SOAH Stoploss Claims get Panel Decision - January 12, 2007

A panel of 9 Administrative Law Judges rendered a decision on the current stoploss issue.  The
actual
rule reads that claims with charges greater than $40,000 are the be paid at 75% of audited charges.
Through the years, the carriers have tried several approaches in reducing the level of payment
under the 75% threshold.  They have reduced high-dollar implants to see if the remaining charges
were over the $40k threshold. For some time, this was the generally accepted allowable calculation.  
Others tried to re-define the word "audit" to mean an auditor or audit company could do a line-item
reimbursement calculation, add them up, and, if over $40k, could pay 75% of the "audited" amount.  
A few carriers even went as far as to say they weren't going to acknowledge the stoploss and would
continue processing claims at the applicable perdiems with any carveouts.

In recent activity, carriers were requiring providers to prove the claim was "unusually costly or
extensive". Tough argument when you could not compare to other claims!  We believe this strategy
could have been taken from Louisiana rules which DO require providers to request a
reconsideration for what is called an outlier. After meeting certain financial guidelines regarding the
total charges, then you must show evidence the claim is "atypical in nature".  Both of these
arguments are subject to the reviewers opinion; thus not allowing a "fair" reimbursement amongst
the hospitals.

The panel ruling addressed many of the above issues.  Below are some of the actual orders from
the ruling. Comments in red are from HRA.

All eligible items, even implants & prosthetics, are included in the calculation of the $40,000
threshold.
       This seems positive for the providers.  

In calculating whether the stoploss threshold has been met, all eligible items are included at the
hospital's UCR charges, in the absence of an applicable MARS or specific contract.
       This seems to contradict the above as we DO have a MARS schedule (cost plus 10%) for
implants & prosthetics.

The carve-out reimbursement amounts contained in 28 TAC Sec. 134.401(c)(4) are not used to
calculate whether the stoploss threshold has been met.
       134.401(c)(4) regards the carveout and payment of implants at cost + 10%.  We are
concerned as to whether or not they are saying the carriers can or cannot reduce the implants from
the charges, calculate cost + 10%, then add the now-reduced amount back into the total.  This was
a practice of many major carriers but only for a short time.

When the stoploss reimbursement methodology applies to a work comp admission, all eligible items,
included items listed on 134.401(c)(4), are reimbursed at 75% of their post-audit amount.
       Seems like a we are in favor of the hospital here; however, the definition of "audit" is discussed
ion the decision but not defined in the actual orders.

Items listed in 134.401(C)(4) are not reimbursed at the carve-out amounts provided in that section
when the stoploss methodology applies.
       We are getting a little clearer here; however, I foresee the carriers saying "the order says they
are not paid at cost + 10%.  It never told us what to pay, so we reduced it to our UCR rate!"

This is the fun stuff we get to ready frequently regarding any reimbursement in Texas. Whether it is
a UCR rate or a %-over-Medicare, providers, carriers and TDI cannot get on the same page.  

When HRA discussed this issue with an attorney, we questioned "What exactly does this mean?" His
response, "Not much. The issue will probably not be resolved in mine and your lifetime."



For more info or a copy of the decision, please contact Angie Box at (817) 200-2820, ext. 206