Kusserow’s Corner: Increased Challenges for Home Health Agencies

Home health care continues to be receive increased regulatory and enforcement attention by the Department of Justice (DOJ), HHS Office of Inspector General (OIG), CMS, and state Medicaid Fraud units. Judith Fox, JD reported at her presentation on Medicaid Enforcement at the HCCA in San Diego that most of the cases involved services billed but not performed; billing for services to hospitalized or deceased patients; use of improperly qualified staff; billing for services provided by family members; falsifying data in claims submission; services provided by exclude parties; and kickbacks to physicians, recruiters, or individuals to pose as qualified beneficiaries.  She further noted that over 40 percent of state Medicaid Fraud unit cases reported are against fraudulent activities of home health agencies; and that it is a leading number of cases investigated by the DOJ Medicare Strike Force.  This heightened enforcement environment has created a real challenge for those who are diligently trying to provide the needed services to home bound beneficiaries according to all the regulatory and legal requirements.

Most enforcement actions have been directed at relatively small home health agencies; however, recently there has been a number of larger providers of home health services have been targeted. The cases generally involve kickbacks and false claims.  I recently reported that Amedisys, a Louisiana-based home health agency and its affiliates, agreed to pay $150 million to the federal government to resolve allegations that it had violated the False Claims Act by submitting false home health care billings to the Medicare program for ineligible patients, furnished nursing and therapy services that were medically unnecessary, and provided services to patients who were not homebound, or otherwise misrepresented patients’ conditions.   Other allegations involved kickbacks to induce the flow of business.  The DOJ followed this action with a 13 count indictment against Continuum Healthcare Executives and 8 others alleging a conspiracy to pay kickbacks to several area personal care home owners and patient advocates, resulting in billing Medicare and Medicaid for mental health services which were unnecessary, and, in some cases, not even provided.

Not only has there been enhanced enforcement, but CMS has taken the unusual step, previously reported here, to establish moratoria on new home health agencies in areas of high fraud and abuse.  The latest news regarding fraud and abuse in the home health care sector was contained in a report issued by the OIG that noted that the Patient Protection and Affordable Care Act (ACA) requires that physicians (or certain practitioners working with them) who certify beneficiaries as eligible for Medicare home health services must document-as a condition of payment for home health services- that a face-to-face encounter with a  beneficiary occurred. Their study was designed to (1) determine the extent to which physicians who certified home health care documented the face-to-face encounter, (2) documented the face-to-face encounter, and (3) assess CMS’s oversight of the face-to-face requirement.  Their study included:

  • 644 face-to-face encounter documents to analyze the extent documents confirmed the reported encounters and contained the required elements
  • Interview of the four Home Health and Hospice Medicare Administrative Contractors (HH MACs) to determine how they ensure that home health agencies meet the face-to-face encounter requirement
  • Review of guidance documents and policies from CMS or the MACs about the face-to-face requirement.

The OIG finding included:

  1. One third of the home health claims documentation of the face-to-face encounter did not meet Medicare requirements
  2. Potentially $2 billion inappropriate payments
  3. Physicians inconsistently completed the narrative portion of the face-to-face documentation
  4. CMS oversight of the face-to-face requirement is minimal.

OIG recommended that CMS (1) consider developing and requiring use of a standardized form to ensure that physicians include all elements required for the face-to-face documentation, (2) develop a specific strategy to communicate directly with physicians about the face-to-face requirement, and (3) develop other oversight mechanisms for the face-to-face requirement. CMS concurred with all of the recommendations.

Tom Herrmann, who had over 20 years experience with the OIG Office of General Counsel and serviced for six years on  the HHS Medicare Appeals Council, observed that “this report highlights the challenges faced by home health agencies in that  all submitted Medicare claims that do not have the requisite documentation of a physician’s face-to-face encounter with a patient could be considered to be false or fraudulent.  Agencies rely upon the ordering physician to accurately and fully document his/her face-to-face encounter with the patient and assessment of needs for HH care.  The agencies have no authority to force a physician to comply on a timely and complete basis with the “face-to-face” requirement. In part the problem stems from CMS’ failure to establish a form and process to ensure that the initiating physician provides sufficient documentation to support subsequent home health care services. Home health agencies have little control over the the physician’s gatekeeper responsibilities but bear potential liabilities.”

In the current enforcement environment, Herrmann also suggests that home health agencies take seriously the need to develop and maintain an effective compliance program.  Currently, agencies most have not invested the time and energy in creating such a program.  However, the ACA has mandated such that health care organizations have such a program as a requirement to enroll in and participate int he Medicare and Medicaid programs.   Herrmann advised “that it would be a mistake for home health agencies to wait for the CMS compliance program regulations.  They should move now using existing compliance guidance issued by the OIG.”

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.