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Effect of Aggregate CAP on Overall Reimbursement to Medicare-Certified Hospices

Effect of Aggregate CAP on Overall Reimbursement to Medicare-Certified Hospices February 3, 2015

Effective for 2014 and future CAP years, every hospice provider must submit a CAP calculation to their Medicare Administrative Contractor (MAC).  The information below is provided to answer basic questions surrounding the CAP calculation.  If you have questions regarding this process, require assistance in completing any of the steps, or would like for us to help in any way, our staff is always available to support you.

When are CAP calculations due?

The aggregate CAP year runs from November 1st to October 31st of each year.  The provider’s CAP calculation is due no earlier than three months after the close of the CAP year (January 31st) and no later than five months following the close of the CAP year (March 31st).  Failure to submit the self-determined aggregate CAP calculation within this timeframe will result in suspension of payment.

How do providers prepare the calculation?

The total actual Medicare payment made for services furnished to Medicare beneficiaries during the CAP year (November 1st to October 31st) is compared to the aggregate CAP for this period.  Any actual Medicare payments in excess of the aggregate CAP must be refunded by the hospice at that time.

Making the calculation is a multi-step process, but none of the steps are difficult:

1.   Identify the calculation method of your CAP.  It will be either the streamlined method or the proportional method.  The easiest way to confirm which method is utilized is to review the last CAP computation letter from your MAC, or you can contact your MAC and confirm the method used.  Providers who were certified on or after October 1, 2011 should be on the proportional method.  If you were certified prior to October 1, 2011 you could be on either method.  However, hospices certified prior to October 1, 2011 should have received a one-time election to continue using the streamlined method for CAP years 2012 and beyond.  If you did not file an election to continue on the streamlined method, then you should be using the proportional method.

2.   Access your beneficiary counts through the new EIDM system after February 8, 2015.  You can determine your beneficiary counts through your PS&R report by accessing miscellaneous reports and selecting the Beneficiary Count (CAP report).

a.   If you are using the streamlined method, the beneficiary period is September 28, 2013 – September 27, 2014.

b.   If you are using the proportional method, the beneficiary period is November 1, 2013 to October 31, 2014.

c.   You can access multiple year reports.

d.   The initial period service dates are November 1, 2011 – October 31, 2012.

It is recommended that you run reports for prior CAP years 2012 and 2013, as well as, the current CAP year.

If you are using the streamlined method you should run both streamlined and proportional method reports for comparison purposes (See 5a).

3.   Prepare your interim CAP report using the spreadsheet template CMS is expected to provide on or before February 25th.

a.   You can submit your CAP report as soon as it is completed, but no later than March 31, 2015.

b.   If your counts differ from the PS&R reports, you can submit additional computations in support of your calculation to supplement the PS&R.

c.   You should run your PS&R beneficiary counts as soon as possible after January 31st as this will generally be beneficial to the provider.

d.   If you are using the streamlined method, you should prepare calculations using both the streamlined and proportional methods (See 5a).

The calculation will look something like this:

Description Through Dates Computation
Medicare Beneficiary Count for Beneficiaries paid through 2/9/2015 50.80
Aggregate CAP (published annually) $26,157.50
Allowable Medicare Payments $1,328,801
Actual payments from the PS&R 2/9/2015 (1,200,000)
Aggregate CAP in excess of payments $128,801

 

4.   If you have not received a final settlement for prior years, recalculate them to confirm the expected final settlement has not changed.

a.   Remember – your calculation is only an interim settlement.  The MAC will issue a final settlement, usually between August and October of the year following the close of the CAP year.

5.   If you are using the streamlined method:

a.   Determine whether you may benefit by switching to the proportional method by comparing both results.

b.   If you elect to change to the proportional method note that there is a look back to the 2012 and 2013 CAP years when switching methods, so you will need to calculate the CAP for each of these years using the proportional method to see if you owe money for a prior year.

c.   You must file your election to change methods prior to, or with the, submission of your annual report and in no case later than March 31st.

What happens when beneficiaries move between agencies?

In the case in which a beneficiary has elected to receive care from more than one hospice, each hospice includes its prorated portion of a patient’s total stay.  This calculation is automatically included in the Beneficiary CAP count within the PS&R.

What happens if I owe money?

1.   Payment must be remitted with the CAP report on or before March 31, 2015.

2.   You can submit a request for an extended repayment schedule.

3.   You should immediately implement a plan to monitor your CAP regularly.

What about the Payments for Inpatient Care CAP?

While this letter is focused on the aggregate CAP, do not forget that there is also a CAP on inpatient days.

During the 12-month period beginning November 1st and ending October 31st of each year, the aggregate number of inpatient days for general inpatient care and inpatient respite care may not exceed 20% of the aggregate number of days of hospice care provided to all Medicare beneficiaries in that hospice during that same period.  This limitation is applied once each year, at the end of the hospice’s “CAP period” (November 1st – October 31st).

Where can I read about this?

Medicare Benefits Policy manual Chapter 9, Section 90

 

HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance and statisticians that are available to provide expert assistance with your Medicare and Medicaid compliance programs.

DISCLAIMER: This post contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link. Any advice or recommendations given is general and specific questions should be directed to professional counsel.

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