Facing an epidemic of Medicare fraud in the home-care industry, the federal government is putting a hold on approving new home-care providers in some areas of the country, capping certain types of payments, and using more sophisticated data analyses to uncover foul play. Those decisions have support from a leading home-care trade group.
About half of the Justice Department's healthcare fraud caseload involves home care, said Peter Carr, a Justice Department spokesman. William Dombi, a vice president at the National Association for Home Care and Hospice, said he's seeing a new indictment or conviction nearly every week.
Home care, durable medical equipment and mental healthcare are the three biggest areas for healthcare fraud, said Marc Smolonsky, a consultant who works on fraud issues. Home care is an easy target for fraudsters, who can bill Medicare for many types of services under the umbrella of home care. “Once you have access to beneficiaries, you can submit all sorts of bills using their beneficiary numbers,” he said.
The home-care industry has been the focus of numerous investigations, settlements and judgments. That activity is related to the proliferation of home-care agencies and increased scrutiny by federal prosecutors, experts say. In 2010, 1 in 4 home-care agencies had questionable billings, according to a 2012 study by HHS' Office of the Inspector General.
“Home healthcare is under the microscope now,” said Mark Silberman, a partner with law firm Duane Morris, who represents home-care agencies. “I have no reason to believe those efforts won't continue.”
The CMS has stopped approving new agencies for government payment in the Chicago, Dallas, Detroit, Fort Lauderdale, Fla., Houston and Miami areas. Dombi's group has asked the government to limit the percentage of revenue any one agency can get from Medicare outlier payments. The Patient Protection and Affordable Care Act caps that figure at 10% of total payments.
Many cases involve allegations of kickbacks paid to recruiters. Agencies are not allowed to pay recruiters to bring in patients for services paid for by the federal government.
They sometimes break the law unintentionally, such as by setting up a bonus program for employees who refer patients, said Amanda Barbour, a lawyer with Butler Snow, who represents home-care companies.
“This is something that's really going to be scrutinized,” she said. “So you should really just expect someone's going to come knock on your door one day.”