Florida Blue confirmed an additional overpayment amount of$6,145.40. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 5 HEALTHCARE Healthcare Horizons' Final Comment: The Florida Blue corrective action plan confirms retroactive notification of other insurance as the root cause for audit item 82 and examiner error for audit item 84 (feedback and coaching have occurred). The response also confirms that all 27 out-of-sample claims failed to coordinate in error with Medicare primary coverage (research efforts are underway to determine the cause). In terms of recovery, Florida Blue indicates that all claims ($9,781.44) are ineligible for adjustment due to timely filing rules. As such,the County may consider requesting a direct credit of $6,997.97 to settle the overpayments due to Florida Blue error(excludes audit item 82 for$2,783.47). Healthcare Horizons identified missed coordination of benefit opportunities with Medicare primary coverage for retirees age 65 and higher. In reviewing the full paid claims dataset, four retirees age 65 and higher were identified with material payments with no coordination with Medicare primary coverage (audit items 89-92).The results of each audit item are listed below: • Audit item 89—manual processor error—$4,139.18 • Audit item 90—Medicare denied as duplicate; Florida Blue allowed in error—$6,200.02 • Audit Item 91—manual processor error—$5,723.58 • Audit item 92—retro-notification of Medicare primary coverage—$38,960.50 Based on the site-visit results, Healthcare Horizons delivered 14 additional out-of-sample claims and Florida Blue confirmed an additional overpayment amount of$5,567.71. Healthcare Horizons' Final Comment: Per the corrective action plan provided, Florida Blue confirms examiner error for audit items 89, 90, and 91. The overpayment identified on audit item 92 was due to an error in the member's order of liability file. In reviewing the additional out-of-sample claims supplied by Healthcare Horizons, Florida Blue agrees to missed coordination on all claims ($5,567.71) and research efforts are underway to determine root cause for each overpayment. In terms of recovery, audit item 90 was adjusted for recoupment in the amount of$6,200.02. The County may consider requesting a direct credit for the remaining balance of$54,390.97 to settle the issue given the Florida Blue errors identified. Healthcare Horizons identified a single overpayment due to a missed multiple procedure reduction caused by fragmented billing. When multiple surgical procedures are performed in the same operative session, it is industry standard to allow the primary procedure at the full fee schedule rate and secondary procedures at a reduced rate (usually 50%of the full fee). These reductions are taken since the primary procedure payment accounts for patient preparation and other services. Healthcare Horizons often identifies errors when payments are processed on different claims for the same surgical case. Only a single error was identified in the dataset for this issue resulting in an overpayment of$277.71 (audit item 106). Note that Florida Blue considers this item a manual processor error. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 6 HEALTHCARE Healthcare Horizons' Final Comment: Florida Blue confirms an examiner error as root cause and indicates that appropriate feedback and coaching has been provided. As the overpayment of$277.71 is not recoverable due to timely filing limitations, a direct credit may be indicated. Provider billing errors resulted in overpayments for outpatient services on the day of admission, pre-admission testing, and pre-operative testing. It is common for hospital contracts to state that any outpatient services performed on the day of an inpatient admission are not separately reimbursed. As such, only a single claim should be submitted for the episode of care. Separate billing of any outpatient services may result in an overpayment as the inpatient reimbursement (if based on per diem or case rate) covers all care for the day. Florida Blue agreed to an overpayment of$410.08 on audit item 111 for this issue. In addition, if pre-admission or pre-surgical testing is incorrectly billed separately from the subsequent planned inpatient stay or outpatient surgery, a similar opportunity for overpayment exists. Healthcare Horizons found audit item 115 paid in error for pre-admission testing ($473.25) and audit items 117, 119, 121, 123, 125, 127, 128, 130, 132, 134, and 135 paid in error for pre-surgical testing ($6,887.19). Florida Blue may choose to utilize these claims as examples for additional provider training. Healthcare Horizons' Final Comment: Florida Blue states that the overpayments are due to provider billing errors as the services should be combined into a single bill. In addition, Florida Blue has initiated a project to prevent separate payment of pre-admission or pre-operative testing moving forward. In the interim, a work-around report will be performed by the Payment Integrity Office to identify and recover overpayments for this issue. Finally, all overpayments ($7,770.52) have been adjusted for recovery to the County. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 7 HEALTHCARE Informational Findings Healthcare Horizons did not identify any pricing errors based on a review of facility contracts. Florida Blue provided the complete facility contracts for 25 claims in order to test pricing accuracy for highly utilized hospitals in the Monroe County dataset. All claims were found to have priced correctly per the contracts provided. Based on the results of our testing, Florida Blue is correctly pricing claims according to its facility contracts. Excessive billed charge amounts were identified for a specialty drug reimbursed via percent-of-charges. Audit items 26-31 were submitted in order to test pricing and highlight the potentially excessive billed charge amounts for review by Florida Blue. The drug in question was found to be priced correctly according to a percent-of- charges rate as observed in the facility contract. However, the facility is currently billing$271 per unit which is excessive when compared to other benchmarks. According to the industry-standard database utilized by Healthcare Horizons, the national 951" percentile of billed charges is$100 per unit. When presented with the claims, Florida Blue opted to investigate the case and explore cost-savings solution for Monroe County. Specifically, Florida Blue reached out to the facility in an effort to obtain a case-specific letter of agreement and the request was denied. Case management also explored options to obtain the drug from another source with administration in another setting; however, the physicians involved were not in favor of this alternative. As the cost of the drug for the 2017-2018 audit period is in excess of$1.8 million,we recommend that Monroe County and Florida Blue continue to pursue more favorable payment rates from the hospital that is administering this drug. Plan intent clarification is recommended for Medicare Part B estimation. It is common for employer plans to require Medicare Part B estimation by its administrator. In other words, if a participant is eligible for Medicare Part B benefits but does not enroll, the plan pays as if the participant had enrolled in Medicare Part B. The end result is a payment equal to 20%of the Medicare fee schedule with the member responsible for any balance billing. When Healthcare Horizons inquired about this policy, Florida Blue indicated that Medicare Part B estimation only currently applies for retirees over 65. If the member is eligible for Medicare primary coverage for any other reason (such as end stage renal disease or ESRD),then the plan does not estimate Medicare Part B benefits. This current administration does not seem to agree with the following plan document language: When you become covered under Medicare and continue to be eligible and covered under this Benefit Booklet, coverage under this Benefit Booklet will be primary and the Medicare benefits will be secondary, but only to the extent required by law. In all other instances, coverage under this Benefit Booklet will be secondary to any Medicare benefits. If you become eligible for Medicare due to ESRD, coverage will be provided, as described in this section, on a primary basis for 30 months. Florida Blue and Monroe County should work to ensure that Medicare Part B estimation administration matches plan intent. