Improper Investing by Pension Funds and Investment Advisory Firms Using Unprotected Investment Strategies is Costing Trillions
Austin, TX (PRWEB) July 20, 2010
Skyline Capital Managements’ patent pending method of money management designed to preserve and protect principal, supported by 10 years of back-tested data, is now available to Registered Investment Advisors and Public & Private Pension funds and institutions.
According to BNY Mellon Asset Management, “The funded ratio of the typical corporate U.S. pension plan fell 6 percentage points in June 2010 to 74%, the result of U.S. stock market declines and low interest rates.” The average corporate pension fund is under-funded by 26%, which is dramatic.
“According to the Manhattan Institute for Policy Research, pension plans for public school teachers, which comprise about half of states’ total pension liabilities, were underfunded by $ 933 billion dollars in fiscal year 2008, almost three times the amount that the plans had reported,” as reported by Fortune Magazine on June 18,2010.
According to the American Enterprise Institute, “States report that their public-employee pensions are underfunded by a total of $ 438 billion, but a more accurate accounting demonstrates that they are actually underfunded by over $ 3 trillion. The accounting methods that states currently use to measure their liabilities assume plans can earn high investment without risk. Should plan assets fall short, as is likely, taxpayers are required to make up the difference.”
Pension funds are not taking appropriate steps to mitigate market risk using outdated methodologies such as asset allocation, sector rebalancing and non-hedging techniques. This lack of risk mitigation has cost institutions and both public and corporate pension funds Trillions in unfunded liabilities.
“Schwab found that, on average, financial advisory firms generated $ 6,900 per client in 2009. That’s a sizable drop from the $ 7,800 per client the firms generated in 2008. What’s more, the median operating income earned by an registered investment adviser fell from 15% of revenue in 2008 to barely 10% in 2009,” as reported by InvestmentNews.
This indicates market risk and losses have played a key role in Registered Investment Advisory firms realizing lower profits and revenues due to reductions of assets mainly from market losses.
In all the examples of revenue reduction and liability increases from market losses, could have been significantly reduced and avoided by using the VanderPal Method™ or Principal Protected Index™ program through Skyline Capital Management®.
The proprietary VanderPal Method™ and Principal Protected Index™ program allows for clients to receive capital gains in upward or downward moving markets or indices while 95% – 100% of the principal is invested into FDIC insured bank certificates of deposit or US government backed short-term notes. Earnings are reinvested back into principal to lock in previous returns on a continual basis, also referred to as the “Ratchet Effect.”
The significance of the VanderPal Method™ and Principal Protected Index™ program is the advantages over other principal protected programs such as structured notes/products, index certificates of deposit and index annuities. Many of these programs described earlier have substantial penalties, market risk if not held to maturity, lack of investing options, tax issues and no periodic and continual locking in of gains.
VanderPal Method™ and Principal Protected Index™ program provides:
No surrender penalties
Fully liquid
Long-term capital gains tax on majority earnings
Can participate in the gains-linked to various equity indices and thousands of stocks
Continually locking in returns creating a Ratchet Effect that periodically locks your gains into principal
95% – 100% of principal invested and backed though FDIC insured bank CDs and Government bills or notes.
“The VanderPal Method™ and Principal Protected Index™ program can remove the segment of market risk drowning pension funds into large liabilities and assist Registered Investment Advisors with maintaining more stable asset levels through less negative market volatility and angry clients,” says Dr. VanderPal.
For more information our website is www.SkylineCapitalManagement.net or contact Dr. Geoffrey VanderPal CFP® at 877-460-1570 ext. 102.
Skyline Capital Management® is a registered trade name for Principal Preservation Asset Management, LLC, a Texas registered investment advisory firm. Skyline Capital Management® specializes in principal preservation money management. Geoffrey VanderPal earned a Doctorate of Business Administration degree and maintains the Certified Financial Planner™ certification. Dr. VanderPal has over 18 years of professional finance and investment experience and teaches finance and economics at various universities.
