City of West Palm Beach Internal Auditor s Office

Transcription

1 POST AUDIT REVIEW OF EMERGENCY MEDICAL SERVICES BILLING Report No. PAR18-06 December 17, 2018 City of West Palm Beach Internal Auditor s Office Beverly Mahaso, Chief Internal Auditor, Esq., CIA, CFE Elena Georgiev, Senior Internal Auditor, CPA, CGMA, CIA Ellen Misita, Senior Internal Auditor, CGAP

2 December 17, 2018 Audit Committee City of West Palm Beach 401 Clematis Street West Palm Beach, Florida RE: POST AUDIT REVIEW OF EMERGENCY MEDICAL SERVICES BILLING AUDIT, AUD Dear Audit Committee Members: In FY 2014, the Internal Auditor s Office released the review of the West Palm Beach Fire Rescue Department s (WPBFR) Emergency Medical Services (EMS) Billing function. We performed certain procedures, as enumerated below, with respect to activities of the Finance Administration area of the WPBFR in order to render a conclusion on the status of the recommendations made as a result of that review. This Post Audit Review (PAR) consisted primarily of inquiries of City personnel and examinations of various supporting documentation. It was substantially less in scope than an audit in accordance with generally accepted government auditing standards. The evidence obtained provided a reasonable basis for our conclusions; however, had an audit been performed, other matters might have come to our attention that would have been reported to you and our conclusions may have been modified. The audit contained eleven (11) recommendations that addressed the audit s findings. Based on the post audit review performed, we concluded that recommendations 4, 6, 10, and 11 were implemented, and recommendations 1,2,3,5,7,8, and 9 were partially implemented. We have enclosed a table listing all the recommendations with the current statuses. We found that management made significant efforts to take corrective action. Further, we note that WPBFR is actively continuing to make improvements. As such, additional steps may have been taken to implement the recommendations after the conclusion of this Post Audit Review. We will conduct another Post Audit Review in approximately 6 to 12 months, at which time we will review all additional changes made after the conclusion of this Post Audit Review. 1

3 Recommendations Status with Medium Low - 1 Medium - 1 High - 2 High Implemented Partially Implemented Not Implemented We thank the personnel in the Finance Administration area at WPBFR for their assistance in conducting this review. We also thank the personnel of the City s Finance Department for working with WPBFR on continuing implementation efforts. Respectfully Submitted, /s/ Beverly Mahaso Chief Internal Auditor cc: Paula Ryan, Commission President Kelly Shoaf, Commissioner Cory Neering, Commissioner Keith James, Commissioner Christina Lambert, Commissioner Jeri Muoio, Mayor Jeffrey Green, City Administrator Dorritt Miller, Deputy City Administrator Scott Kelly, Assistant City Administrator Diana Matty, Fire Chief Mark Parks, Chief Financial Officer Dathan Griffiths, Treasury Manager Encl. 2

4 No. 1 High Auditor s Condition and Recommendation Fire Rescue total transports do not agree with the total transports per ADPI. The difference of 2,769 transports (or 23% of total transports) was not billed by ADPI. We recommend that the City perform necessary monitoring to ensure all transports are received and billed by ADPI. We recommend the City, on a monthly basis, review and reconcile all transports recorded in the Fire Rescue Department to ADPI s system. We further recommend that City staff utilize ADPI s reports to assist with monitoring as well. AUDIT RECOMMENDATIONS Management s Response finding. On December 8, 2014, WPBFR accepted full responsibilities of oversight of the EMS billing function from the Finance Department. Processes are now in place to verify that ADPI receives and bills all eligible transports. Management s Status Update On a monthly basis, a Code 3 (WPBFR) report is exported to an Excel spreadsheet for all billable transports. At the same time, the monthly billed transports (ADPI) are exported to an Excel spreadsheet and combined with the Code 3 spreadsheet. Every transport is reconciled to a billed account to verify all transports have been billed. Auditor's Note: WPBFR IT staff is trying to work with IT to provide a server to perform an automatic reconciliation for this process as both SafetyPad and ADPI have Application Program Interfaces that should communicate with one another and flag all mismatches. 3

5 2 High We found discrepancies between final record counts sent to Penn Credit by ADPI. These discrepancies were related to records that should have been sent to collections. We recommend additional efforts be made by Penn Credit, ADPI, and the City to ensure that all records are received by Penn Credit. ADPI and the City should receive a confirmation report after records are imported into Penn Credit s system verifying the number of records submitted. We additionally recommend that ADPI provide Fire Rescue Management with documentation to support the number of records provided to Penn Credit, and demonstrate their review of the transmittals for completeness. finding. WPBFR will coordinate with ADPI and Penn Credit to be notified of the date and number of records exported from ADPI and the date and number of records imported by Penn Credit. WPBFR will also request access to or confirmation of these transmissions by date and number of records. WPBFR started receiving confirmations from both ADPI and Penn Credit; however there has been an issue lately and WPBFR has been in contact with ADPI. Management Update (Finance): The Finance Department has been working with both ADPI and Penn Credit to confirm and consolidate collections. This is still a work-inprogress. 4