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 8 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Comprehensive benefits testing did not identify any administration errors by Florida Blue. Healthcare Horizons created 70 customized queries to test benefit maximums, exclusions, and patient responsibility and found the benefits to be set up correctly by Florida Blue. Healthcare Horizons did sample two categories for potential missed copayment (inpatient and ER); however, all claims were found to be processed correctly as either a secondary payment or an instance where maximum out-of-pocket had been met. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 9 HEALTHCARE Observations from Operational Questionnaire Healthcare Horizons appreciates the detailed answers provided by Florida Blue in response to our Operational (Cost Containment) Questionnaire (Appendix C). The feedback provided by Florida Blue is indicative of robust cost-containment measures in place in the following areas: • Out-of-Network— Florida Blue has strong protections in place to prevent exorbitant out-of-network payments via its Non-Participating Provider Payment Rates Policy.This position is supported by the absence of any out-of-network payments at abusive billed charges identified in the dataset. • Retroactive Eligibility Terminations—Florida Blue systematically identifies and adjusts claims impacted by retroactive eligibility terminations. • Medical Edits—Florida Blue utilizes ClaimsXten to identify inappropriate procedure code combinations (mutually exclusive, unbundling, etc.). • Case Management—The Florida Blue standard operating procedure for case management is robust and well-defined. • Performance Guarantees—Florida Blue exceeded all performance guarantees for 2017-2018 (see Appendix D). In terms of recommendations for best practices, Healthcare Horizons offers the following: Monroe County should continue to monitor subrogation recoveries. Per reporting obtained from Florida Blue, there are 27 cases in process with claims paid at$416,779.29. In terms of recent activity, Healthcare Horizons notes the following: Closed Cases Closed Cases Year Recovery Amount (No Recovery) with Recovery 2017 26 13 $31,249.13 2018 24 6 $38,825.25 Totals 50 19 $70,074.38 Monroe County should monitor outstanding refund requests with no cash collection. Based on a report obtained from Florida Blue, current accounts receivable totals$57,675.67. The County should request periodic reporting from Florida Blue to monitor these outstanding collections and follow-up on any significant amounts. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 10 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Conclusion Healthcare Horizons appreciates the opportunity to perform this claims audit on behalf of Monroe County. The overall results represent excellent performance by Florida Blue in the administration of healthcare claims. We would also like to recognize the cooperation exhibited by the entire Florida Blue team during this process. We recommend the following actions in order to maximize the effectiveness of the audit: • Florida Blue should engage in discussions with Monroe County to clarify plan intent for Medicare Part B estimation. • Florida Blue and Monroe County should continue to pursue cost reduction options for the high-dollar specialty drug identified. • Monroe County should consider requesting a direct credit of 65,657.68 to settle all uncollectible overpayments attributed to Florida Blue error. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 11 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Definitions - Areas of Testing Duplicate Claims Healthcare Horizons runs a series of duplicate claim edits across the claims dataset to identify claims that have been billed and paid more than once. Healthcare Horizons identifies duplicate claims at both the claim level and individual procedure level. The duplicate claim queries vary with matches and mismatches on fields such as patient, provider, service date, billed charge, and procedure code. While most clients would expect duplicate claims to be rare, they are quite common in healthcare claims payments and usually result in recoveries on every project conducted by Healthcare Horizons. Eligibility In addition to claims data, Healthcare Horizons requests a full eligibility file from the administrator to validate coverage on the service date. Employer groups often submit retroactive terminations to the administrator, resulting in an opportunity for overpayments unless the administrator has a process in place to identify and recover these claims. Every administrator should have a process for identifying and recovering claims affected by a retroactive termination as they are common in the claims industry. In addition to claims paid after the termination date, Healthcare Horizons identifies claims paid during a gap in coverage and claims paid without an eligibility record on file. Contract Audit Healthcare Horizons normally requests a review of the signed provider contracts for the top 30 utilized hospitals for each group. While on-site at the administrator, Healthcare Horizons uses the claims data to test pricing and other contractual terms present in the contract for all claims paid to that provider in the claims dataset. Other terms in the contract may include readmissions, outpatient services on the day of admission, pre-admission testing, timely filing, and transfers. Some administrators do not allow this type of comprehensive audit of provider contracts in which Healthcare Horizons tests all claims according to the terms present in the contracts. If this is not made available, Healthcare Horizons selects site-visit sample claims to test pricing and the following items on a more limited basis. ■ Readmissions - If provider contracts have Diagnosis-Related Group (DRG) case rate reimbursement, readmissions to treat the same illness may not be allowed if the patient is readmitted within a certain number of days. This prevents facilities from being compensated a greater amount for an inappropriate discharge. ■ Outpatient Services on Day of Admission - If a patient receives outpatient services such as an emergency room visit, and is later admitted on the same day,these charges should be combined with the inpatient claim Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 12 HEALTHCARE HORIZONS CONSULTING GROUP, INC. according to most provider contracts. If the provider is reimbursed based on per diems or DRG case rate, no additional payment is made for the outpatient services. ■ Pre-admission Testing- If a patient undergoes tests related to a scheduled admission within 24 to 72 hours, these services may be included with the inpatient claim and not paid in addition to the inpatient stay for per diem or DRG case rate reimbursement. Examples of these tests include lab work and a baseline chest x-ray. ■ Timely Filing- Provider contracts often state that claims must be submitted to the administrator within a certain time period (such as one year) to be eligible for payment. Otherwise the claim should be denied and the patient is held harmless. ■ Transfers - Provider contracts based on DRG case rate inpatient reimbursement often contain special pricing if the patient is transferred to another acute care hospital for treatment. Since the patient was transferred, the initial hospital is not due the full case rate amount to treat the illness. Transfer payments are often based on a specific per diem rate in the contract. Assistant Surgeon In some circumstances, a procedure may require the services of an assistant in addition to the primary surgeon. Healthcare Horizons tests two common areas of overpayments for assistant surgeons: pricing and coding. Assistant surgeons usually receive 20-25%of the normal fee schedule rate for the codes used with assistant modifiers. Healthcare Horizons utilizes the claims data to identify the payment to the primary surgeon and then isolates assistant surgeon claims paid greater than 20-25% of this rate. In our experience,this analysis yields a high rate of assistant surgeon lines that are overpaid. In addition,The Center for Medicare Services produces a publicly available listing of procedure codes for which it does not allow a payment for assistant surgery. These are services that, by their nature, do not lend themselves to requiring an assistant. Healthcare Horizons identifies assistant surgeon claims for these procedures as possible overpayments. Although this Medicare guideline is not a requirement that must be followed by commercial insurance carriers, most administrators should have some similar list of codes not payable for assistants. Multiple Procedure Reductions When multiple services are performed in the same session, secondary procedures are priced at a reduced percentage (usually 50%) of the normal contract rate to account for economies and efficiency gained by not having to duplicate preparation of the patient for each procedure. Healthcare Horizons flags claims that may have missed this standard discount by reviewing the secondary procedure allowance in relation to the primary procedure allowance for the session of care. