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HHS Watchdogs: Home Health Smells

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Daniel Levinson, the inspector general of the U.S. Department of Health and Human Services (HHS), says results from a new study suggest problems with Medicare home health agency billing realy may be common.

An analysis of Medicare billing data suggest that questionable home health agency billing may be especially common in 4 states.

Levinson says the Centers for Medicare & Medicare Services (CMS), the arm of the HHS that oversees Medicare, should consider imposing a temporary moratorium on new home health agency enrollments in Florida and Texas.

In those states and others, CMS should increase monitoring of home health services, be tougher about paying what appear to be unusual bills, and take steps to prevent Medicare from paying bills that appear to be affected by three specific types of errors, Levinson says in a report summarizing the findings of investigators at the HHS Office of Inspector General (OIG) on inappropriate and questionable Medicare home health agency billing.

Medicare does not pay for long-term care (LTC) in nursing homes, but it does pay for some short-term recovery care in nursing homes, and it does pay for home health care. It paid $19.5 billion to 11,203 home health agencies in 2010. The agencies served 3.4 million people, or about 1% of the U.S. population.

Home health services billing is vulnerable to fraud, waste and abuse, Levinson says.

In the report, he cites a recent case involving a Texas physician who helped home health agencies bill Medicare for $350 million for services that were not medically necessary or were not provided.

Earlier HHS OIG work comparing claim billing codes with medical records indicated that 22% of Medicare home health agency claims are in error because the services provided were not medically necessary or the claims were coded in accurately, and those erroneous claims led to $432 million in improper payments, Levinson says.

That review compared only billing codes to records and did not determine whether the records themselves were accurate, Levinson says.

To produce the research for the new report, investigators looked for agencies that scored substantially above the 75th percentile level on any of 6 measures indicating possible questionable billing.

The 6 measures used were:

  • High average outlier payment amount per beneficiary.
  • High average number of visits per beneficiary.
  • High percentage of beneficiaries for whom other agencies billed Medicare for home health services.
  • High average number of late episodes per beneficiary.
  • High average number of therapy visits per beneficiary.
  • High average Medicare payment amount per beneficiary.
The investigators found that 9% of home health agencies had scores over the extra-attention threshold on 2 or more of the 6 measures, Levinson says.

“Acknowledging legitimate instances of unusually high billing is necessary, but it is equally necessary to examine [agencies] that bill unusually high amounts relative to other [agencies] to determine whether such billing is inappropriate or fraudulent,” Levinson says.

The investigators also used each beneficiary’s health insurance claim number to link inpatient hospital and skilled nursing facility claims to home health claims, and to link the claims with the beneficiaries’ dates of death.

The investigators found evidence that Medicare may have paid $5 million for home health claims that affected by 3 types of errors involving dates of service: 

  • Claims for 2 or more overlapping inpatient hospital stays.
  • Claims for home health services provided and skilled nursing home stays occurring on overlapping dates.
  • Claims for services supposedly provided after beneficiaries’ dates of death.

Those kinds of errors appeared in 1,857 claims filed by 1,285 agencies, Levinson says.

About 80% of the agencies with high questionable billing scores were in Texas, Florida, California and Michigan. Those 4 states do not have a certificate-of-need policy that limits the number of home health agencies in operation, Levinson says.

The ratio of high scores on questionable billing measures to the number of home health agencies is much higher in Texas and Florida than in the rest of the country, Levinson says.

When considering whether to impose a Medicare home health agency enrollment moratorium in those states, “CMS should determine whether this moratorium should be imposed statewide or imposed in specific counties and/or metropolitan areas,” Levinson says.


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