Home Health Reimbursement
Medicare beneficiaries who are generally confined to their homes are eligible to receive certain medical services at home. Home health provides treatment for an illness or injury and helps beneficiaries regain their independence and become as self-sufficient as possible.
Home Health Agencies (HHAs) are paid a predetermined rate for each 60-day episode of home health care. The severity of a patient’s condition changes the number and type of visits required for care. Patients receiving five or more visits are assigned to one of 80 home health resource groups (HHRGs). Group assignments are based on diagnosis, functional capacity and service use, from relatively uncomplicated patients to patients with severe medical conditions.
Medicare will pay for a beneficiary to receive home health services if his or her physician certifies that the beneficiary is “homebound.” Homebound status should be confined to those beneficiaries who are:
- confined to the home (or ALF), except for infrequent or short absences or trips for medical care; and
- requiring one or more of the following qualifying services:
- physical therapy;
- speech-language pathology;
- intermittent skilled nursing.
Medicare pays for covered Medicare Part A and Part B services based on a prospective payment system (“PPS”). Payment for home health services is based on an HHRG value that translates into an episodic rate. A patient’s level of care, including his or her therapy needs, is assessed by the provider by using a form known as an Outcome Assessment Information Set (“OASIS”). Elements of OASIS contribute to a score that the HHAs use to assign the individual to a Home Health Resource Group (HHRG). The HHRGs reflect beneficiaries’ health conditions and their needs for care in three distinct areas: clinical severity, functional severity, and service utilization. The HHA assigns the beneficiary to a Health Insurance Prospective Payment System (HIPPS) code that is based on the HHRG level. CMS also uses a case-mix model that differentiates payment based on whether the beneficiary is in an early episode (i.e., a first or second episode) or a late episode (i.e., third episode and beyond), as well as whether the beneficiary has received more than 20 therapy visits.
For Medicare beneficiaries receiving skilled care under their home health benefit, personal care such as bathing, feeding, and assistance with medications are also covered by Medicare. These services are included in the billing for a given home health episode and, therefore, should not be billed additionally or separately.
Home health services must be provided under a plan of care, established and reviewed by a physician. Physician involvement, review, and signature on a plan of care are the conditions of payment for home health services. The beneficiary’s signature is also required before he or she is given “homebound” status. Furthermore, to qualify for Medicare payment, the provider must ensure that any home health or inpatient therapy services given are (a) medically necessary; (b) properly documented; and (c) properly authorized by a physician. Specifically, the services must be “reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.” 42 U.S.C. § 1395y (a)(1). This means that the services provided must be reasonable and necessary to the treatment of the patient’s illness or injury within the context of the patient’s unique medical condition. See Medicare Home Health Agency Manual § 205.2. In addition, the amount, frequency and duration of the services must also be reasonable. Id.
Medicare requires that there be a medical certification of the need for home health services. This certification must be obtained at the time the patient’s plan of treatment is established or immediately thereafter. The plan of treatment must be signed and dated by a physician as described who meets the certification and recertification requirements; and before the claim for each episode for services is submitted for the final percentage prospective payment. 42 C.F.R. § 409.43(c)(3).
Recertification of a beneficiary’s need for home health services is required in order to receive services beyond the original 60-day episode. Medicare’s home health benefit is intended to address short-term medical goals, i.e. those achievable within 60 days. Accordingly, recertification for this benefit is intended to be the exception. Recertification for home health must be signed by the attending physician, preferably at the time the plan of treatment is reviewed. The provider is also required to maintain a clinical record for each patient receiving home health services. This plan of treatment record should contain appropriate identifying information, the name of the beneficiary’s attending physician, drug and dietary guidelines, and treatment and activity orders. The clinical record should be signed and dated and contain the beneficiary’s clinical and progress notes, copies of summary reports sent to the attending physician, and a discharge summary. 42 C.F.R. § 484.48
Fraud BOLO (Be on the Lookout)
There are several requirements that a beneficiary must meet in order to qualify to Medicare coverage of home health services, but it is these two requirements, specifically, that are commonly NOT met when healthcare fraud is involved:
- The patient (often referred to as “homebound”) must be confined to his or her home or an institution that is not a hospital, skilled nursing facility or nursing facility.
- The patient is in need of at least one of the following skilled services: skilled nursing, physical therapy, speech language pathology; or continuing occupational therapy.
Other illegal practices which constitute Medicare fraud relating to home health services are:
- HHA is treating beneficiaries and billing for home health services where there is a non-compliant or lack of certification of home bound status;
- HHA is treating beneficiaries and billing for home health services where such services are not medically reasonable and necessary;
- HHA is manipulating OASIS assessment forms in order to achieve more serious beneficiary diagnoses;
- Some providers are setting up shop on location within an ALF. They actually enter into a lease agreement with the ALF and include the ALF in its scheme. The lease payments are the quid pro quo for referrals, in violation of the Stark Law and Anti-Kickback Law;
- When a patient’s episode of care involves an unusually large number or a costly mix of visits, the HHA may be eligible for an outlier payment. This also opens the door to fraud, with offending HHAs up-coding HHRGs and manipulating case mix indexes to qualify for outlier payments;
- HHA is obtaining referrals through kickbacks, such as paying physicians for each plan of care certified by the physician on behalf of the home health agency;
- Paying referring physicians for services not rendered, or in excess of fair market value for services rendered;
- Providing hospitals with discharge planners, home care coordinators or home care liaisons in order to induce referrals;
- Providing free services, such as 24-hour nursing coverage, to retirement homes or adult congregate living facilities in return for home health referrals;
- Subcontracting with retirement homes or adult congregate living facilities for the provision of home health services, to induce the facility to make referrals to the agency.