The Reality of Zero-Payment RAPs


Billing and revenue exchange is one of the biggest issues for home health agencies across the nation. Agencies without proper billing practices are facing challenges of delayed payments right now. Agencies must expertly examine and fine tune their auditing and billing policies to ensure that their Requests for Anticipated Payment (RAPs) and final claims are billed within Medicare’s timelines, or they face devastating financial consequences.

Palmetto GBA (Government Benefits Administration) outlines the timelines and regulations that agencies need to follow to ensure compliance with timely billing for Medicare claims.

For the agencies that don’t adhere to these time limits and filing guidelines, the possibility of getting zero percent payments on RAPs is a real threat.

The home health industry has been warned for years that CMS is paying close attention to timely filing guidelines, and that agencies could be penalized in the future for excessive RAP cancellations. Palmetto GBA and MACs (Medicare Administrative Contractors) routinely examine data on RAPs and final submissions to determine the percentage of cancelled RAPs.

Since CMS has the authority to revoke a provider’s privilege to receive payment on a RAP, agencies who have excessive numbers of cancellations face the reality of no longer having the privilege of being paid in advance of care delivery to their Medicare beneficiaries.

Agencies who are at risk of having RAPs suppressed will receive notification before their RAP payment becomes zero percent, in an effort to induce improvement. If improvement is not noted within a reasonable amount of time, their RAP payments will be suppressed

Once this happens, agencies will have to jump through several hoops to bring them into compliance with CMS regulations—but the hoops are not guaranteed to immediately reinstate their RAP privileges.

Agencies on the zero payment RAP list will have to submit a Corrective Action Plan (CAP) containing:

  • Statement of the problem or weakness that caused the delay in timely filing of final bills
  • Proposed solutions to the stated problem(s)
  • Who is responsible for monitoring the problem(s)
  • Any other important information that is helpful

The agency will then undergo a three-month review period, which may be extended until the agency can demonstrate significant reduction in cancelled RAPs.

With proper billing practices, zero-payment RAPs can all be avoided. Our next blog will teach agencies what steps to take to remain compliant and ensure full, timely payments.

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