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 13 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Benefits Healthcare Horizons creates customized queries to model the benefits present in the summary plan documents (SPDs) provided by the employer group. Likely areas of testing for benefits are application of copayments and coinsurance, annual dollar or visit maximums, non-covered benefits, coordination of benefit rules, and other specific items flagged by our auditors as potential errors. A Healthcare Horizons auditor reviews the SPDs in full for each claims audit and selects the benefit areas where testing is possible. Some benefits do not lend themselves to systematic testing in the data and can only be reviewed on selected sample claims. Pricing Healthcare Horizons takes steps to verify accurate pricing of certain claims in the dataset such as high dollar, no discount, and those with variability in pricing. These steps are described further below. Healthcare Horizons selects the highest paid claims in the dataset to ensure correct pricing by the administrator. Often these claims are more complex, which raises the possibility of error. Claims priced at billed charges with no discount are targeted for pricing verification. Given the broad networks of the larger administrators, as well as the availability of national rental networks, the majority of claims should receive some type of discount. Healthcare Horizons verifies that pricing was not missed in error on higher paid claims. Healthcare Horizons profiles top facilities and establishes payment patterns and trends. Claims that fall outside of the normal patterns will be questioned for payment errors. This area is especially important if a contract audit is not available as part of the audit process. Since Healthcare Horizons has found that pricing of claims is one of the largest categories of errors at many administrators,we take aggressive steps to identify as many potential errors as possible for detailed review. Other Insurance The presence of other primary insurance usually reduces the payment due by the employer group if they are secondary. In some cases, a secondary policy will pay as primary, such as when primary benefits are exhausted or the primary policy does not cover a particular service. Healthcare Horizons utilizes the claims data to identify claims paid as primary that may have other insurance based on the following categories: • Other Claims Paid as Secondary— Healthcare Horizons utilizes the claims data to create a date range for each patient where claims have been paid as secondary based on the presence of a coordination of benefits (COB) savings amount. Any claims paid within this date range without a COB amount may be questioned for the presence of other primary coverage. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 14 HEALTHCARE HORIZONS CONSULTING GROUP, INC. • ESRD—After a 30 month coordination period, Medicare automatically becomes the primary insurer for the patient. Healthcare Horizons identifies patients with an extended period of treatment for ESRD to ensure the administrator is correctly tracking the Medicare primary effective date. • COBRA—While exceptions do apply, Medicare should be the primary payer for members on COBRA coverage that are age-eligible for Medicare. • Retirees—Medicare should be primary for members, age 65 and higher, on a retiree plan. Healthcare Horizons also scrutinizes claims that are paid as secondary with a paid amount higher than that of the primary carrier. Normally, the secondary payment is lower than the primary plan payment as it likely only covers remaining member responsibility after the primary payment. Healthcare Horizons analyzes provider billing patterns to detect possible instances of fraud. While these cases may prove difficult to recover, it is important to identify these providers and stop future payments. High Units Healthcare Horizons queries the claims data for unit counts that are abnormally high for the procedure code billed. An error in units may cause the claim to default to billed charges as the fee schedule is multiplied by an incorrect unit count. Medical Edits Healthcare Horizons applies medical edits to the claims data to identify mutually exclusive procedures and cases of procedure unbundling. Mutually exclusive edits identify procedure combinations that cannot be reasonably performed on the same patient on the same day. Unbundling occurs when a provider bills multiple component codes versus a single comprehensive code, often resulting in higher reimbursement. Payers have much discretion over which medical edits to apply as there is not a commonly accepted group of these throughout the industry; therefore, Healthcare Horizons is generally looking for a reasonable application of a set of edits and questions selected claims that seem to be clear errors. Overlapping Inpatient Healthcare Horizons identifies cases where patients have claims reporting that they are inpatient at different facilities for the same service date. These are often the result of provider billing errors or manual data entry mistakes. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 15 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Subrogation Healthcare Horizons queries the claims data for possible subrogation opportunities where third party liability (TPL) may exist. A common example is medical services related to an auto accident where the auto insurer is liable for a portion of the medical claims. These claims are identified via accident-related diagnosis codes. Hospital Mistakes Many payers across the country have adopted policies to investigate and subsequently deny payment for hospital mistakes and avoidable conditions, such as objects left in patient during surgery,fractures incurred in the hospital, blood incompatibility, and certain types of infections. Healthcare Horizons examines the claims data for these types of hospital errors and expects recovery opportunities for these errors as more administrators adopt such policies. Cosmetic Surgery Healthcare Horizons maintains a listing of procedure codes that may be considered as cosmetic, but judgments on these claims are highly subjective. Healthcare Horizons is usually looking at the total paid for these types of codes to make sure it is not excessive. If any of these claims are selected for the sample, we request that the administrator provide evidence that the claim was considered for medical review and that reasonable review took place. Medical necessity issues such as cosmetic surgery are not areas that result in significant recovery, but can be issues that our clients want to address proactively for future cost savings. Reinsurance If the employer group has stop loss or reinsurance coverage, Healthcare Horizons utilizes the claims data to identify members that should have resulted in a credit due back to the group. Healthcare Horizons verifies with the administrator that the credits have been issued to the group. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 16 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Appendix A - Site Visit Detail Audit Issue Overpayment Amt Comment Item 1 Contract Review $0.00 Pricing correct-DRG plus stop loss 2 Contract Review $0.00 Pricing correct-DRG plus stop loss 3 Contract Review $0.00 Pricing correct-outpatient surgery case rate(lesser of) 4 Contract Review $0.00 Pricing correct-DRG case rate(no readmission language) 5 Contract Review $0.00 Pricing correct-DRG case rate(no readmission language) 6 Contract Review $0.00 Pricing correct-DRG case rate 7 Contract Review $0.00 Pricing correct-DRG case rate(lesser of) 8 Contract Review $0.00 Pricing correct-percent of charges 9 Contract Review $0.00 Pricing correct-percent of charges 10 Contract Review $0.00 Pricing correct-percent of charges 11 Contract Review $0.00 Pricing correct-stop loss percent of charges 12 Contract Review $0.00 Pricing correct-percent of charges 13 Contract Review $0.00 Pricing correct-per diem plus stop loss percent of charges 14 Contract Review $0.00 Pricing correct-percent of charges 15 Contract Review $0.00 Pricing correct-stop loss percent of charges 16 Contract Review $0.00 Pricing correct-percent of charges 17 Contract Review $0.00 Pricing correct-stop loss percent of charges 18 Contract Review $0.00 Pricing correct-percent of charges 19 Contract Review $0.00 Pricing correct-stop loss percent of charges 20 Contract