From pacemakers to joint replacements, hospitals go through a significant amount of implants in the course of normal business. However, when these implants become explants due to defects or other issues, they can become a liability for the hospital’s Medicare compliance. Let’s break down explant monitoring and why it’s an issue no hospital should overlook.
Pacemakers and other implants may need to be removed for several different causes, some of which may be covered under the device’s warranty. If so, the manufacturer will issue a credit to the hospital. In 2007, however, Medicare and Medicaid noticed that hospitals were receiving these credits on devices covered by Medicare, but weren’t passing the credits back to them.
Explant monitoring refers to the practice of keeping tabs on implants sent back to the manufacturers as well as any credits issued under their warranties. If the hospital receives credit for, they are obligated to report that credit back to Medicare. If the hospital receives credit of 50% or more of the cost of the new replacement device, the hospital must report it to Medicare.
If your hospital doesn’t report those credits back to Medicare, it could trigger a Medicare audit. This audit won’t be limited to explant reimbursements and could uncover deeper issues in your operations.
Your system could also be fined a penalty for not reimbursing Medicare. Medicare often fines per instance, meaning not reporting credits for just a few devices could result in hundreds of thousands of dollars of fines. That’s a major blow to your system’s cash flow and could greatly impact your long-term investments in staffing and technology.
Your patient financial services department is ultimately responsible for monitoring explant inventory and any credits issued. However, this is rarely as simple as it seems. Managing product and warranty information for multiple items from multiple manufacturers creates a number of challenges.
For example, a patient may have had an implant in one hospital, but it was replaced in another. These situations are more challenging to monitor than a simple returned item and many financial departments simply don’t have the time or expertise to accurately report on them.
Our team of healthcare auditing professionals work directly with hospitals and vendors to manage their explants and ensure compliance with Medicare policies. First, we will request a monthly report from patient financial services showing cardiology implants the hospital has placed in patients, including part numbers, serial numbers and any credits issued on that device. Then, we cross-reference that information with what the vendor has on file. This comprehensive approach reduces our clients’ regulatory risk and improves their operating margins.
Over the years, our expert team has helped countless health systems improve cash flow, simplify processes and drive accountability throughout their organization. We know we can help your system, too. Our highly detailed compliance procedures ensure your organization ensure your organization keeps up with the latest regulations and maximizes every reimbursement opportunity.