# # #
Categories: Pensions Tags: Advisory, Costing, Firms, Funds, Improper, Investing, Investment, Pension, Strategies, Trillions, Unprotected, Using
Categories: Pensions Tags: Pension, Strategies
Recovery Audit Contractors and Medicare Audits: Successful Strategies for Defending Audits
I. INTRODUCTION
Get ready for increased Medicare auditing activity! The Centers for Medicare and Medicaid Services (CMS) Recovery Audit Contractor (RAC) program has been made permanent and is expanding nationwide, beginning this year. Radiology providers should act now to ensure they have adopted and implemented appropriate compliance programs. Radiology providers should make efforts to understand the Medicare appeals process and should know that many strategies exist that can be successfully employed in the appeals process to defend Medicare audits.
II. RECOVERY AUDIT CONTRACTORS
Section 306 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), directed the Department of Health and Human Services (HHS) to conduct a three-year demonstration program using RACs. The demonstration began in 2005 in the three states with the highest Medicare expenditures: California, Florida and New York. The RACs were tasked to identify and correct Medicare overpayments and underpayments, and were compensated on a contingency fee basis. The purpose of the demonstration program was to determine whether the use of RACs would be a cost-effective way to identify and correct improper Medicare payments.
The RAC demonstration program proved highly “cost effective” from the point of view of CMS. Over the course of the three-year demonstration, the RACs identified and collected $ 992.7 million in overpayments and repaid $ 37.8 million in underpayments to Medicare providers and suppliers. Based upon information compiled by CMS, the RAC demonstration program cost only 20 cents for each dollar returned to the Medicare Trust Funds.
Section 302 of the Tax Relief and Health Care Act of 2006 makes the RAC program permanent and requires the expansion of the RAC program nationwide by no later than 2010. CMS is actively moving forward with this expansion right now. During the final months of the demonstration program, RACs expanded into South Carolina, Massachusetts, and Arizona. CMS plans to expand to 19 states by summer 2008, four more states by fall 2008, and the remaining states by January 2009 or later. CMS plans to announce the names of the “permanent RAC” vendors sometime after July 31, 2008. Radiology providers in the first 19 states can expect the commencement of RAC auditing activity soon after the announcement of the “permanent RAC” vendors.
Although RACs are responsible for correcting underpayments as well as overpayments, it is the process of recouping alleged overpayments that is of particular significance to Medicare providers. Over the course of the three-year demonstration, the RACs identified and collected $ 992.7 million in overpayments and repaid just $ 37.8 million in underpayments to Medicare providers and suppliers. Thus, approximately 96 percent of the alleged improper payments identified were overpayments, as opposed to underpayments. The RACs are permitted to attempt to identify improper payments resulting from any of the following:
? Incorrect payments;
? Non-covered services (including services that are not reasonable and necessary);
? Incorrectly coded services (including DRG miscoding); and
? Duplicate services.
During the course of the demonstration project, Medicare providers and suppliers raised concerns with certain aspects of the RAC program. CMS has made efforts to address these concerns and has adopted numerous changes to be implemented in the permanent program. Some of these changes include the following:
? Under the RAC demonstration program, RACs were permitted to reopen claims up to four years following the date of initial payment. Amid arguments that this four year look-back period violated the “provider without fault” provisions of the Social Security Act, under the permanent RAC program, RAC reviewers have a maximum three-year look-back period. In all states (regardless of expansion date), the permanent program will begin with a review of claims paid on or after October 1, 2007. However, as time passes, the RACs will be prohibited from reviewing claims more than three years past the date of initial payment.
? Under the RAC demonstration program, the RACs were not required to employ a physician medical director or coding experts. However, under the permanent program, when performing coverage or coding reviews of medical records requested from a Medicare provider or supplier, nurses (RNs) or therapists are required to make determinations regarding medical necessity and certified coders are required to make coding determinations. The RACs are not required to involve physicians in the medical record review process; however the RACs are required to employ a minimum of one FTE contractor medical director (CMD), who is a doctor of medicine or doctor of osteopathy, and arrange for an alternate CMD in the event that the CMD is unavailable for an extended period. The CMD will provide services such as providing guidance to RAC staff regarding interpretation of Medicare policy.
