Home Health & Hospice Week

Not all the details are out about Medicare’s latest annual improper payment rate findings, but it’s clear that home health agencies continue to make fewer claims errors.

The Centers for Medicare & Medicaid Services recently announced that “home health improvements … resulted in a $5.9 billion decrease in estimated improper payments from FY 2016 to FY 2020” (see HCW by AAPC, Vol. XXIX, No. 41). The overall Medicare improper payment rate fell to 6.27 percent in 2020, down from 7.25 percent last year.

Now a CMS spokesperson tells AAPC that “the improper payment rate for home health claims decreased … to 9.30 percent in FY 2020.” That’s down from 12.1 percent last year, and way down from a whopping 59 percent just five years ago in 2015. The rate has been steadily falling at 42 percent for 2016; 32 percent for 2017; and 17.6 percent for 2018.

A Department of Health and Human Services Agency Financial Report reveals more details.

For example: “Insufficient documentation for home health claims continues to be prevalent,” HHS says in the report. “The primary reason for the errors was missing or insufficient documentation to support the certification of home health eligibility requirements. Medicare coverage of home health services requires physician certification of the beneficiary’s eligibility for the home health benefit.”

Medical necessity was the second-highest error category for HHA claims, HHS notes. No documentation was the third.

Incorrect coding accounted for an exceedingly small percentage of the errors, according to a bar graph in the report.

The HHA error rate is now far from the highest. Inpatient rehabilitation facilities racked up a 30.8 percent error rate in 2020, compared to 34.9 percent the previous year.

The other two provider types HHS singles out as “drivers” of improper payments are outpatient hospitals and skilled nursing facilities.

The SNF error rate dropped from 8.54 percent in 2019 to 5.43 percent in 2020, HHS says. In contrast, the outpatient hospital error rate stayed almost steady at 4.02 percent in 2020 compared to 4.37 percent last year.

HHS doesn’t list the error rates for other provider types, including hospices. A forthcoming report will provide more detail on those statistics.

HHS: RAPs Contribute To Pay Errors

HHS lists four “corrective actions” it is taking in the home health arena:

1. Targeted Probe & Educate. In FY 2020, Medicare Administrative Contractors reviewed about 582 HHAs under the TPE program, HHS says.

2. Review Choice Demonstration. “In FY 2020, HHS affirmed provisionally (or approved) 786,586 billing periods for home health services,” according to the report.

3. Recovery Audit Contractor. “In FY 2020, the national HHA RAC conducted comprehensive documen­tation and medical necessity review of home health claims. HHS approved the Medicare FFS Home Health and Hospice RAC to review home health claims for several factors, including lack of documentation to support medical necessity of provided home health services, insufficient documentation to support billed home health claims, and if home health services were rendered as billed.”

4. RAPs. CMS reduced the up-front RAP payment to 20 percent for existing agencies in 2020 and is eliminating RAP payments altogether in 2021.

In rulemaking, CMS insisted the elimination would combat RAP abuse, although industry members were heavily critical of the move. They even more harshly condemned CMS’s move to impose payment penalties for every day a RAP is late starting five days after the start of care (see HCW by AAPC, Vol. XXIX, No. 41).

Years back, CMS had noted some HHAs had billed a high volume of RAPs, never billed corresponding final claims, and disappeared with the money.

Now HHAs under PDGM are paying the price. Such abuse “represented enough of a concern that we now see the RAP payment being eliminated,” notes reimbursement expert M. Aaron Little with BKD in Springfield, Missouri.

Note: The 326-page HHS report is at www.hhs.gov/sites/default/files/fy-2020-hhs-agency-financial-report.pdf.