Review $0.00 Pricing correct-DRG case rate 21 Contract Review $0.00 Pricing correct-DRG case rate(lesser of) 22 Contract Review $0.00 Pricing correct-DRG case rate(lesser of) 23 Contract Review $0.00 Pricing correct-DRG plus stop loss(lesser of) 24 Contract Review $0.00 Pricing correct-stop loss percent of charges 25 Contract Review $0.00 Pricing correct-percent of charges Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 26 J-Code Pricing $0.00 reimbursement by BCBSFL Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 27 J-Code Pricing $0.00 reimbursement by BCBSFL Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 28 J-Code Pricing $0.00 reimbursement by BCBSFL Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 29 J-Code Pricing $0.00 reimbursement by BCBSFL Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 30 J-Code Pricing $0.00 reimbursement by BCBSFL Pricing and units correct-will cite observation for excessive billed charge amounts by provider with percent of charges 31 J-Code Pricing $0.00 reimbursement by BCBSFL 32 Host Pricing $0.00 Pricing correct-DRG case rate 33 Duplicates-Claim Level $0.00 Correct claim for 33/34 combo 34 Duplicates-Claim Level $595.32 Manual processor error 35 Duplicates-Claim Level $0.00 Different providers 36 Duplicates-Claim Level $0.00 Different providers 37 Duplicates-Claim Level $0.00 Correct claim for 37/38 combo 38 Duplicates-Claim Level $471.14 Manual processor error-too old to recover per BCBSFL 39 Duplicates-Claim Level $0.00 Correct claim for 39/40 combo 40 Duplicates-Claim Level $2,627.26 Manual processor error 41 Duplicates-Claim Level $0.00 Correct claim for 41/42 combo 42 Duplicates-Claim Level $1,313.631 Manual processor error Monroe County-Florida Blue Claims Audit Report September 6,2019 I Page 17 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Audit Issue Recovery Amt Comment Item 43 Duplicates-Line Level $0.00 Correct claim for 43/44 combo 44 Duplicates-Line Level $92.38 Manual processor error 45 Duplicates-Line Level $0.00 Correct claim for 45/46 combo 46 Duplicates-Line Level $56.54 Manual processor error 47 1 Duplicates-Line Level $50.14 Manual processor error-too old to recover per BCBSFL 48 Duplicates-Line Level $0.00 Correct claim for 47/48 combo 49 Duplicates-Line Level $0.00 Correct claim for 49/50 combo 50 Duplicates-Line Level $24.40 Manual processor error 51 Duplicates-Line Level $0.00 Correct claim for 51/52 combo 52 Duplicates-Line Level $49.39 Manual processor error 53 Duplicates-Line Level $0.00 Correct claim for 53/54 combo 54 Duplicates-Line Level $2,764.62 Manual processor error 55 Duplicates-Line Level $85.80 Manual processor error 56 Duplicates-Line Level $0.00 Correct claim for 55/56 combo 57 Medicare Part A Deductible $0.00 Part A deductible-correct 58 Medicare Part A Deductible $0.00 Coinsurance not Part A deductible-correct Retro-term-BCBSFL investigating root cause as claim did not 59 Eligibility $26.53 appear on retro-term reporting 60 Eligibility $0.00 Member eligible Retro-term-BCBSFL investigating root cause as claim did not 61 Eligibility $20.93 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 62 Eligibility $264.49 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 63 Eligibility $115.72 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 64 Eligibility $159.50 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 65 Eligibility $23.00 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 66 Eligibility $59.40 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 67 Eligibility $451.76 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 68 Eligibility $34.79 appear on retro-term reporting Retro-term-BCBSFL investigating root cause as claim did not 69 Eligibility $146.45 appear on retro-term reporting 70 Eligibility Not on File $0.00 Member eligible 71 Eligibility Not on File $0.00 Newborn assessment services covered 72 Eligibility Not on File $0.00 Member eligible 73 Eligibility Not on File $0.00 Newborn assessment services covered 74 Eligibility Not on File $0.00 Newborn assessment services covered 75 Eligibility Not on File $0.00 Member eligible 76 Eligibility Not on File $0.00 Newborn assessment services covered 77 Eligibility Not on File $0.00 Newborn assessment services covered 78 Other Insurance $0.00 Other insurance termed 1/31/2017(DOS after) 79 Other Insurance $0.00 Medicare primary 2/1/18(DOS prior) 80 Other Insurance $0.00 No other insurance 81 Other Insurance $0.00 Medicare primary 11/1/2017(DOS prior) Other insurance primary 10/1/17-12/31/17.Notification received 82 Other Insurance $2,783.47 9/24/18.Too old to recover per BCBSFL. 83 Other Insurance $0.00 No other insurance Manual processor error-too old to recover per BCBSFL-Medicare 84 Other Insurance $852.57 primary 11/1/2011 85 Other Insurance $0.00 Medicare secondary 86 Other Insurance $0.00 No other insurance 87 Other Insurance $0.00 Medicare secondary 88 Other Insurance $0.00 Medicare secondary 89 Retiree Coordination of Benefits $4,139.18 Manual processor error-too old to recover per BCBSFL Medicare denied due to duplicate-BCBSFL should deny too- 90 Retiree Coordination of Benefits $6,200.02 manual error 91 Retiree Coordination of Benefits $5,723.58 Manual processor error-too old to recover per BCBSFL 92 Retiree Coordination of Benefits $38,960.50 Retro-notification of Medicare primary 9/1/15 Monroe County-Florida Blue Claims Audit Report September 6,2019 I Page 18 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Audit Issue Recovery Amt Comment Item 93 ESRD $0.00 Medicare primary 4/1/19 94 ESRD $0.00 No record of Medicare 95 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 96 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 97 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 98 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 99 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 100 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 101 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 102 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 103 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 104 Secondary Payments $0.00 Correct-paid Medicare patient responsibility 105 Multiple Procedure Reductions $0.00 Primary procedure-info only 106 Multiple Procedure Reductions $277.71 Manual processor error-too old to recover per BCBSFL 107 Multiple Procedure Reductions $0.00 Reduced correctly 108 Multiple Procedure Reductions $0.00 Reduced correctly 109 Multiple Procedure Reductions $0.00 Reduced correctly 110 Multiple Procedure Reductions $0.00 Reduced correctly 111 Outpatient with Admission $410.08 Agreed error-provider should have billed with IP claim 112 Outpatient with Admission $0.00 Inpatient claim-informational only 113 Outpatient with Admission $0.00 Not related to admission 114 Outpatient with Admission $0.00 Inpatient claim-informational only 115 Pre-Admission Testing $473.25 Agreed error-provider should have billed with IP claim 116 Pre-Admission Testing $0.00 Inpatient claim-informational only 117 Pre-Operative Testing $640.48 Agreed error-provider should have billed with OP surgery claim 118 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 119 Pre-Operative Testing $719.24 Agreed error-provider should have billed with OP surgery claim 120 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 121 Pre-Operative Testing $627.20 Agreed error-provider should have billed with OP surgery claim 122 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 123 Pre-Operative Testing $628.50 Agreed error-provider should have billed with OP surgery claim 124 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 125 Pre-Operative Testing $692.23 Agreed error-provider should have billed with OP surgery claim 126 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 127 Pre-Operative Testing $375.29 Agreed error-provider should have billed with OP surgery claim 128 Pre-Operative Testing $174.75 Agreed error-provider should have billed with OP surgery claim 129 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 130 Pre-Operative Testing $519.00 Agreed error-provider should have billed with OP surgery claim 131 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 132 Pre-Operative Testing $959.00 Agreed error-provider should have billed with OP surgery claim 133 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 134 Pre-Operative Testing $628.50 Agreed error-provider should have billed with OP surgery claim 135 Pre-Operative Testing $923.00 Agreed error-provider should have billed with OP surgery claim 136 Pre-Operative Testing $0.00 Outpatient surgery claim-informational only 137 Timely Filing $0.00 Original claim filed in 10 days 138 Timely Filing $0.00 No timely filing