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Did You Forget About PEPPER?

Posted by Margaret Scavotto, JD, CHC on 8/11/15 2:00 PM

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PEPPER (Program for Evaluating Payment Patterns Electronic Report) reports were released for nursing homes and other providers in April 2015 (and are coming soon for home health in July). Last year, only half of nursing homes had accessed their reports three months after the release date.

A Missed Opportunity

That's too bad, because PEPPER is a powerful compliance tool that tells providers how the government sees them.

This report compares your SNF's Medicare Part A claims data to state, national and MAC or FI jurisdiction data. This report includes this comparative data for six Target Areas: 1) Therapy RUGs with high ADLs; 2) Nontherapy RUGs with high ADLs; 3) Change of therapy assessments; 4) Ultrahigh therapy RUGs; 5) Therapy RUGs; and 6) 90+ day episodes of care.

With PEPPER reports, the government processes providers' claims data for them and tells them if they are seen as high-risk. This report is a gift to providers and should be the first place we start when planning a compliance audit strategy.

What You Can Do

  • Get online. If you haven't already, log on to and retrieve your report. See if your report identifies you as an outlier (if you are at or above the 80th percentile, or in some cases at or below the 20th percentile) in any target areas.
  • Audit. If your report shows you are an outlier, an internal audit should be conducted to identify any improper payments or non-compliant practices. CMS is quick to point out that variances from the national data do not necessarily mean billing irregularities have occurred. However, it would be wise to know whether there is a reason why the government has identified you as an outlier.
  • Don't wait. PEPPER comes once a year, but our attention to it should be ongoing. Don't wait for the report to be released in April. Work with your billing department to see what reports you can run so that you can track the Target Areas as part of your compliance efforts, at least quarterly. This way, there will be no surprises in April 2016, and you can address any improper payments as they arise.

Are you an outlier? Download  MPA's Guide to  PEPPER Reports  to find out



Topics: PEPPER, Auditing and Monitoring

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