So what about the past three years of Medicaid payments?
Virginia providers seek retroactive payments from harm caused by Downcoding Provision
Since July 1, 2020, whenever a Virginia emergency physician saw a Medicaid patient with one of 800 common ER diagnoses, the chart was automatically downcoded to a Level 1 visit, and the physician was paid only $15.45.
For three years, VACEP fought for its members in the legislature and in the courts against Medicaid managed care organizations (MCOs), the Virginia Department of Medicare and Medicaid Services (DMAS), and the Centers for Medicare and Medicaid Services (CMS), attempting to remove this misguided state budget amendment that was approved by CMS.
After an April 26 court ruling saying the policy was not in accordance with federal law, DMAS and the MCOs had to immediately stop downcoding the ER claims.
downcoding 101
Get the deeper background on this article on our Downcoding 101 page.
Since then, the state agency in charge of Medicaid as well as Medicaid MCOs have been making software system changes and, once complete, will automatically reimburse providers at the full Medicaid rates for claims submitted after April 27, the day the federal ruling went into effect.
That’s more than two months of claims. But the Downcoding Provision went into effect in July 2020 — over three years ago, resulting in millions of dollars in reduced payments to emergency physicians.
Now, VACEP, the Virginia Hospital & Healthcare Association (VHHA), and the Medical Society of Virginia (MSV) are asking the Virginia Department of Medicare and Medicaid Services (DMAS) to provide an accounting of the total amount downloaded since July 1, 2020 and to provide us with a plan for how they will pay back the money that is owed to physicians and hospitals.
“Correspondingly, we are requesting that DMAS immediately develop a process and timeline to provide repayment of these payment reduction amounts by affected providers,” the letter states. It was signed by VACEP president Todd Parker, MD, FACEP as well as VHHA president and CEO Sean T. Connaughton and Harry Gewanter, MD, president of the Medical Society of Virginia.
The Downcoding Provision was a Virginia budget amendment sold to legislators by Medicaid MCOs as a cost-saving measure that would reduce "avoidable" ER visits by Medicaid patients. But the list of diagnosis codes was used to penalize emergency departments while doing nothing to aid patients. A federal judge in Richmond recognized that emergency physicians cannot control who visits an ER and have a duty under the federal Emergency Medical Treatment and Labor Act (EMTALA) to see and treat all patients regardless of ability to pay.
“While we appreciate this directive, we do not believe these actions ensure full compliance with the court’s order.”
View or download the joint letter from VACEP, VHHA, and MSV.
Retroactive reimbursement would result in hundreds of thousands of dollars, even millions of dollars, being reimbursed to emergency medicine groups across the state.
“The Downcoding Provision has caused direct financial hardship and irreparable harm to hospitals and physicians,” the letter states. “This is particularly troubling considering the Downcoding Provision was applied in the midst of the COVID-19 pandemic. Emergency departments were on the front lines treating patients at a time when the public was encouraged to seek care if they suspected themselves of having COVID-19 and due to shutdowns and stay-at-home orders, emergency departments were most often the only option for seeking needed care.”
The letter is the latest in a line of moves attempting to remove the law and claw back payments from DMAS.
In every General Assembly since the law went into effect, VACEP, VHHA, and MSV advocated for the removal of the Downcoding Provision. The groups’ members submitted public comment in opposition to the provision, to which DMAS received 194 comments expressing opposition. And representatives submitted comprehensive letters to CMS and held conference calls with agency representatives expressing concerns with the policy.
The federal lawsuit against DMAS was filed in August 2020, a month after the law went into effect.
This month’s letter is the next step after the lawsuit to ensure the court ruling is followed, the language is removed from the budget, and DMAS and the state provide a plan for how back payments will be made.