in contract-default is 1 year 139 Timely Filing $0.00 Original claim filed in 10 days 140 Timely Filing $0.00 Original claim filed in 11 days 141 Benefits-ER Copayment $0.00 Secondary payment 142 Benefits-ER Copayment $0.00 Secondary payment 143 Benefits-ER Copayment $0.00 OOP met 144 Benefits-ER Copayment $0.00 OOP met 145 Benefits-ER Copayment $0.00 OOP met 146 Benefits-Inpatient Copayment $0.00 OOP met 147 Benefits-Inpatient Copayment $0.00 OOP met 148 Benefits-Inpatient Copayment $0.00 OOP met 149 Benefits-Inpatient Copayment $0.00 OOP met 150 Benefits-Inpatient Copayment $0.00 OOP met $76,140.74 Monroe County-Florida Blue Claims Audit Report September 6,2019 I Page 19 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Appendix B - Out-of-Sample Claims Audit Item Issue Overpayment Amt Comment 151 Other Insurance $525.73 Medicare primary 11/1/2011 per audit item#84 152 Other Insurance $145.44 Medicare primary 11/1/2011 per audit item#84 153 Other Insurance $156.15 Medicare primary 11/1/2011 per audit item#84 154 Other Insurance $32.22 Medicare primary 11/1/2011 per audit item#84 155 Other Insurance $170.34 Medicare primary 11/1/2011 per audit item#84 156 Other Insurance $267.83 Medicare primary 11/1/2011 per audit item#84 157 Other Insurance $161.17 Medicare primary 11/1/2011 per audit item#84 158 Other Insurance $170.34 Medicare primary 11/1/2011 per audit item#84 159 Other Insurance $116.74 Medicare primary 11/1/2011 per audit item#84 160 Other Insurance $116.74 Medicare primary 11/1/2011 per audit item#84 161 Other Insurance $116.74 Medicare primary 11/1/2011 per audit item#84 162 Other Insurance $179.41 Medicare primary 11/1/2011 per audit item#84 163 Other Insurance $116.74 Medicare primary 11/1/2011 per audit item#84 164 Other Insurance $120.77 Medicare primary 11/1/2011 per audit item#84 165 Other Insurance $713.25 Medicare primary 11/1/2011 per audit item#84 166 Other Insurance $170.34 Medicare primary 11/1/2011 per audit item#84 167 Other Insurance $357.11 Medicare primary 11/1/2011 per audit item#84 168 Other Insurance $314.11 Medicare primary 11/1/2011 per audit item#84 169 Other Insurance $240.98 Medicare primary 11/1/2011 per audit item#84 170 Other Insurance $89.28 Medicare primary 11/1/2011 per audit item#84 171 Other Insurance $120.77 Medicare primary 11/1/2011 per audit item#84 172 Other Insurance $145.36 Medicare primary 11/1/2011 per audit item#84 173 Other Insurance $296.67 Medicare primary 11/1/2011 per audit item#84 174 Other Insurance $99.65 Medicare primary 11/1/2011 per audit item#84 175 Other Insurance $502.88 Medicare primary 11/1/2011 per audit item#84 176 Other Insurance $253.31 Medicare primary 11/1/2011 per audit item#84 177 Other Insurance $445.33 Medicare primary 11/1/2011 per audit item#84 178 Retiree Coordination of Benefits $283.45 Medicare primary per sample item#89 179 Retiree Coordination of Benefits $350.30 Medicare primary per sample item#89 180 Retiree Coordination of Benefits $153.82 Medicare primary per sample item#89 181 Retiree Coordination of Benefits $114.77 Medicare primary per sample item#89 182 Retiree Coordination of Benefits $157.85 Medicare primary per sample item#89 183 Retiree Coordination of Benefits $91.75 Medicare primary per sample item#91 184 Retiree Coordination of Benefits $315.94 Medicare primary per sample item#91 185 Retiree Coordination of Benefits $2,275.00 Medicare primary per sample item#91 186 Retiree Coordination of Benefits $157.34 Medicare primary per sample item#92 187 Retiree Coordination of Benefits $932.61 Medicare primary per sample item#92 188 Retiree Coordination of Benefits $322.09 Medicare primary per sample item#92 189 Retiree Coordination of Benefits $141.01 Medicare primary per sample item#92 190 Retiree Coordination of Benefits $127.68 Medicare primary per sample item#92 191 Retiree Coordination of Benefits $144.10 Medicare primary per sample item#92 Totals $11,713.11 Monroe County-Florida Blue Claims Audit Report September 6,2019 I Page 20 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Appendix C — Operational Questionnaire Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Out-of-Network Providers 1. Describe relationships with available wrap-networks such as PHCS/Multiplan. We don't use multi-plan, a provider is either contacted or not. 2. Describe fee negotiation policies and thresholds when a contractual discount is not available along with any associated fees passed along to the group for savings achieved. Florida Blue utilizes its Non-Participating Provider Payment Rates Policy. 3. If UCR(Usual,Customary,and Reasonable)is applicable to the group,provide the database source and percentile utilized. If not contracted, we apply our non-par payment policy. The rate differs by provider type and we don't share the specifics. We use a 3rd party to validate our non-par rate is reasonable. 4. How are out-of-network claims handled for radiology,anesthesiology,pathology,and emergency in terms of potential balance billing to members? Out-of-network provider claims are processed using in-network benefits(in-network deductible and coinsurance). No balance billing protection for members except for emergency room services. Members are protected under Florida Statute 627-64194 that says an insurer is solely liable for payment of fees to a nonparticipating provider of covered emergency services provided to an insured in accordance with the coverage terms of the health insurance policy, and such insured is not liable for payment of fees for covered services to a nonparticipating provider of emergency services, other than applicable copayments, coinsurance,and deductibles.The member is protected from balance billing. 5. Describe any other non-participation methodology,such as percent of Medicare. See#3 Eligibility 6. Provide timing for eligibility updates including full files and change files. Updates should be submitted within 30 days of event date. The group is auto enrolled and weekly files are sent to FL Blue. If updates(changes/adds/terms)are sent after the 30 day period but within 90 days, a special exception is submitted.There may be occasion that the updates fall out of the 90 day window and management would then need to review for approval. 7. Describe processes in place to identify and adjust claims impacted by retroactive eligibility Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 21 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire terminations. Our system has a Hold, Deny and Reinstate process that will go in when a termination occurs. It will pick up and adjust the claims that were terminated retroactively. We also have a manual process where our Analyst team receives a report of claims associated with member termination and test to determine if the claims have been adjusted already or if they are denying accurately based on the termination date. Once the claims have been tested,then eligible claims are processed through an automated adjustment process(BRR). Coordination of Benefits 8. Describe how other insurance coverage is detected for members. Other insurance investigation occurs via member's applications, other insurance questionnaires and claims. If there is indication of another payer, we hold the claim for investigation. 9. How often are members asked to update other insurance information? Are claims pended if members do not respond to inquiries? Our other insurance information files are updated within 365 days of the authorization date. 10. Describe how ESRD members are identified for Medicare coverage and how the dialysis start date is determined. ESRD members are identified and investigated based on diagnosis of End Stage Renal Disease that is received on a claim. In connection with that investigation, we then update our files accordingly including the first date of dialysis(if applicable)and the 30 month coordination period. 11_ Describe secondary payment methodology for coordination of benefits with both commercial and Medicare other primary coverage. Florida Blue uses a modified Pay and Pursue methodology which means that the subscriber claims are paid,and dependent claims hold for investigation if any other insurance is indicated on the claim. We also use a standard COB lesser of logic payment method. Florida Blue determines the normal liability as if no other carrier payment existed,then determines Florida Blue's secondary liability using the primary carrier payment information.These two amounts are compared and Florida Blue pays the lesser of the two amounts. 12. How are secondary payments handled when the primary carrier denies the claim due to the member not following plan guidelines(such as failure to obtain preauthorization)? Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 22 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Our processing depends on the denial from the primary carrier. Example,see list below. Note,N/A in the Not Cov Rsn field below indicates FB would pay as primary.FB denies if"OCPAY". ANSI 'COB Adj Rsn' 'Nat Cav Description Rsn'field Code field 39 SERVICES DENIED AT THE TIME AUTHORIZATIONS/PRE- OCONC N/A CERTIFICATION WAS REQUESTED. 62 PAYMENT DENIED/REDUCED FOR ABSENCE OF,OR OCONC N/A EXCEEDED,PRE-CERTIFICATION/AUTHORIZATION. 197 PRECERTIFICATION/AUTHORIZATION/NOTIFICATION ABSENT. OCADD OCPAY 198 PRECERTIFICATION/AUTHORIZATION EXCEEDED. OCADD OCPAY PAYMENT ADJUSTED BECAUSE PRE- 210 CERTIFICATION/AUTHORIZATION NOT RECEIVED INATIMELY OCADD OCPAY FASHION. PAYMENT ADJUSTED BECAUSE PRE- 210 CERTIFICATION/AUTHORIZATION NOT RECEIVED INATIMELY OCADD OCPAY FASHION. PRECE RTI FICATION/AUTHOR IZATION/NOTIFICATION/P RE- 284 TREATMENT NUMBER MAY BE VALID BUT DOSE NOT APPLY OCONC N/A TO THE BILLED SERVICES. PAYMENT ADJUSTED BECAUSE THE SUBMITTED is AUTHORIZATION NUMBER IS MISSING,INVALID,OR DOES OCADD OCPAY NOT APPLY TO THE BILLED SERVICES OR PROVIDER. Third Party Liability 13. How are claims identified for potential third party liability or subrogation? As of February 1, 2015, the Legal Affairs Division handles subrogation recoveries. The process is outsourced to The Rawlings Group.We provide a claims dataset to Rawlings monthly. The Rawlings Group provides a full suite of recovery and cost containment services to the insurance industry. The process for investigating claims is as follows: ➢ Rawlings applies an exhaustive set of diagnostic,procedural,and billing codes that indicate every possible category of traumatic injury. ➢ Once the vendor identifies and verifies a recovery opportunity,a file is opened and assigned to an analyst. Analysts are supported by team attorneys. ➢ The analysts work with all parties,including first and third-party insurance carriers,attorneys,and providers to ensure subrogation rights are protected and every potential source for recovery is identified. Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 23 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Rawlings will send a monthly subrogation recoveries report to Florida Blue's finance department,and the finance department will handle all credits back to the Group. 14. Please provide a summary report of open and closed cases applicable to the audit period. See attached reports Duplicate Payments 15. Describe processes in place to prevent duplicate payments. Diamond, our claims processing system,contains logic to look for duplicate claims. If a claim is an exact duplicate based on defined criteria,the claim is a hard denial as a duplicate. If a duplicate is suspected,a hold is placed on the claim for manual research and intervention. 16. Are duplicates hard system denials or is manual intervention required? Both—see answer to#15 Medical Edits 17. Describe the system/software utilized for medical edits(unbundling,mutually exclusive procedures,age/sex/diagnosis mismatch,medically unlikely units,upcoding). Florida Blue uses Claims-Xten Rules Engine which is a component of Change Healthcare. These rules include those that are sourced from CMS as well as Change Healthcare proprietary edits, and integrates our payment policies to ensure accurate processing of claims to ensure medical edits are applied appropriately. Fraud 18. Describe procedures employed to identify potential fraud and abuse. Florida Blue's Special Investigations Unit(SIU) Florida Blue encourages its members to contact Florida Blue's Special Investigations Unit(SIU)in the event they suspect provider or member fraudulent activity. The SIU is comprised of individuals with various skills and backgrounds including registered nurses,certified medical coders as well as former law enforcement officers. Some of the investigators are Accredited Health Care Fraud Investigators,a unique professional designation granted by the National Health Care Anti-Fraud Association, and some are Certified Fraud Examiners, a designation denoting proven experience in fraud prevention, detection, deterrence and investigation. The responsibilities of the SIU include detecting and investigating potential cases of fraud, waste, and Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 24 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire abuse; referring documented cases to law enforcement and/or regulatory agencies; identifying overpayments and initiating recoveries; flagging providers to prevent inappropriate claim payments; and promoting fraud awareness throughout the enterprise and external agencies. The SIU uses anti-fraud software to assist in determining potential providers that are outliers within their specialty such as excessive use evaluation and management codes (office visits), surgery codes, chiropractic codes,etc. Data mining techniques are utilized to assist in identifying irregularities and trends within the Florida Blue claims data to detect potential fraudulent or abusive billing practices or vulnerabilities within our policies. These techniques are used to review the medical and pharmacy data as well as enrollment information. Personnel in SIU work closely with personnel from numerous areas of Florida Blue,including its joint ventures,e.g.,Prime Therapeutics,New Directions,CareCentrix,etc. 19. Does the TPA utilize or maintain a database of known fraudulent providers? Yes 20. Does the TPA have a dedicated Special Investigations Unit? See#18 21. If available,provide any summary reports or issues of fraudulent activity identified for the group. E s no fraudulent activity identified for this group. Hospital Bill Audits 22. Describe the process,if any,for hospital bill audits applicable to the group's claims. The contractual reimbursement determines if a bill audit is performed. Internal staff perform unbundling audits, versus a bill audit compared to the chart FB also engages a vendor that performs bill audits based on the contractual reimbursement of the provider. These audits are based on a comparison of the medical record to the itemized bill. They validate whether the services billed were rendered. 23. How are bill audit findings refunded to the group and how is the fee for the review determined? The overpayment credits are included in the monthly invoicing details. Florida Blue absorbs the costs for such reviews. Appeals 24. Describe the appeals process for both members and providers including relevant deadlines and decision points. Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 25 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire All member appeals are outlines in the member's benefit booklet. An inquiry may be received which contains a request to review a claim where the payment or lack of payment is disputed.This review process is known as an appeal. There are several different appeal procedures that can be used depending on the type of appeal sent. In this section the processes have been broken down into three sections: Provider Appeals ERISA General Internal Appeals The Service Associate must first determine who is sending the request. If a Florida provider is requesting an appeal,there is an appeal process based on Senate Bill 46E that must be followed.These appeals are for both participating and non-participating providers. Employee Retirement Income Security Act(also known as ERISA)became effective in 07101/02.This federal mandate addresses appeals from the Subscriber, however,there are exclusions. Not everyone can submit an appeal. The following people are able to submit appeals for denied claims. Subscribers Designated representative:This person must be designated in writing by power of attorney(POA)or appointment of representative(AOR) Dependents over 18 years old A Provider cannot submit an ERISA appeal unless he/she is a designated representative. If a Provider wants to appeal, he/she will follow the current appeal process for Providers. A provider claims appeal is a written request from a physician or provider for reconsideration of a claim payment, reduction,or denial. This does not include: Pre-service review requests(predetermination) Claim status requests Telephone inquiries for claim corrections and adjustments To file an appeal the provider is encouraged use the Provider Claim Appeal Form. This form can mailed/faxed or downloaded by the provider from www.Florida Blue.com, Participating Provider, Reference Tools, Provider Forms. Once the form is received in Front End Services, it will be forwarded to the appropriate operational area and batched as correspondence. The operational areas have 60 days to complete the appeal process and notify the provider