Home Health & Hospice Week

Watchdog agency reminds hospitals to play by the rules with home care referrals.

Home health agencies now have a new weapon in their arsenal against hospitals that don't respect patient choice in selecting home care.

The complaint is as old as the industry - patients go into the hospital and come out discharged to the hospital-based agency instead of their previousHHA. "Non-hospital agencies feel like tremendous patient steering occurs," notes attorney John Gilliland with Gilliland & Caudill in Indianapolis.

But hospital-based agencies insist their parent organizations follow the rules. "Our related facility is very choice-oriented," maintains Linda Rutman, director of Munson Home Care and Home Services in Traverse City, MI.

Still, many freestanding agencies feel their patient referrals are being siphoned off by hospitals that don't follow discharge rules. The Balanced Budget Act of 1997 requires hospitals to give patients a list of HHAs and respect their choice, but "many providers questioned the usefulness of the provisions ... in view of the fact that there did not appear to be an enforcement mechanism," notes Burtonsville, MD-based health care attorney Elizabeth Hogue.

Now the HHS Office of Inspector General is reinforcing BBA patient choice requirements in its newly finalized supplemental compliance guidance for hospitals. The guidance, published in the Jan. 31 Federal Register, tells hospitals that as part of the discharge planning process, they must:  share with each beneficiary a list of Medicare-certified home health agencies that serve the beneficiary's geographic area, and 
  identify any HHA in which the hospital has a disclosable financial interest or that has a financial interest in the hospital. This new compliance guidance should remind hospitals of their BBA obligation regarding HHAs and patient choice, Gilliland tells Eli.

The OIG carries a big enforcement stick that could spur formerly reluctant hospitals into compliance. "The OIG has clearly indicated that it regards violations of patients' right to freedom of choice ... as a fraud violation," Hogue notes. "The OIG's reasoning is that steering patients to entities owned by hospitals may increase costs to the [Medicare] program."

In conjunction with a hospital Condition of Participation on discharge planning that took effect last October (see Eli's HCW, Vol. XIII, No. 32), the OIG guidance should prove a deterrent to patient steering. In addition to fraud charges, "the bottom line is that hospitals could be decertified for violations" under the COP, Hogue stresses.
Hospital-Based HHAs Have Natural Advantage Freestanding agencies must realize the OIG guidance and discharge COP aren't meant to cancel out patients' frequent preference to stick with the hospital-based agency if they've had a positive experience with the hospital itself, Gilliland points out. Hospitals can generally keep 80 to 90 percent of their referrals without actually violating the law or regulations, he believes.

For example, under [...]