Home Health & Hospice Week

CMS releases list of 78 HHAs suspended.

It could be your worst nightmare: A referral source is indicted, bringing scrutiny down on you too. How would you handle your existing patients referred by that physician?

That's the question many home health agencies in the Dallas area are struggling to answer in the wake of the indictment of Dr. Jacques Roy and three home health agencies in an alleged $375 million Medicare fraud scheme (see details of the indictment in Eli's HCW, Vol. XXI, No. 10).

The Centers for Medicare & Medicaid Services suspended Medicare payments for 78 HHAs in relation to the case, due to "credible allegations of fraud." CMS has now released the names of the agencies. About one-quarter of them appear to be based out of private homes, reports the Dallas News.

But many other non-suspended Dallas-area agencies have received referrals from Roy and other docs from his Medistat practice. Now they are left wondering how to handle those patients -- and deal with billing for those beneficiaries.

Industry experts offer this advice to deal with patients referred by referral sources whom you later learn are shady:

1. Reassess current patients. When you find out a referral source has been indicted, is under payment suspension, or is in other compliance trouble, you need to take the time and effort to reassess every patient you have on service who was referred by that source, recommends attorney Robert Mar-kette Jr. with Benesch Friedlander Coplan & Aro-noff in Indianapolis. You should thoroughly audit for the basics of eligibility -- homebound status and skilled need.

Once a physician is on the feds' radar, you can bet "every single referral will be looked at by somebody," Markette says. You need to be sure your claims and documentation will stand up to the scrutiny.

Hopefully your initial assessment process picked up any patients who weren't truly eligible for the Medicare home health benefit, Markette notes. But you might want to apply the standards more rigorously this time around. "Maybe you'll err on the side of caution," he suggests.

Technical details aren't the only factor to consider in reassessment. "Agencies should pay attention to their instincts or 'gut,'" advises Wash-ington, D.C.-based health care attorney Elizabeth Hogue. "If it looks like a duck, quacks like a duck and walks like a duck, then it's probably a duck," Hogue adds. "Agencies should investigate and take action regarding the 'ducks.'"

Don't be afraid of ticking off your referral source in situations where your compliance record is at stake, Markette stresses. "You'd much rather make the doc upset than the prosecutor upset, be-cause the doc can't send you to jail," he points out.

2. Seek a second opinion. It may be hard for you to be objective in reassessing your patients. Obtaining a judgment from an outside source may be a good bet when your compliance record is on the line. "One solution would be to hire an independent consultant to reassess in regard to each patient in question," advises attorney Janice Arnold with Mitchell Day in Ridgeland, Miss.

But ignoring advice from an outside consultant is worse than not soliciting that advice in the first place, experts warn. Last year LHC Group Inc. paid $65 million to settle a whistleblower lawsuit filed by a consultant it hired and then disregarded. "Follow the consultant's recommendations," Arnold urges.

3. Take action. Once you reach a decision on each patient's status, you need to follow through. If you determine the patient isn't really eligible for the Medicare home health benefit, then cut him loose and don't bill for him, counsels attorney Elizabeth Pearson with Pearson & Bernard in Covington, Ky.

You don't have anyone else to blame if you find they aren't eligible, Pearson adds. "If the criteria is not met, that is the fault of the HHA anyway" for missing it in the initial assessment, she maintains.

Sometimes a full discharge may not be necessary, but you will need to scale back services, Arnold notes.

But if the patient is indeed eligible, don't be afraid to bill for her, advises Rose Kimball with billing services company Med Care Administra-tive Services in Dallas. "If you didn't do anything wrong, bill your claims," Kimball exhorts. Let the Medicare contractor decide whether to deny or pay the claim.

In fact, it would look suspicious if you failed to bill for any of a troubled referral source's epi-sodes, believes Kimball, who formerly worked as an auditor for a Medicare intermediary. "If you just sweep them under the rug and eat the losses, then the auditor thinks that patient shouldn't have been on service," she says.

4. Continue with eligible patients. Don't shy away from continuing to serve patients who truly are eligible for the benefit. When a physician can no longer certify and sign the patient's plan of care, then you can help the patient to find another physician who can, offers Pearson.

Do this: HHAs like those in the Roy case, where the physician is in jail or otherwise ineligible, "should reach out to other doctors who they trust and direct the former Dr. Roy patients who are on service or need service to those doctors," Pearson says.

5. Look back. Auditing current patients isn't the only priority when a referral source is questionable. "Agencies should audit very intensively retroactively," Hogue counsels.

"Audit each and every client record [from an indicted referral source] to assure that the services were reimbursable," Pearson urges.

If you find ineligible patients you billed for previously, pay back the payments you billed for in error, Markette advises. It's much harder for prosecutors to justify criminal charges when you've already paid back the money at issue, he notes.

Remember: When you determine an overpayment exists, notify the government within 60 days in accordance with new Medicare rules on the matter, Arnold says.

6. Widen your audit scope. If you have one troubled referral source, you may have others. Open up your auditing to charts other than those from the identified physician, Markette suggests.

One way to identify records you should review is to determine whether you have physicians who are referring more than the average number of patients to you, Hogue offers. According to the letters that the suspended HHAs in the Roy case received from CMS and ZPIC Health Integrity, that figure is 5 to 10 percent.

You may want to monitor this number on an ongoing basis. Expect to see ZPIC activity in this area following the high-profile Roy case, Pearson predicts.

Note: For a list of the 78 suspended HHAs in the Roy case, e-mail editor Rebecca Johnson at rebeccaj@eliresearch.com with "Roy Suspended HHAs" in the subject line.