The CMS is developing a pilot program to determine just how many Medicare fraud cases are taking place in home health agencies. A contractor search is underway to help implement the initiative.
Medicare fraud experts praised the endeavor. “Home health is a small part of the Medicare program, but the long-standing allegations of fraud tarnish the sense of integrity of the entire program,” said Vernon Smith, managing principal at Health Management Associates. “My father used to say, 'If you have to swallow a frog, swallow the big one first.' In home health, the big frog is definitely in South Florida.”
Medicare home health expenditures totaled $16.6 billion in 2013, the CMS said in the "solicitation notice for the contractor (PDF).Between 2010 and 2014, nearly $1 billion in improper Medicare payments and fraud has been identified relating to the home health benefit, according to HHS' Office of Inspector General.
Home health services include part-time or intermittent skilled-nursing care, as well as other skilled-care services, such as physical, occupational and speech therapy, medical social work and home health aide services.
Despite the publicly cited estimates of fraud, a statistically valid estimate of the rate of fraud in Medicare does not currently exist either generally or specifically for home health agencies, according to the CMS. The contractor the agency seeks will develop methodology to estimate the extent of probable fraud of home health agencies in the Medicare fee-for-service program.
The initial pilot will focus on home health agencies in Florida, which accounted for $2.1 billion of total Medicare home health spending in 2013. It's also known to be a focal point for fraud. Late last year, for example, an owner of a Miami home healthcare company pleaded guilty for his role in a $30 million home health Medicare fraud scheme.
The contractor will review 130 home health claims in the Miami-Dade County area to begin the project. As part of the claim review process, the contractor will perform in-person interviews with both beneficiaries and their medical providers and make unannounced visits to the business offices of onsite home health-care agencies. Any methodology formed would later be replicated on a larger, nationwide program.
Determining just how much of overall Medicare fraud is taking place in home health agencies could help the CMS better allocate its resources, said Dr. Robert Berenson, a senior fellow at the Urban Institute and former member of the Medicare Payment Advisory Commission.
But some stakeholders said they were confused about the necessity of the program, and especially the need to start it in Miami-Dade County. The Health Care Fraud Prevention and Enforcement Action Team (HEAT) already is monitoring the area for Medicare fraud in home health agencies, for example. The taskforce was created by HHS and the Department of Justice in 2009.
Since HEAT was established in Miami-Dade County, the number of home health agencies in the area has fallen from 958 in 2009 to 471 as of the start of 2015, according to the Home Care Association of Florida.
“Why focus this study on a geographic area that has been fully investigated already?” said William Dombi, vice president for law at the National Association for Home Care and Hospice. “I highly doubt that any findings from such study would be of value in rooting out fraud given the intensity of investigations that have already occurred.”
Others agreed. “If these findings will be used to validate a process that will be applied nationwide it is irresponsible of CMS to not make it the best that it can be at this early juncture,” said Bobby Lolley, executive director of the Home Care Association of Florida.
“Miami-Dade may make for good headlines, but it does not make for a good sample data set that will represent the entire industry.”
Louis Saccoccio, CEO of the National Health Care Anti-Fraud Association, saw wider implications as well.
“Although this project will initially focus only on home healthcare, I think it is a solid first step to begin to determine some statistically valid estimate of the percentage of fraud in the program,” Saccoccio said.
Follow Virgil Dickson on Twitter: @MHvdickson
