The Partnership has urged the federal government to consider reforms that raise the barriers to entry for providers, prevent payment of aberrant claims and implement quality and outcomes benchmarks—rather than payment cuts. It is also using the government's own data to show, for instance, that only 25 of the country's 3,143 counties are fraud “hot spots.”
“Coupled with MedPAC's annual list of the 25 counties in which excessive home healthcare episode utilization is occurring, Medicare data analyses demonstrate that fraud and abuse can be pinpointed and, thus, effectively targeted,” Eric Berger, the Partnership's CEO, wrote in a June 27 letter to the U.S. Senate Finance Committee. “We urge Congress to enact a set of tough solutions to attack this targeted problem, while safeguarding patients and the communities that honest providers serve.”
The HHS inspector general's office has long seen the rapidly growing home-care space as vulnerable to criminal activity. A March report noted that Medicare home health claims increased 84% from 2000 to 2007, to $15.7 billion from $8.5 billion, and concluded that in 2008 agencies submitted 22% of claims in error, resulting in $432 million in improper payments.
In two high-profile cases this summer, the owner of Willsand Home Health, Miami, pleaded guilty to a $42 million fraud scheme, and the co-owner of Family Healthcare Group, Houston, was sentenced to nine years in prison for participating in a $5.2 million scheme.
“Overall, there's a perception that there's a good deal of fraud and abuse,” said Susan Kayser, a New York-based attorney who specializes in long-term care at Duane Morris. “The enforcement agencies have sensed that there isn't as much oversight as there might be in an institutional setting. At least to some degree, the home-care industry as a group is trying to promote the sense that the home-care industry is as much against fraud and abuse as the government.”
The message has become more pressing as the CMS in July proposed 2013 payment cuts to home health agencies that are expected to have an effect of about 0.17% for urban for-profit agencies and 0.61% for rural for-profits, according to the agency's impact statement. The cuts are on top of a 2% across-the-board Medicare rate cut under the Budget Control Act.
The effort has also piggybacked on the Obama administration's actions to combat fraud, which it has made a top priority. This summer, for instance, the HHS and U.S. Justice Department launched a public-private partnership with health insurers to prevent abuse in healthcare billing.
In an interview, Berger acknowledged the link between home health reimbursement and the effort to combat criminal activity as policymakers have tried to make the space less profitable to bad actors.
“Much of the focus on cutting home healthcare payments has been driven by a desire to stem fraud and abuse,” he said. “We believe targeted reform is a better approach because it fixes the problem where it exists without hurting innocent seniors and providers across the U.S.”
Kevin Campbell, an analyst at Avondale Partners who covers the for-profit home health industry, said the Partnership was formed about 18 months ago to collaborate with policymakers.
“I think their view at the time was that (the National Association for Home Care and Hospice) was not offering enough solutions,” Campbell said, referring to the industry's major trade group. “Their hope is that they can replace some of these across-the-board cuts with some of these targeted programs.”
The National Association of Home Care and Hospice did not respond to a request for comment.
Both groups are among the backers of Fight Fraud First, a campaign to urge the government to target fraudulent activity as a way to save money before going after industry payments. Fight Fraud First's other prominent members include the AARP and Easter Seals.
The home health industry estimates that its recommendations can save between $15 billion and $18 billion over 10 years, Campbell said. “There is evidence that what they're saying is resonating somewhat,” he added.
The Partnership points to an August report from the inspector general's office that recommended many of the same reforms the group has supported, such as improving the billing process, preventing payment of unusual claims and putting a moratorium on new providers in saturated areas.
“Their recommendations are consistent with the kinds of reforms we've been talking about,” Berger said.
Campbell noted that the proposed rate cut was significantly less deep than expected. The industry also has avoided other floated proposals such as accelerated rate adjustments and copayments.