Hospice PEPPER Adds New Flavor to Agency Data Analysis

Hospices now have the opportunity to take a first hand look at what its peers are doing and see how each hospice ranks with payment patterns and quality analysis using CMS’ new release of “PEPPER,” or the hospice “Program for Evaluating Payment Patterns Electronic Report.” Later this month, CMS and its partner TMF Health Quality Institute (TMF), will begin posting free hospice-specific comparative data reports for hospices nationwide, comparing a single hospice’s Medicare billing practices with other hospices in the state, Medicare Administrative Contractor (MAC) jurisdiction and nation. While PEPPER does not identify the presence of improper payments, hospices will want to use the PEPPER to help guide its auditing and monitoring activities.

This tool comes none too soon for hospices, who are falling under more intense scrutiny since being identified as vulnerable to abuse.  Hospices have been encouraged to develop and implement their own compliance programs to help steer clear of fraud and abuse. As part of every compliance program, hospices should be conducting regular audits to ensure that Medicare billing is being done correctly and that the proper documentation is where it should be. And with the release of PEPPER, hospices have another auditing tool at their disposal.

According to TMF, each hospice PEPPER contains claims data statistics (obtained from paid hospice Medicare UB-04 claims) for the most recent three cap years (cap years span from November 1 through October 31 of the following year). The individual hospice is then compared to other hospices in three comparison groups: state, Medicare Administrative Contractor/Fiscal Intermediary jurisdiction and nation. Using these comparisons, a hospice will have the ability to determine whether its results differ from other hospices and whether it is at risk for improper Medicare payments.

PEPPER becomes a valuable tool for hospices by identifying at risk areas for improper Medicare payments, based on preset control limits. TMF has set the upper control limit for all target areas at the national 80th percentile. There are also coding-focused target areas, which have a lower control limit, the national 20th percentile. The hospice PEPPER does not contain any coding-focused target areas; therefore, the hospice PEPPER draws attention to any findings that are at or above the national 80th percentile. CMS has pinpointed live discharges and long lengths of stay as target areas for the hospice PEPPER.

PEPPER is available for hospices and for partial hospitalization programs (PHPs) this year. Short- and long-term acute care inpatient Prospective Payment System (PPS) hospitals, critical access hospitals, inpatient psychiatric facilities and inpatient rehabilitation facilities also have PEPPERs, with the format of the reports and the target areas specifically customized for each setting. The Hospice PEPPER is the version of PEPPER specifically developed for the hospice setting.

The hospice PEPPER will be distributed via hard copy to each hospice, addressed to the CEO and delivered via Fed Ex by the end of the month. A web-based training session on how to use PEPPER will take place on September 13 at 1pm for hospice staff, providing information on PEPPER and how to use it. Hospices may register for the training on the TMF website. Registration is limited, so CMS is encouraging hospices to coordinate internally to prevent duplicate registrations per facility. The training session will also be recorded and then posted on the TMF website in the Hospice “Training and Resources” section.