? As noted above, CMS compensates RACs on a contingency fee basis, based upon the principal amount of collection (or the amount paid back to) a provider. Under the demonstration program, the RACs were entitled to keep their contingency fees if a denial was upheld at the first stage of appeal, regardless of whether a provider prevailed at a later stage of the appeals process. This fee arrangement provided incentive to the RACs to aggressively review and deny claims, including claims alleged to not be “medically necessary,” an area containing much subjectivity, and a category of denial often highly disputed by the provider. In fact, 40 percent of the alleged overpayments identified during the demonstration program were denied for reasons of medical necessity. For their efforts, the RACs earned $ 187.2 million in contingency payments over the course of the demonstration (or approximately 14.4 percent of all alleged improper payments identified). In a significant change from the demonstration program, under the permanent RAC program, if a provider files an appeal disputing an overpayment determination and wins this appeal at any level, the RAC is not entitled to keep its contingency fee and must repay CMS the amount it received for the recovery.
Medicare providers nationwide are well advised to begin preparing for the RACs and increased Medicare auditing activity now. Although providers cannot stop RAC audits from happening, they can implement appropriate compliance programs and make efforts to understand available audit defenses.
III. COMPLIANCE
Medicare providers nationwide are well advised to begin preparing for the RACs and increased Medicare auditing activity now. Radiology providers can begin to prepare by dedicating resources to:
? Internally monitoring protocols to better identify and monitor areas that may be subject to review;
? Responding to record requests within the required timeframes;
? Implementing compliance efforts, including but not limited to documentation and coding education. Notably, in addition to claim denials resulting from medical necessity and improper documentation and coding, it also is possible to receive claim denials if services are not provided consistent with Medicare regulations. Therefore, radiology providers should ensure that services provided are appropriately documented and coded, and also ensure that the provider is compliant with Stark, the Anti-markup rule, the teleradiology rules, the corporate practice of medicine doctrine, and IDTF standards (where appropriate) among other rules; and
? Properly working up appeals to challenge denials in the appeals process. With regard to medical necessity and similar denials, this will clearly entail physician involvement, which many non-physician providers and suppliers find difficult to obtain.
IV. MEDICARE AUDITS – The Medicare Appeals Process
As noted above, if a Medicare provider or supplier receives a claim denial, or a finding of overpayment is made as a result of a RAC review, the denial will be subject to the uniform Medicare Part A and Part B appeals process. The regulations governing this process are contained at 42 C.F.R. § 405.900 et seq.
Stage 1: Redetermination
The first level in the appeals process is redetermination. Providers must submit redetermination requests in writing within 120 calendar days of receiving notice of initial determination. There is no amount in controversy requirement.
Stage 2: Reconsideration
Providers dissatisfied with a carrier’s redetermination decision may file a request for reconsideration to be conducted by a Qualified Independent Contractor (QIC). This second level of appeal must be filed within 180 calendar days of receiving notice of the redetermination decision. There also is no amount in controversy requirement for this stage of appeal.
Prior to the establishment of the new appeals process, Part B providers, such as radiology providers, were afforded an in-person Carrier Hearing upon receiving an initial determination from the carrier. The QIC reconsideration replaces the Carrier Hearing. Importantly, the QIC reconsideration is an “on-the-record” review, contrary to an in-person hearing review. In conducting its review, the QIC will consider evidence and findings upon which the initial determination and redetermination were based plus any additional evidence submitted by the parties or the QIC obtains on its own.
