Business Briefs: Arrange for “Direct Supervision” Before Scheduling Patients

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  A majority of today’s wound clinics have been designated by the Centers for Medicare & Medicaid Services (CMS) as provider-based. The requirements to be considered provider-based can be found at 42 CFR 413.65. Some of the provider-based departments are “on campus” (within 250 yards of the main buildings of the provider) while others meet numerous criteria (including farther than 250 yards, but within 35 miles) to be considered “off campus”. In order to receive Medicare coverage via the Ambulatory Payment Classification (APC) system, for outpatient therapeutic services provided in the provider-based departments, they 1) must be furnished by the hospital, in the hospital, or a provider-based department of the hospital, 2) must be an integral, although incidental, part of a physician’s service, 3) must be furnished under “direct supervision, and 4) must be ordered by a physician or a non-physician practitioner (NPP), e.g., a nurse practitioner, physician assistant, or clinical nurse specialist.

  The “under direct supervision” coverage and payment requirement has created turmoil in hospital-based outpatient wound care departments (HOPDs) ever since 2009. At that time, CMS declared that they intended APC-paid HOPDs to be under direct supervision ever since the APC payment system began in 2000. Hospitals were confused by this requirement: many of them believed that they met the direct supervision requirement because they had: physicians on campus and in their offices; physicians in the emergency department; physicians in the operating room; residents on the premises, etc. (See Exhibit A for the direct supervision coverage Medicare requirements for 2009 through 2011). NOTE: Critical access hospitals and rural hospitals have been exempt from the direct supervision rules, but should begin preparing to implement the direct supervision staffing requirements because they may not be exempt after 2011.

  In 2009 CMS caught many HOPDs off-guard when they stated that only MDs, DOs, and DPMs could provide direct supervision to HOPDs. Then in 2010 CMS relaxed the requirements and allowed NPPs to provide direct supervision for HOPDs when their state licenses allowed them to do so.

  In 2009, the MD, DO, or DPM was required to be in the department whenever patients were receiving therapeutic services, such as wound care. In 2010 the off-campus and on-campus HOPDs had different requirements. In 2010 the MD, DO, DPM, or NPP providing direct supervision was still required to be in the department whenever patients were receiving therapeutic services in off-campus HOPDs. The supervising providers were permitted to be anywhere on the hospital campus while patients were receiving therapeutic services in on-campus HOPDs.

  Because CMS is serious about these coverage and payment regulations, all APC-paid HOPDs must clearly understand the 2009 and 2010 direct supervision regulations. CMS has stated that they will not audit HOPDs for compliance with the direct supervision regulations prior to 2009, but that HOPDs would be at risk for audits and monetary repayments if they did not meet the direct supervision requirements in 2009 and beyond. Note: If your HOPD did not comply with the 2009 and 2010 regulations, you should discuss this situation with your compliance officer.

  The 2011 Outpatient Prospective Payment System (OPPS) Final Rule was released on November 2, 2011 and published in the Federal Register on November 24, 2010. The direct supervision regulations for the on-campus and off-campus HOPDs are now identical:

    • Services must be provided under direct supervision by a MD, DO, DPM, or NPP who is qualified to personally perform them within their license and hospital bylaws.

    • The health care professional providing the direct supervision must be “immediately available” to provide assistance and direction throughout the performance of the procedure. Immediately available means that the supervisory professional must be physically present, interruptible, and able to furnish assistance and direction throughout the performance of the service and/or procedures. It does not mean that the physician or NPP must be present in the hospital or in the room when the procedure is performed. The 2011 regulations no longer specify location requirements.

    NOTE: Telecommunications does not meet the immediately available and physically present criteria.

    • Services must be ordered by a physician or NPP

  Following are some tips for maintaining compliance with the 2011 direct supervision OPPS coverage and payment regulations.

    • To begin the direct supervision implementation process, clearly state the HOPD’s hours of operation, and the level of services and procedures that the supervising health professional must be skilled to perform

    • Decide what is a reasonable definition of “immediately available” and “able to intervene right away” for your particular HOPD. Be ready to defend your definition and the expected response time to an auditor.

    • Identify the health professional(s) that can meet all of requirements

    • Establish the scheduling process so the health professional(s) will know exactly when he/she is providing direct supervision for the HOPD and all members of your staff will know who to call. The physician or NPP must know what services and/or procedures he/she is supervising, who is providing that service/procedure, and when that service/procedure is being performed.

    • Decide how staff will contact the supervising health professional if he/she is not in the HOPD

    • Maintain records that can prove to an auditor who provided direct supervision on any given day.

    • Do not issue Advanced Beneficiary Notices of Non-Coverage when direct supervision is not available.

  If you have not implemented the 2011 direct supervision regulations, you should discuss that oversight with your compliance officer and immediately develop a process to have direct supervision available at all times when patients are in your HOPD.

Kathleen D. Schaum, MS, is President and Founder of Kathleen D. Schaum & Associates, Inc., Lake Worth, FL. Ms. Schaum can be reached for questions and consultations by calling 561-964-2470 or through her email address: kathleend­schaum@bellsouth.net.