6 3 Medium When testing high mileage transports to ensure the accuracy of the transport mileage, we pulled a sample of 11 records to test the accuracy of these high mileage transports and found that all of the selected sample transports mileages were inaccurate when compared to mapquest.com. finding. On December 8, 2014, WPBFR accepted full responsibilities of oversight of the EMS billing function from the Finance Department. Processes are now in place to monitor the mileage submitted for each transport and to identify and correct any that appear to be overstated. WPBFR is using a report written in Access to extract any mileage over 20 miles from Code 3. Those transports over 20 miles are then researched and updated as necessary. The few identified over 20 miles were already corrected by ADPI. 4 High We recommend that Fire Rescue perform periodic monitoring of ADPI records to ensure data accuracy. Additionally, we recommend ADPI review its current trip data validation methods to strengthen its mileage accuracy validation process. Based on our understanding of the billing process, we believe ADPI should receive the EMS transport data in less than 15 days from the date of service. For testing purposes, we finding. WPBFR does agree that the effect of untimely uploads may cause delays in billing and the necessity to monitor the billing process, however, our records indicate the timeliness of data uploads Periodically, reports are exported to Excel from ADPI's database; the transport dates are verified to the creation date to determine the number 5

7 consider transport data that took longer than 15 days for ADPI to upload into their system as being untimely. Based on the data received by ADPI, 16% of the FY 2013 data took longer than 15 days to be uploaded in ADPI s database with an account creation date. to ADPI s secure portal to be 100% within 12 days. The delay appears to be the transfer of data from ADPI s server to their internal billing system. WPBFR will work with ADPI to ensure the transport data is processed in a timely manner. of days to create. There are some issues on this matter as the individual who transmits the transports doesn t have a backup when out of the office, therefore, delaying transmission. 5 Medium We recommend that the Fire Rescue Department work closely with ADPI to ensure the transport data is received in a timely manner. We also recommend that periodic monitoring be performed to further ensure timeliness. Monitoring should always be conducted to ensure transport data timeliness, accuracy, and completeness. In FY2013, delinquent EMS bills were not sent timely to Penn credit. It took an average of 467 days from the date of service for Penn credit to finding. The timeliness issue is confusing since the agreements between the City and ADPI, and the City and Penn Credit conflict with each other. The ADPI agreement The Penn Credit agreement was extended and WPBFR requested the change to match what ADPI's 6

8 receive the patient s information. We recommend management communicate to ADPI the collection criteria stipulated in Penn Credits agreement with the City to address the timeliness of providing transport data to Penn Credit. Additionally, we recommend management review performance periodically to ensure delinquent accounts are provided to Penn Credit within the agreed upon time frame. We also recommend that management request ADPI provide monthly reports indicating the number of records received without billing addresses that ADPI was able to successfully bill. Depending on the outcome of that review, we recommend management consider investing in staff training to obtain needed addresses for billing and consider providing Penn Credit with only the transports for states to turn over accounts for which no collection has been made after 12 months and the Penn Credit agreement states delinquent EMS bills will be sent to Penn Credit at more than 90 days past due. WPBFR will recommend an amendment to the Penn Credit agreement to bring it in line with the terms of the ADPI agreement. agreement states but no changes were made to the Penn agreement. We are looking into changing Penn Credits agreement Sect d. from 90 to 365 days. Auditor's Note: The current contract expires in March WPBFR will continue to work with Finance on an appropriate change to the collection agreement to reflect the unique aspects of EMS collections. 7

9 which the staff are unable to locate a billing address. 6 Medium ADPI data did not include the correct rate of $340 for Death on Arrival (DOA) incidents. Many DOA incidents were not uploaded for billing into ADPI s system. During FY 2013, an estimated 151 DOA incidents were not billed by ADPI. Prior to using ADPI services, the City billed for DOA incidents as stipulated in Resolution No However, since ADPI took over billing services, many of the DOA incidents have not been billed. Additionally, we were informed that Medicare pays for DOA incidents when proper rules are followed. finding. The City s comprehensive fee schedule was provided to ADPI on 01/16/15 and the billing for eligible DOA s has resumed. Processes are in place to ensure the correct rate is being charged. ADPI is now billing for deceased patients. 8