Providers must submit a full and early presentation of evidence in the reconsideration stage. When filing a reconsideration request, a provider must present evidence and allegations related to the dispute and explain the reasons for the disagreement with the initial determination and redetermination. Absent good cause, failure of a provider to submit evidence prior to the issuance of the notice of reconsideration precludes subsequent consideration of the evidence. Accordingly, providers may not be permitted to introduce evidence in later stages of the appeals process if such evidence was not presented at the reconsideration stage.
Stage 3: Administrative Law Judge Hearing
The third level of appeal is the Administrative Law Judge (ALJ) hearing. A provider dissatisfied with a reconsideration decision may request an ALJ hearing. The request must be filed within 60 days following receipt of the QIC’s reconsideration decision and must meet an amount in controversy requirement. ALJ hearings can be conducted by video-teleconference (VTC), in-person, or by telephone. The regulations require the hearing to be conducted by VTC if the technology is available; however, if VTC is unavailable, or in other extraordinary circumstances, the ALJ may hold an in-person hearing. Additionally, the ALJ may offer a telephone hearing.
Stage 4: Medicare Appeals Council Review
The fourth level of appeal is the Medicare Appeals Council (MAC) Review. The MAC is within the Departmental Appeals Board of the U.S. Department of Health and Human Services. A MAC Review request must be filed within 60 days following receipt of the ALJ’s decision. Among other requirements, a request for MAC Review must identify and explain the parts of the ALJ action with which the party disagrees. Unless the request is from an unrepresented beneficiary, the MAC will limit its review to the issues raised in the written request for review.
Upon request, the MAC will grant the parties a reasonable opportunity to file briefs or written statements. Additionally, a party may request an opportunity to present oral argument. The MAC will grant this request if the case raises an important question of law, policy or fact that cannot be readily decided based upon the written submissions.
Stage 5: Federal District Court
The final step in the appeals process is judicial review in federal district court. A request for review in district court must be filed within 60 days of receipt of the MAC’s decision. In a federal district court action, the findings of fact by the Secretary of HHS are deemed conclusive if supported by substantial evidence.
V. STRATEGIES FOR DEFENDING MEDICARE AUDITS
Medicare providers subject to RAC or other Medicare audits should understand that many strategies exist that can be employed successfully in the appeals process to effectuate meaningful results. These strategies involve effectively advocating the merits of the underlying services as well as employing legal defenses.
Advocating the Merits
When advocating the merits of a claim, healthcare legal counsel assisting radiology providers often find it useful to draft a position paper outlining the factual and legal arguments in support of payment for a disputed claim. In addition, in most cases it is advantageous to engage the services of a qualified expert. Appropriate use of an expert can prove very useful, particularly when the audit involves medical necessity denials. In arguing the merits, other strategies that can prove successful include the use of medical summaries, illustrations, and color-coded charts or graphs depicting the claims at issue that are user-friendly for the decision maker.
Audit Defenses
In addition to advocating the merits of a claim through various techniques, certain legal defenses are available. Defenses that have proven valuable for providers challenging Medicare audit determinations include: invoking the treating physician rule, arguing the “Waiver of Liability” defense, arguing the provider is without fault, challenging the timeliness of the audit and/or claim denial, and challenging the statistical extrapolation (if one was involved).
A. Treating Physician Rule
It may be appropriate in many audit settings to assert the “treating physician rule.” The treating physician rule involves the legal principle that the treating physician, who has examined the patient and is most familiar with the patient’s condition, is in the best position to make medical necessity determinations. The treating physician rule, as adopted by some courts, reflects that the treating physician’s determination that a service is medically necessary is binding unless contradicted by substantial evidence, and is entitled to some extra weight, even if contradicted by substantial evidence, because the treating physician is inherently more familiar with the patient’s medical condition. Thus, providers should reference the treating physician rule to demonstrate that the treating physician’s medical judgment as to the medical necessity of the services provided should prevail absent substantial contradictory evidence. With reference to radiology providers specifically, it should be noted that the determination whether a radiology service is reasonable and necessary is often initially made by a referring physician that orders radiology services rendered by a radiology provider. This is an important consideration that should be addressed in a discussion of the treating physician rule.
