Kusserow’s Corner: CMS Moves to Extend Moratoria on Enrollment for Home Health and Ambulance Suppliers

Over the last year, I have been reporting on a large number of enforcement actions by the DOJ led Medicare Strike Force in eight target cities. A disproportionate number of cases involved home health agencies and ambulance services that many consider to be among the most vulnerable to fraud in health care. In July 2013, CMS made initial use of authority under the Affordable Care Act to use temporary enrollment moratoria to prevent fraud where they have found that fraud trends warranted a moratorium on home health providers and ambulance suppliers in certain geographic areas. They have now announced a second wave of enrollment moratoria to fight fraud and safeguard taxpayer dollars, while ensuring patient access to care is not interrupted. In making the decision, CMS, in consultation with the HHS Office of Inspector General (OIG), reviewed key factors of potential fraud risk including a disproportionate number of providers and suppliers relative to beneficiaries, and extremely high utilization. All the geographic areas named in the moratoria ranked high in these fraud risk factors.

The Federal Register notice relating to this decision by CMS can be found at: https://www.federalregister.gov/public-inspection\

The new moratoria include enrollment of home health agencies in four metropolitan areas (Fort Lauderdale, Detroit, Dallas, and Houston). These are four of the eight cities with Medicare Strike Forces. In addition, CMS has also issued a moratoria on enrollment of new ground ambulance suppliers in the Greater Philadelphia area. The current enrollment moratoria of home health agencies in Chicago and Miami, and for Houston area ground ambulance supplier enrollments, have been extended for six months.

The programs affected by the CMS decision are those that allow the Medicaid recipient to control the selection and payment of personal care attendants. The OIG released a report in 2012 that stated Medicaid costs for personal care services in 2011 totaled $12.7 billion, a 35 percent increase since 2005. Home personal care is one of the fastest growing job categories in the country. However, the OIG’s report points to numerous problems in Medicaid personal care services that leave it vulnerable to improper payments, abuse, and fraud, including lack of training standards, uneven oversight of services provided, and failure to implement prepayment controls to prevent improper or fraudulent payments.

In the areas where the moratoria are in effect, existing providers and suppliers can continue to deliver and bill for services, but no new provider and supplier applications will be approved. If anyone has doubt about the seriousness of the problem with which CMS, the Department of Justice (DOJ), and the OIG have been dealing, the following are some of the significant cases that have come to light just in January of this year.

  • In Brooklyn, N.Y., a guilty plea in connection with a $13 million health care fraud and money laundering scheme.
  • In Detroit, a home health agency owner who participated in a Medicare fraud scheme that totaled almost $11 million was sentenced to serve 120 months in prison, three years of supervised release and was ordered to pay more than $10 million in restitution, jointly and severally with his co-defendants.
  • In Texas, an operator, owner, and director of nursing of a home health agency were arrested in connection with a Medicare fraud scheme.
  • In Los Angeles, an individual worked in the health care industry pleaded guilty to a scheme that submitted nearly $25 million in fraudulent bills to Medicare for services and supplies, including power wheelchairs and diagnostic tests that were medically unnecessary and sometimes were never provided.
  • In Philadelphia, an individual was charged with Health Care Fraud and aiding and abetting health care fraud relating to transporting patients by ambulance when those patients could have been transported safely by other mean.
  • In Miami, several patient recruiters, including a home health care company owner, pleaded guilty to health care fraud.

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More information on the various home health schemes can be found in past blog articles on this subject, chronicling the movement toward CMS’s use of this powerful new authority:

  1. $14 MILLION HOME HEALTH AGENCY FRAUD
  2. $74 MILLION HOME HEALTH FRAUD CASE IN MIAMI
  3. MORE HOME HEALTH FRAUD CASES
  4. SEPTEMBER CONTINUES TO BE A BANNER MONTH FOR PROSECUTION OF HOME HEALTH FRAUD CASES
  5. INCREASED SCRUTINY AND ENFORCEMENT OF HOME HEALTH FRAUD CONTINUES
  6. CONTINUED CRACKDOWN IN MIAMI ON HOME HEALTH RECRUITER KICKBACKS
  7. MORE RECRUITER KICKBACK CASES
  8. FEDS CONTINUE TARGETING HOME HEALTH FRAUD
  9. ANOTHER HOME HEALTH AGENCY FRAUD SCHEME
  10. UPDATE ON HOME HEALTH AGENCY FRAUD
  11. HOME SERVICES PROGRAM FRAUD CRACKDOWN

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2014 Strategic Management Services, LLC. Published with permission.