10 7 Medium We recommend the City provide greater oversight in ensuring the correct rate is charged for transport service provided. We recommend management communicate the fees established in Resolution No to the billing vendor. Additionally, we recommend that DOA incident billing be resumed. The City does not practice ongoing monitoring to ensure that ADPI: Receives and bills every patient transport; Generates bills timely; Prepares accurate bills; Properly credits patient s accounts; Follows-up on past due or underpaid accounts; Investigates undeliverable bills; Provides HIPAA Privacy Notices with initial bills; Charges the City accurately. We recognize that the Finance Department has experienced a reduction in personnel Finance agrees with the finding. The Finance Department will work in conjunction with the Fire- Rescue Department to implement monitoring controls and procedures over the performance of ADPI. WPBFR monitors that all transports are billed; monitors the timeliness and accuracy of billing; reviews payment postings periodically to ensure proper credits to patient's accounts; reviews if HIPAA notices are provided with 1st billing and reviews the ADPI invoices submitted for payment. Auditor's Note: Although WPBFR has informal notes for their processes, a formalized system of controls and procedures for the billing vendor has not been 9

11 responsible for the monitoring responsibilities addressed in this report. However, due to lack of documentation, we were unable to test whether monitoring actions were performed. Furthermore, the large workload of the responsible personnel provided additional reservation that all necessary monitoring was being completed. implemented due to staffing issues. 8 Medium We recommend the Finance Department, in conjunction with the Fire Rescue Department, implement monitoring controls and procedures over the performance of ADPI. We found that the department was not consistently offering payment plans. We recommend that the City discuss with ADPI the Finance agrees with the finding. The Finance Department in conjunction with the WPBFR department will talk to the vendor to determine the best approaches to offering payment plans that will increase collection success. WPBFR has a number of selfpayors that are paying their outstanding bills on an installment plan. However, there remain a significant number of users of the system that do not have either insurance or identifiable resources to institute a 10

12 9 Medium possibility of implementing a more customized collection effort (per payer type) that promotes the enrollment in payment plans. We also recommend that the option of a monthly payment plan be added to all invoices for transport services. The Finance Department and the Fire Rescue Department have not established clear SOPs outlining what tasks are to be performed, how, and by whom. The Finance Department and the Fire Rescue Department were not aware of what monitoring tasks were being performed or by whom. ADPI was not provided with a write-off policy that agrees with Penn Credit s contract. Transport fees established per City resolution were not always honored or clearly communicated. finding. WPBFR will establish written procedures for the monitoring function of EMS billing and will coordinate with the Finance Department during this process. payment plan. We will continue to work with Finance to establish a viable solution. WPBFR has an informal set of processes that outlines the billing process. However, staff limitations have precluded the development of formalized Policies and Procedures. Improvements have been made to the SafetyPad software to aid in proper billing for Worker's Compensation and describe patient transfer techniques. 11

13 10 Low We recommend that the Fire Rescue Department establish well-written SOPs for the EMS Billing Monitoring function. Well-written SOPs facilitate training and cross-training by providing step-by-step instructions and serving as a reference, resource or guide for staff. Employees can teach and support one another if they have documentation available that describes exactly how a task should be done. We recommend that the Fire Rescue Department collaborate and communicate with the Finance Department when developing the SOPs to ensure that there is a clear understanding of roles and responsibilities. The EMS billing process is not following the directive of the City Commission established in the Emergency Medical Service fee resolution, regarding the assessment of late fees. finding. WPBFR will take the necessary corrective action. This recommendation was reviewed, and a decision was made to eliminate the late 12

14 11 High We recommend that the City direct ADPI to follow the directive of the City Commission approved resolution and implement charging and collecting late fees for past due accounts. With the exception of the enterprise funds (utilities etc.) which are written-off monthly, the general fund has not written off uncollectible balances since We recommend that the Finance Department perform periodic write-offs of accounts that are uncollectible, in order to more clearly represent the financial position of the City. Finance agrees with the finding. The process for writing-off balances has been implemented. We receive an end of month report from ADPI every month. Part of the report is a summary of changes to the Accounts Payable from the last month-end to the current month-end. It includes the amount billed for the month as well as refunds, adjustments, and write-offs. For months in which accounts have been sent to the collection agency, there is a line captioned, "sent to collections" and a total amount deducted from the beginning AR balance. The last line of the report is the month-end total. The City adjusts its year-end accounts receivable balance to the ADPI fees for past due accounts in FY18. Management Update (Finance): The Finance Department wrote-off $13.7 million of legacy EMS receivables in FY The Finance Department is currently computing an annual collection rate. The allowance for doubtful accounts is calculated based on this rate and an allowance is recorded thus providing a more accurate picture of the receivable balance. 13

15 ending Accounts Receivable balance. In doing so, we write off the balances sent to the collection agency. 14