June 29, 2016

CMS Tries to Stop Home Care Fraud Before it Happens

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Last week was a busy week in the news: affirmative action survived the Supreme Court, immigration amnesty did not, seemingly everyone except Donald Trump was surprised by the Brexit vote results, and Cleveland won a championship. Yet with all that, there was still time for the U.S. Department of Justice to announce its record Medicare fraud takedown, which involved $900 million in false billings and charges against 301 individuals, including 61 doctors. And many of the cases involved fraudulent claims for home care services that were medically unnecessary or not even provided.

I can attest to the audacity of home care fraud – several years ago one of my very active elderly patients went to a party in his retirement community and was asked to sign in and show his Medicare card. Before long a nurse started showing up at his house checking on him and a therapist came and did some exercises with him. As a widower, he liked the extra attention but did not need it; he was neither homebound nor in need of skilled care. Of course, I reported the company to the Medicare fraud hotline.

While it makes great headlines to catch these criminals after their crimes have been committed, the Centers for Medicare & Medicaid Services (CMS) wants to stop them before they even get started, so it just introduced a demonstration project in Illinois, Florida, and Texas called the Pre-Claim Review Demonstration for Home Health Services. In essence, any time a home care agency starts a home care episode on a patient, it will be required to submit the documentation of the patient’s qualifying visit with a provider, the order for homecare services, and documentation of their homebound status and their skilled needs to a Medicare Administrative Contractor (MAC).

The MAC then will review the documentation and either approve the episode and issue a tracking number or tell the home care agency that the documentation is inadequate and allow them to submit additional notes as many times as necessary to get it approved. If this process is not followed and no pre-claim review is performed, the claim will automatically undergo prepayment review, and if it eventually passes review, the payment to the agency will be reduced by 25 percent.

It should be noted that this is not a prior authorization program, as with certain durable medical equipment that requires an authorization before the service can be provided. Home care agencies do not need to do anything special to start an episode of care; they get a referral, they gather the usual information, and they provide the care. Once the care has started, they then submit the documents to the MAC. They can even use the esMD system to make it less disruptive. The MAC is supposed to render a decision in 10 business days on the initial determination and 20 business days on resubmissions, so if done right, this will not even affect cash flow.

Of course, what sounds great on paper, and what will certainly reduce fraud, may turn into a disaster for the majority of legitimate home care agencies. Will the MACs understand the homebound requirements, and who can document what? If you recall, CMS changed the requirements for a face-to-face form in response to a failed attempt at reducing fraud that was widely misinterpreted by the MACs and simply created frustration and denials for providers.

And will the MACs be able to achieve the 10-day turnaround time? A cursory review of a Medicare database revealed over 100 active home care agencies in Texas alone, with over 100,000 episodes of care a year; that is a very large volume of reviews for the MAC staff to perform with a 10-day turnaround time, with little time to employ and train competent staff.

And we know all too well that hitting timelines seems to be a big challenge for all of the CMS contractors these days, including the quality improvement organizations (QIOs) handling short-stay reviews and of course the hundreds of thousands of Recovery Auditor (RAC) denials that remain past due.

We will know soon enough how this rolls out; the program starts in Illinois on Aug. 1.

About the Author

Ronald Hirsch, MD, FACP, CHCQM, is vice president of the Regulations and Education Group at Accretive Physician Advisory Services at Accretive Health. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices, and he is a published author on the topic. He is a member of the Advisory Board of the American Case Management Association and a Fellow of the American College of Physicians. 

Contact the Author 

RHirsch@accretivehealth.com 

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