OIG: 25% of Agencies Made Inappropriate 2010 Claims

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By Terry Miller, RN 
Regulatory Advisor, McKesson

Home Health Agencies Monitor BillingHome health agencies should consider monitoring their billing practices more closely following an August report from OIG that concluded 25% of home health agencies (HHAs) exceeded recommended levels for at least one of six measures in 2010:

  1. High average outlier payment amounts per beneficiary (average outlier payments above $403 per beneficiary)
  2. High number of visits per beneficiary (average of 91 or more visits per beneficiary)
  3. High number of late episodes per beneficiary (average of more than two late episodes per beneficiary)
  4. High number of therapy visits per beneficiary (average of more than 24 therapy visits per beneficiary)
  5. High payments per beneficiary (average of more than $11,653 per beneficiary)
  6. High average number of therapy visits per beneficiary (more than 61% of beneficiaries for whom other HHAs billed Medicare)

The report, “Inappropriate and Questionable Billing by Medicare Home Health Agencies,” analyzed data from home health agencies, inpatient hospital and skilled nursing facility claims. In addition to identifying HHAs that billed unusually high amounts in one of the six measures, it found that Medicare inappropriately paid $5 million for home health that (1) overlapped with claims for inpatient hospital stays, (2) overlapped with claims for skilled nursing facility stays, or (3) included services on dates after beneficiaries’ deaths. The authors reported that most of the HHAs with questionable billing are in Texas, Florida, California and Michigan.

The report recommended CMS take these actions:

  1. Implement claims processing edits (or improve existing edits) to prevent inappropriate payments for the three specific errors mentioned above.
  2. Increase monitoring of billing for home health services.
  3. Enforce and consider lowering the 10% cap on the total outlier payments an HHA may receive annually.
  4. Consider imposing a temporary moratorium on new HHA enrollments in Florida and Texas.
  5. Take appropriate action regarding specific inappropriate payments identified by OIG.

In a letter dated June 27, 2012, CMS concurred with all five recommendations but disagreed with OIG’s estimate of the inappropriate payments for home health claims overlapping with claims for inpatient hospital stays and skilled nursing facility stays. CMS noted that in the absence of individual claims analysis, it is difficult to determine whether or not there was any financial impact from the submission of overlapping claims.

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