Health Canada/Canadian Assisted Devices Association

Working Group

Update on Medical Supplies and Equipment (MS&E)Audit Program

March 26, 2012Toronto, On

• Overview of NIHB Program

• Audit Program

• Current Context and Emerging Issues

PRESENTATION OBJECTIVES

HELL….

The talks have begun, but there is no sign NIHB audit woes will abate soon.

Another Random

Audit….they never stop! AND the

rules keep changing!!

NIHB PROGRAM

• Program is publicly funded and as such is accountable for those public funds.

• The NIHB Program is not an insurance carrier. We differ from private insurance plans in a number of ways:

- Needs based approach

- No co-payments

- No deductibles

- No annual maximum

NIHB PROGRAM PRESSURES

• Financial • Political• Media• Provincial and Territorial Governments• Stakeholders,

• Professional Associations,• Retail and Corporate Medical Industry Organizations• Pharmaceutical Industry• Medical Lobbyists

• First Nations and Inuit Clients and their Rep Orgs

• The NIHB client population was 846,024 as of March 31, 2011 soon to be about 900,000

• A total of 20,197,466 pharmacy, MS&E and dental claims lines were settled through the HICPS system in 2010/11.

• As of March 31, 2011, 25,710 active providers were registered with the HICPS claims processor to deliver NIHB Pharmacy, MS&E and Dental benefits.

Program Overview

NIHB Benefit2010/11 Expenditures

($ Millions)% of Total NIHB Expenditures

Pharmacy (including MS&E) $440.8 42.9%Medical Transportation $311.8 30.3%Dental $215.8 21.0%Vision Care $29.2 2.8%Premiums $18.4 1.8%Other Health Care $12.1 1.2%Total NIHB Expenditures $1,028.1 100%

Source: FIRMS adapted by Program Analysis Division

Program Expenditures

• A total of 50,462 clients received MS&E benefits in 2010/11.

• During 2010/11, 309,874 MS&E claim lines were processed through HICPS.

• In 2010/11, 3,219 providers submitted claims for MS&E.

• In 2010/11, expenditures for MS&E paid through HICPS totalled $27.5 million or 6.3% of all NIHB Pharmacy costs. • The Alberta Region (20.5%) and Saskatchewan Region

(17.3%) had the highest proportions of MS&E costs.

Medical Supplies & Equipment Overview

NIHB Medical Supplies, 2010/11

Expenditures for Hearing Aids totalled $4.2 million, followed by Wheelchairs and Accessories at $2.9 million, and Custom Made Footwear at $2.4 million

Why does Health Canada have an Audit Program?

NIHB RISK MANAGEMENT INITIATIVE

• Financial Administration Act (FAA) is the key legislation for Federal Government Departments to ensure that public funds are distributed appropriately

• Following recommendations from the Auditor General, Public Accounts Committee and independent consultants, the NIHB Program implemented a Risk Management Framework and a Risk Management Committee

• Goal of the initiative is to reduce financial risk to the Crown through diligent oversight of expenditures of public funds.

PROVIDER AUDIT PROGRAM

Scope: • The Pharmacy Provider Audit Program is administrative in

nature and is aimed at detection, prevention and settlement of inappropriate billing practices.

Objectives:• Prevent and detect inappropriate billing practices

• Validate active licensure of registered providers

• Confirm paid services were received by eligible NIHB program clients

• Ensure that providers have retained appropriate documentation to support submitted claims

PROVIDER AUDIT COMPONENTS

• Next Day Claims Verification Program• Client Confirmation Program • Provider Profiling Program• On-Site Audit Program• Desk Audit Program

NIHB Medical Supply and Equipment Audit Program

As a MS&E service provider you should be familiar with the following important information:

• The Provider Guide for MS&E Benefits• The Provider Claims Submission Kit• http://www.provider.esicanada.ca/

The above information provides you with the Terms and Conditions of the Program including policies and claim submission requirements.

What do you need to know to bill the Program?

• PA’s currently approved by HC regional offices.

• PAs approve the benefit to be provided and not the cost of the item.

• Cost on PAs should be the lesser of the Actual Acquisition Cost (AAC) plus applicable regional mark-up or regular retail price.

Prior Approvals (PAs)

Core elements for claim submission are as follows:

A valid prescription (Rx). • must be signed by an NIHB recognised

prescriber for the service being rendered• Include patient name, date• Rx should itemise the requested services to

be rendered• E.g; bandages, what type? size? Etc

A complete client chart/record which includes:• Internal Invoice supporting all financial

transactions• Actual Acquisition cost of items should be

made available if not in client file• Proof of NIHB Program client receipt• Chart notes in support of all professional

assessments• Copy of prior approval

Inappropriate Billing Practices

• Charging maximum rate in lieu of actual acquisition cost plus applicable mark-up

• False claims• Billing for items requiring a prior approval (PA) that

were not submitted to the FNIH Regional Office for review and approval

• Offering incentives in return for NIHB claims• Charging “bonus sizes” to the Program instead of

original pack size• Billing non benefits under codes which are covered

•Over the last 5 years, the NIHB Program has conducted 56 onsite audits of MS&E providers nationally•Recoveries for this time period amounted to $258,194

MS&E Audit ProgramCurrent Observations

Changes to NIHB Program (MS&E)

• Currently a moratorium on audits of the following:• custom-made products• Mobility & Equipment items

• Pricing Certainty • The Program is moving towards defined price files for claims

adjudication. Eliminating the need for most pricing audits• Replace PA with Special Authorization cut the frequency of

interaction 1/24 months from 8/24 months

Questions?

Non-Insured Health Benefits

For more information regarding the Non-Insured Health Benefits Program please visit the Health Canada’s First Nations and Inuit Health Branch website.

http://www.hc-sc.gc.ca/fniah-spnia/nihb-ssna/index-eng.php