of the outcome. Claimants have 365 days from when a claim denied to file an appeal. Florida Blue has the following time to reply to appeals: 72 hours for urgent care claims(urgency determined by physician) 30 days for non-urgent pre-service claims 60 days for post-service claims Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 26 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Utilization Review 25. Describe process in place to ensure medical necessity for procedures billed by providers. Providers have a list of resources from our online portal to help regarding medical necessity,and which procedures require prior authorization. This online resource lets the provider know who they should submit authorization requests to for specific services. Requests for all DME, Medical Supplies, and orthotics/prosthetics must be coordinated statewide through CareCentrix. Physicians should contact National Imaging Associates(RadMD.com)to authorize or obtain pre-service review for CT scans,CTA's, MRls/MRAs, PET Scans and nuclear medicine. Other services are authorized through Availity. Authorizations are not a guarantee of payment. If a claim does not have an authorization or the information submitted does not meet the requirements of medical necessity a claim will receive a claim hold for an examiner to research authorizations and medical policy to determine if the procedure code and diagnosis code billed meets the definition of medical necessity. If a determination cannot be made and supporting documentation is attached to the claim, the claim will be sent to our nurses in the Medical Review department to make a determination of medical necessity. The provider also has access to a wide range of tools to assist them(forms, medical and pharmacy guidelines, a provider manual, marketplace health plans, etc.). https://www.floridablue.com/providers/tools-resources/overview See attached PDF regarding Standing Authorizations 26. Describe the system interface between claims payment and required referrals or pre-certifications. Florida Blue uses an automated software interface to transfer authorization and referral data from the Jiva Care Management system to the Diamond claims processing system. Diamond then uses automated logic to match authorizations and referrals to the appropriate claims during the claims adjudication process. Case Management — 27. How are members selected for case management activity? 28. Describe case management activities and goals. d 29. Are additional fees charged to the group for case management? Monroe County—Florida Blue Claims Audit Report September 6,2019 1 Page 27 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Internal Claims Audit 30. Describe internal claims audit activity in place for the group including number of claims audited, frequency,and selection parameters. Claims for this group are included within the population of claims processed within our NSA(National Strategic Accounts)group. NSA has 123-124 claims audited each month.This breaks down to approximately 31 claims per week that are randomized between each strata from the total population. There are 12 Strata's the population count is randomized from to get our sample size from: Strata Lowy and High Dollar Umkt 1 $0 00 - $0 00 2 $0 01 S60 00 3 $60.01 - $150.00 4 $150,01 $559.00 5 $559.01 $1453.00 8 $1453.01 - $3348.00 7 $3348.01 - $6208.00 8 56208.01 - 59986.00 9 59986.01 - $27472.00 10 $27472-01 $61554.00 11 $61544.01 $121854.00 12 $121854.01 - $999999999.99 The audit period requested 01/01/2017-12/31/2018(2 years)we have completed 2971 NSA claims audits. 31. Provide any internal claims audit performance results applicable to the audit period. • YTD 2017-1483 sampled claims -3,761,008 Population -3 Processing Defects(99.63%Frequency Accuracy) -8 Financial Defects -Underpayments totaling$937.91 -Overpayments totaling$7,765.11 • YTD 2018-1488 sampled claims -3,881,307 Population -3 Processing Defects(99.96%Frequency Accuracy) -3 Financial Defects -Underpayments$0.00 -Overpayments$2,722.90 Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 28 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire 32. Is there a high-dollar threshold that automatically triggers an audit or supervisor sign-off for an individual claim? Yes, institutional claims with an allowance of$25,000 or higher and professional claims with an allowance of $10,000 or higher are audited for all lines of business. 33. Provide recent report of processor override volume. Will discuss during the onsite visit Refund Activity 34. Does the TPA utilize retractions(offsets)to recover identified overpayments or are refund request letters utilized? Two forms of collection are available—direct payment and offsetting,with preference given to offsetting.We only recover overpayments from par providers via offsetting. Offsetting will begin on the 61 st day. Nonpar overpayments can only be recovered via offsetting when the non-par provider requests offsetting. 35. Describe the timing of retractions or refund requests. Florida Blue uses a vendor(Optum)to assist with recovering overpayments. We send overpayments to the vendor monthly, only after the invoice has aged 105 days. Prior to the 105th day, 3 monthly statements are sent to the customers. If the overpayment has not been received,then the item will be sent to the outside vendor 36. Please provide a report of all open refunds(no cash collection to date)for the group that is applicable to the audit period. Please see attached report titled"List of OS ARs_B061 V Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 29 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Monroe County 2017-2018 HEALTHCARE HORIZONS BCBS of Florida CONSULTING GROUP, INC. Operational Questionnaire Customer Service 37. Please provide available reports to address the following:average speed to answer member customer service calls,call abandonment rate,first call resolution(no repeat calls for same issue), member inquiry mix(phone,email,paper),inquiry resolution timing,inquiry mix,and any member satisfaction survey results. Reports at the NSA level are attached for 2107 and 2018 Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 30 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Appendix D - Florida Blue Performance Guarantee Scorecard 2017-2108 FLorcd�B&e Monroe County Board of County Commissioners " °°ePM°" "`�" °""` Performance Guarantee Scorecard 2017 - 2018 p-d s�eet�n� Performance Measurement 4th Qtr 2017 1st Qtr 2018 2nd Qtr 2018 3rd Qtr 2018 Plan Year Score Member Touchpoints Abandon Rate-5%or less 0.35% 0.34% 0.32% 1.02% 0.51 Average ACID Queue Time-30 seconds or less 9.22 9.69 9.96 20.75 12.41 Blockage Rate-8%of calls blocked during business 0.45% 0.49% 0.44% 0.18% 0.39% hours Enrollment Timeliness- 99%of ID cards mailed by effective date provided that the enrollment data is 100% 100% 100% 100% 100.00 received from group 30 days prior to the effective date of coverage Claims Processing Timeliness-97%in 30 Days 99.64% 99.73% 99.82% 99.65% 99.71 Claims Processing Accuracy-97%or greater 99.95% 100.00% 100.00% 99.99% 99.99 Claims Dollar Accuracy-98%or greater 99.88% 100.00% 100.00% 99.97% 99.96 Inquiry Timeliness-90%of inquiries finalized within 7 99.67% 99.63% 99.68% 99.71% 99.67 calendar days Monroe County-Florida Blue Claims Audit Report September 6,2019 I Page 31 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Appendix E — Florida Blue BOCC Corrective Action Plan Monroe County Board of County Commissioners Audit of Claims Paid January 2017—December 31,2018 Corrective Action Plan Executive Summary Recognizing the results of the audit performed by Healthcare Horizons Consulting Group,Inc., Florida Blue remains deeply committed to continuously improve its policies and procedures in order to ensure that all claims are processed correctly and on time. Florida Blue initiated a careful analysis of each of the forty-three(43)in-sample and forty-one (41)out-of-sample errors referenced within Healthcare Horizons audit report.This research included the use of subject matter experts to identify the root cause(s)for each error. The following information pertains to those research efforts. Recoverable Findings Duplicate errors(11 in-sample,0 out-of-sample): 1. Report Finding: Samples 934,#38,#40,#42,#44,946,447,#50,952,#54,and 955 Florida Blue has effective system edits in place to prevent duplicate payment errors. Our initial analysis yielded a small volume of potential duplicates that were submitted in the sample selection. Florida Blue Agreed with 11 duplicate payment errors totaling$8,131. Florida Blue Response: We agree with the audit finding. The overpayments occurred on each claim because of examiner