Home Healthcare Fraud
Home Healthcare Reimbursement
Home Healthcare 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: (1) confined to the home (or ALF), except for infrequent or short absences or trips for medical care; and (2) requiring one or more of the following qualifying services (a) physical therapy; (b) speech-language pathology; or (c) intermittent skilled nursing.
Medicare pays for covered Part A and Part B services based on a prospective payment system (“PPS”). Under Part A, payment for home health care 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”). The OASIS is what Medicare uses to determine the amount of the payment the provider is entitled to receive. Medicare’s prospective payment system, permits for higher payment rates for care to beneficiaries with greater needs. Importantly, the OASIS form, informs Medicare as to the number of home health visits which will be required for the patient’s care during a 60 day episode. For 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. Every time it is assessed that a patient will require 10 or more visits during an episode, the provider receives additional Medicare dollars.
Payment for home health services is made based on a 60 day episode. 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 to Look Out For
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: (1) 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. (2) 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: (3) provider is treating beneficiaries and billing for home health services where there is a non-compliant or lack of certification of home bound status; (4) the provider is treating beneficiaries and billing for home health services where such services are not medically reasonable and necessary; (5) the provider 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 opens the door to fraud, with offending HHAs up-coding HHRGs and manipulating case mix indexes to qualify for outlier payments.
In addition to obtaining re-certification of homebound status for non-homebound patients some providers will list them as a new patient referral in its submissions to Medicare, enabling the provider to secure Medicare payments for additional 60 day episode.
Other questions to ask include: Did the HHA pay physicians for each plan of care certified by the physician on behalf of the home health agency? Did it disguise referral fees as salaries by paying referring physicians for services not rendered, or in excess of fair market value for services rendered? Did it offer free services to beneficiaries, including transportation and meals, if they agreed to switch home health providers? Did it provide hospitals with discharge planners, home care coordinators or home care liaisons in order to induce referrals? Did it provide free services, such as 24-hour nursing coverage, to retirement homes or adult congregate living facilities in return for home health referrals? Did it subcontract 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?
Violations of one or more of these requirements may give rise to a successful qui tam lawsuit under the False Claims Act.
OIG Report – Improvements on the Horizon
The Government Accountability Office (GAO) released a Medicare report in mid March 2009 stressing the need for improvements to address improper payments in home health. Upcoding and other fraudulent practices were to blame, according to GAO, for at least part of the 44% increase in home health spending between 2002 and 2006.
The Report recommends changes to the way CMS administers the Medicare home health benefit, so that it is less vulnerable to fraud. Some examples of inefficient practices by CMS include that CMS does not require Regional Home Health Intermediaries, to verify criminal histories of those named on the HHA applications. Physicians, while they are not generally included in the agency’s efforts to detect fraud, should also be brought into the fold of fraud detection, the Report concludes. And while CMS regulations allow for removal of HHAs or their officials when they have billed for services that were not rendered, CMS does not have the same strong-arm approach to remove HHAs or officials who have committed other types of abusive billing practices.