B. Waiver of Liability
Pursuant to the Medicare waiver of liability defense, physicians may be entitled to payment for claims deemed not reasonable and necessary by the carrier during an audit. The statutory authority for waiver of liability is set forth in Section 1879(a) of the Social Security Act. Under waiver of liability, even if a service is determined to be not reasonable and necessary, nonetheless payment may be rendered if the provider did not know and could not reasonably have been expected to know payment would not be made. The relevant inquiry focuses on whether the provider “knew or could have reasonably been expected to know” payment would not be made. Therefore in defending an audit, a physician must have access to all relevant Carrier communications with the provider community and communications with the particular provider. The waiver of liability provisions generally only apply to determinations that a service was not medically necessary. If a radiology service is denied as not reasonable and necessary, one potential argument a radiology provider could make under the theory of wavier of liability is that it did not know, and could not reasonably have been expected to know that payment would not be made on the claim, because the referring physician had specifically determined that the services would be reasonable and necessary for the care of the patient.
C. Provider without Fault
Additionally, the provider without fault defense may be employed in the case of post-payment review denials. The Medicare provider without fault provisions, Section 1870 of the Social Security Act, states that payment will be made to a provider if the provider was without “fault” with regard to billing for and accepting payment for disputed services.
As a general rule, a provider will be considered without fault if it exercised reasonable care in billing for and accepting payment, i.e., the provider complied with all pertinent regulations, made full disclosure of all material facts, and on the basis of the information available, had a reasonable basis for assuming the payment was correct.
“Fault,” for purposes of the provider without fault provision, is defined as follows:
(a) An incorrect statement made by the individual which he knew or should have known to be incorrect; or
(b) Failure to furnish information which he knew or should have known to be material; or
(c) With respect to the overpaid individual only, acceptance of a payment, which he knew or could have been expected to know, was incorrect.
As with waiver of liability, if a radiology service is denied as not reasonable and necessary, one argument a radiology provider could make under the provider without fault doctrine is that it did not know, and could not reasonably have been expected to know that payment would not be made on the claim, because the referring physician had specifically determined that the services would be reasonable and necessary for the care of the patient.
In addition, providers also will be deemed to be without fault in the absence of evidence to the contrary, if the overpayment was discovered subsequent to the third calendar year after the year of payment.
D. Reopening Regulations
Medicare regulations recognize that, in the interest of equity, Medicare providers m
ust be able to rely on coverage determinations. Accordingly, the Medicare regulations place restrictions upon the permissible timeframe for reopening determinations. According to the federal regulations governing the Medicare appeals process, once an initial determination to pay a claim has been made, the claim can be only reopened for review within a certain time period.
Pursuant to 42 C.F.R. § 405.980 (b), a contractor may reopen and revise its initial determination:
1. Within 1 year from the date of the initial determination for any reason;
2. Within 4 years of the date of the initial determination for good cause as defined in 405.986.
3. At any time if there exists reliable evidence as defined in Sec. 405.902 that the initial determination was procured by fraud or similar fault as defined in Sec. 405.902.
4. At anytime if the initial determination is unfavorable, in whole or in part, to the party thereto, but only for the purpose of correcting a clerical error on which that determination was based.
Pursuant to 42 C.F.R. § 405.986, “good cause” may be established when:
1. There is new and material evidence that—
i. Was not available or known at the time of the determination or decision; and
ii. May result in a different conclusion; or
2. The evidence that was considered in making the determination or decision clearly shows on its face that an obvious error was made at the time of the determination or decision.
Further, according to the Medicare Financial Management Manual, “If an overpayment is determined based on a reopening outside of the above parameters, the FI or carrier will not recover the overpayment.”
