Deeper Than the Headlines: Home Care Compliance on the OIG’s Radar

Deeper Than the Headlines: Home Care Compliance on the OIG’s Radar

Posted by CJ Wolf
Jun 3, 2019 11:24:00 AM

In May 2019, the OIG released audits they’d performed on Home Care agencies. In the end, they reached the conclusion that numerous services were out of compliance.

Under the home health prospective payment system (PPS), the Centers for Medicare & Medicaid Services pays home health agencies (HHAs) a standardized payment for each 60-day episode of care that a beneficiary receives. The PPS payment covers intermittent skilled nursing and home health aide visits, therapy (physical, occupational and speech-language pathology), medical social services, and medical supplies.

Prior to OIG reviews of home health services identified significant overpayments to HHAs. These overpayments were largely the result of HHAs improperly billing for services to beneficiaries who were not confined to the home or were not in need of skilled services.

For the calendar year (CY) 2016, Medicare paid home health agencies (HHAs) about $18 billion for home health services. The Centers for Medicare & Medicaid Services (CMS) determined through its Comprehensive Error Rate Testing (CERT) program that the 2016 improper payment error rate for home health claims was 42%, or about $7.7 billion. Although Medicare spending on home health care accounts only for about 5 percent of fee-for-service spending, improper payments to HHAs account for more than 18 percent of the total 2016 fee-for-service improper payments ($41 billion).

OIG decided to review some HHAs, such as Excella HomeCare (Excella). Their review of Excella is part of a series of reviews of HHAs. Using computer matching, data mining, and data analysis techniques, OIG identified HHAs at risk for noncompliance with Medicare billing requirements and Excella was one of those HHAs.

Excella is a proprietary for-profit home health care provider with headquarters in Texas and a local provider office in Amesbury, Massachusetts. National Government Services, its Medicare contractor, paid this specific Excella provider approximately $32 million for 8,800 claims for services provided in CYs 2013 and 2014 (audit period) on the basis of CMS’s National Claims History (NCH) data. During the audit period, this Excella provider placed in the top 1% of home health providers in Medicare payments received.

OIG’s audit covered $30,860,249 in Medicare payments to Excella for 7,630 claims. These claims were for home health services provided in CYs 2013 and 2014. OIG selected a stratified random sample of 100 claims with payments totaling $431,751 for review.

The OIG found that Excella did not comply with Medicare billing requirements for 41 of the 100 home health claims that they reviewed. For these claims, Excella received overpayments of $129,520 for services provided in CYs 2013 and 2014.

Specifically, Excella incorrectly billed Medicare for:

  • Services provided to beneficiaries who were not homebound
  • Services provided to beneficiaries who did not require skilled services

The OIG concluded these errors occurred primarily because Excella did not have adequate controls to prevent the incorrect billing of Medicare claims within the selected risk areas. On the basis of their sample results, OIG estimated that Excella received overpayments of at least $6,636,091 for the audit period.

Homebound Requirements

For 28 of the sampled claims, OIG concluded Excella incorrectly billed Medicare for home health episodes for beneficiaries who did not meet the requirements for being homebound for the full episode (20 claims) or for a portion thereof (8 claims).

Example 1: Beneficiary Not Homebound – Entire Episode

The physical therapy evaluation documentation for one beneficiary showed that, from the start of the episode, the patient was ambulating several hundred feet without an assistive device, was independent with transfers, and had good overall strength in her lower extremities. For the entire episode, leaving the home did not require a considerable or taxing effort.

Example 2: Beneficiary Not Homebound – Partial Episode

For another beneficiary, records showed that the patient was initially homebound, as she was thought to require care in the home setting due to needing a cane and the assistance of another person to ambulate, having significant weakness and being at an increased risk for falls due to polypharmacy, disease process, and numerous comorbidities. By a later date in the episode, she was able to transfer and ambulate 200 feet with a rolling walker without hands-on assistance. She was residing in an accessible assisted living facility without mobility barriers. Leaving the home would no longer require a considerable or taxing effort.

Skilled Services Requirements

For 23 of the sampled claims, OIG stated Excella incorrectly billed Medicare for an entire home health episode (2 claims) or a portion of an episode (21 claims) for beneficiaries who did not meet the Medicare requirements for coverage of skilled nursing or therapy services.

Example 3: Beneficiary Did Not Require Skilled Services

A beneficiary with chronic obstructive pulmonary disease and a history of a fractured clavicle was homebound. The beneficiary developed a pressure sore, and skilled nursing services were ordered to provide wound care. Excella provided skilled nursing care to the homebound beneficiary. However, the beneficiary’s wound healed part way through the episode, and the beneficiary could have been discharged at that time with no need for the subsequent skilled nursing services. These errors occurred because Excella did not always provide sufficient clinical review to verify that beneficiaries initially required skilled services or continued to require skilled services.

Two Sides to Every OIG Story

As there are always at least two sides to every story, you might find the end of the report interesting.  It outlines how Excella disagreed with many of the OIG’s findings and/or methods.  Excella’s comments to the OIG are provided as well as the OIG’s response to Excella’s comments.  These are interesting exchanges to review. If you are in the Home Health space, you definitely want to read the recent audit reports the OIG has posted in late May 2019.

Questions or Comments?