error. The examiners responsible for processing those samples have since received appropriate feedback and coaching. Samples#34,44,and 46 were adjusted on 4/08/19,while samples#50,52,54 and 55 were adjusted on 4/11/19. Sample#38 was adjusted on 8/25/19. Samples#40,#42,and#47 cannot be adjusted because of timely filing limitations for Blue Card claims. Accordingly,the combined overpayment of$3,991.03 is not recoverable. Retroactive Eligibility Terminations(12 in-sample,0 out-of-sample): 2. Report Finding: Samples#59, #60,#61,#62,#63,#64,#65,#66,#67,#68,#69,and#75 All claims in the dataset were tested for eligibility base on the historical eligibility file by Florida Blue. We identified eleven(11)claims with a service date after termination and one claim during a gap in coverage. -I- Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 32 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Florida Blue Response: We agree with the audit finding. Sample 959—The group performed a retro-termination,effective 12/31/17,on 3/27/18. The sample claim,with a 1/26118 service date,processed prior to the retro term. The sample claim was adjusted on 4/11/19. Samples 460—The group performed a retro-termination,effective 5/01/18,on 6/22/18. The sample claim,with a 5/21118 service date,was processed on 5/29/18. Upon further review,the member's termination date was revised to 8/01/18. As a result,the sample claim does not warrant adjustment. Samples#61-#63—The group performed a retro-termination,effective 7/31/18,on 09/10/18. The sample claims,all with a service date of 8/06/18,processed prior to the retro term.The sample claims were adjusted on 4/11/19. Sample 964—The group performed a retro-termination,effective 9/04/18,on 11/06/18. The sample claim,with a service date of 10/18/18,processed prior to the retro term.The sample claim was adjusted on 4/11/19. Sample#65—The group performed a retro-termination,effective 10/17/18,on 11/12/18. The sample claim,with a service date of 10/26/18,processed prior to the retro term date. The sample claim was adjusted on 4/11/19. Sample 966 and*67—The group performed a retro-termination,effective 11/02/18,on 12/13/18. The sample claims,each with a service date of 11/16/18,were processed prior to the retro term. The sample claims were adjusted on 4/11/19. Sample 968—The group performed a retro-termination,effective 11/15/18,on 1/22/19. The sample claim,with a service date of 12/04/18,was processed prior to the retro term.The sample claim was adjusted 08/26/19. Sample 969—The group performed multiple retro-terminations and reinstatements. The sample claim,with service date of 7/31/17,processed prior to the retro term. The sample claim was adjusted 04/11/19. Sample 975—member's enrollment history showed multiple updates. The service date for the claim was 5/27/17. Upon further review,the member had eligibility throughout 2017. Accordingly,the sample claim does not warrant adjustment. Appropriate efforts have been initiated to ensure that all previously processed claims impacted by retro-termination activity are adjusted and denied in a timely manner. -2- Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 33 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Retroactive Notification of Other insurance—missed coordination of benefits(2 in-sample, 27 out-of-sample): 3. Report Finding: Samples#82 and#84(in-sample) Healthcare Horizons utilized the claims data to identify members with other primary insurance based on a coordination of benefits(COB)savings amount present on certain claims. We then test for the same members with no COB savings to determine if coordination with a primary carrier was missed. Florida Blue agreed that two claims have missed coordination of benefits. Healthcare Horizon's delivered 27 additional out-of-sample claims for review and Florida Blue confirmed those additional claims were over-paid. Florida Blue Response: We agree with the audit finding. For sample#82,root cause pertains to receiving late notification(on 9/24/18)of other insurance that was effective 10/01/17—12/31/17. The sample claim processed on 10/26/17 with a service date of 10/16/17. Timely filing rules prohibit the adjustment of the claim. Accordingly,sample 02,with a total paid of$2,783.47,is not recoverable. Our review of the member's claims history identified no other claims that warranted adjustment for other insurance. For sample#84,coordination did not occur with the primary payer,Medicare Part B effective since 11/01/11 (the member's enrollment date with Florida Blue)because of an examiner error. The examiner responsible for processing the claim has since received appropriate feedback and coaching. Timely filing rules prohibit the adjustment of the claim. Accordingly,sample#84, with a total overpaid of$852.57 is not recoverable. For samples#151 -#177(the 27 additional out-of-sample claims all of which pertain to the member associated with sample 984 above and all of which were out-of-state claims),Florida Blue agrees that coordination efforts did not occur with the primary payer,Medicare Part B. Timely filing rules prohibit the adjustment of all 27 claims. Accordingly,the combined overpayment of$6,145.40 cannot be recovered. Missed Coordination of Benefits with Medicare—Retirees age 65 and higher(4 in-sample, 14 out-of-sample): 4. Report Finding: Samples 989,990, 491,992 In reviewing the full paid claims dataset,Healthcare Horizons identified four retirees age 65 and higher where no coordination of benefits with Medicare primary coverage occurred. -3- Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 34 HEALTHCARE HORIZONS CONSULTING GROUP, INC. Florida Blue Response: We agree with the audit finding. For samples#89,90,and 91,root cause is examiner error. The examiners responsible for processing these claims have since received appropriate feedback and coaching. Timely filing rules prohibit the adjustment of samples 989 and 91 with a combined overpayment of$9,863. Sample 990,with an overpaid of$6,200,was adjusted on 5/01/19. For sample#92,the overpayment occurred because Florida Blue was listed incorrectly as the rimai a er in the member's order of liability file. Timely filing rules prohibit the adjustment of the claim. Accordingly,the overpayment of$38,961 cannot be recovered. Samples#178-#191 (14 claims)pertain to the 3 members associated with samples 89,91,and 92 above. Research effimunde e the reason for each ove� Timely filing rules prohibit the adjustment of any of the claims. Accordingly,the combined overpayment of$5,568 cannot be recovered. Multiple Procedure Reduction caused by fragmented billing(1 in-sample,0 out-of-sample): 5. Report Finding: Sample#106 Healthcare Horizon's identified only a single error in the dataset where multiple procedure reductions were not applied correctly. Florida Blue Response: We agree with the audit finding. An overpayment occurred because of an examiner error. The examiner responsible for processing the claim has since received appropriate feedback and coaching. The sample claim(with an overpayment of$278)cannot be adjusted because of timely filing limitations. Provider billing errors—outpatient services on the same day of admission,pre-admission testing and pre-operative testing. (13 in-sample,0 out-of-sample): 6. Report Finding: Samples#111,#115,9117,9119, 9121,#123,#125,#127,9127,#130, #132,4134, and#135 Healthcare Horizon's identified a total of 13 claims where outpatient services(for pre- admission testing or pre-operative testing)were billed separately and not with the corresponding inpatient or outpatient surgery claims. Florida Blue Response: We agree with the audit findings. An overpayment occurred after the two(2)underlying facilities failed to follow Florida Blue's payment policy that applies to pre-admission testing -4- Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 35 HEALTHCARE HORIZONS CONSULTING GROUP, INC. and pre-operative testing. The charges for such services should have been included on the related inpatient claim or outpatient surgery claim. A project has been initiated to help prevent these services from paying separately when providers bill pre-admission testing or pre-operative testing separate from the corresponding inpatient hospital claim or outpatient surgery claim. Until the project is fully implemented(scheduled for later this year),a work-around was implemented by our Payment Integrity Office(PIO)who runs a weekly report to identify potential claims warranting adjustment. The PIO conducts an audit on such claims and then initiates overpayment recovery efforts,where applicable. The 13 samples claims were adjusted on 8/26/19. -5- Monroe County—Florida Blue Claims Audit Report September 6,2019 I Page 36