E. Challenges to Statistics
In many post-payment audits, CMS will audit a small sample of a provider’s records and, if it finds an overpayment, CMS will extrapolate the overpayment to the provider’s entire patient population. The MMA sets limits regarding when statistical extrapolation may be used, and the Medicare manuals establish guidelines for CMS to follow when performing an audit based upon a statistical sample. If an extrapolation is flawed, it may be successfully challenged, bringing the total dollars at issue to the “actual” alleged overpayment, and not the extrapolated alleged overpayment. For example, in one recent case challenged by this law firm, CMS alleged an “actual” overpayment of approximately $ 28,000, which it then extrapolated to render its determination that the provider had been overpaid over $ 1.5 million. This firm was successful challenging the methodology of this statistical extrapolation and the extrapolation was overturned.
Pursuant to Section 935 of the MMA:
(1) LIMITATION ON USE OF EXTRAPOLATION. –A Medicare contractor may not use extrapolation to determine overpayment amounts to be recovered by recoupment, offset, or otherwise, unless the Secretary determines that –
(A) there is a sustained or high level of payment error; or
(B) documented educational intervention has failed to correct the payment error.
CMS also has established guidelines for statistical extrapolations, which are set forth in the Medicare Program Integrity Manual (CMS Pub. 100-08, Chapter 3, §§ 3.10.1 through 3.10.11.2). Notably, the RACs are authorized to use extrapolation, provided that they adhere to the above-referenced statute and Manual provisions. CMS and its contractors must follow these guidelines in conducting statistical extrapolations. If it fails to do so, a Medicare provider may have success challenging the validity of the extrapolation.
VI. CONCLUSION
Radiology providers should be ready for increased Medicare auditing activity as the RAC program expands nationwide. Radiology providers should make efforts now to evaluate their compliance with Medicare policies. Should a provider or supplier be subject to a RAC or other Medicare audit, effective strategies are available that can be successfully employed in the appeals process to defend Medicare audits.
The attorneys of Wachler & Associates, P.C., represent healthcare entities, providers and suppliers nationwide in all areas of healthcare law. Our healthcare attorneys and assistants have incomparable experience in the Recovery Audit Contractor (?RAC?) and Medicare audit appeals process. Our lawyers have successfully represented clients in thousands of Medicare appeals cases nationwide since 1980. http://www.racattorneys.com
Categories: Medicare And Medicaid Tags: Audit, Audits, Contractors, Defending, Medicare, Recovery, Strategies, Successful
Securing a Retirement Income for Life: Strategies for M
Some recent retirement income auctions on eBay:
NEW Retirement Income - Warshawsky, Mark J.
 | US $31.99 End Date: Sunday May-27-2012 12:18:19 PDT Buy It Now for only: US $31.99 Buy it now | Add to watch list |
The Buckets of Money Retirement Solution: The Ultimate Guide to Income for...
 | US $15.05 End Date: Sunday May-27-2012 14:58:44 PDT Buy It Now for only: US $15.05 Buy it now | Add to watch list |
Categories: Retirement Income Tags: Income, Life, Retirement, Securing, Strategies
Double Your Retirement Income: Three Strategies for a S
Most popular retirement income eBay auctions:
Maximize Your Retirement Income: A Guide to Financial D
 | US $16.54 End Date: Thursday May-24-2012 10:25:17 PDT Buy It Now for only: US $16.54 Buy it now | Add to watch list |
202 Ways to Supplement Your Retirement Income by James
 | US $9.95 End Date: Friday May-25-2012 10:27:41 PDT Buy It Now for only: US $9.95 Buy it now | Add to watch list |
Categories: Retirement Income Tags: Double, Income, Retirement, Strategies, Three
Long Term Investing Strategies – A Smart Plan for a Secure Future
Long-term stock market investing is one smart way of keeping your life secured. Never let your retirement change the lifestyle you are accustomed to. Don’t you dream of leading your life the same way …
GoArticles Search for ‘retirement’
Categories: Retirement Articles Tags: Future, Investing, Long, Plan, Secure, Smart, Strategies, Term
