Home Health & Hospice Week

ZPIC audits are shutting down home care providers across the country. If you don't want to be one of the casualties, there are steps you can take to prepare before an audit ever hits your doorstep.

Zone Program Integrity Contractor activity "is even more lethal" than Operation Restore Trust investigations in the late 1990s, when one-third of the industry was put out of business, worries consultant Pam Warmack with Clinic Connections in Ruston, La. "I fear we will see closure of providers as well as prosecutions," Warmack predicts.

The ZPICs the Centers for Medicare & Medicaid Services has named in three zones are hitting agencies with audits. Then those HHAs are getting hit with astronomical extrapolated overpayment demands or payment suspensions (see Eli's HCW, Vol. XIX, No. 32, p. 250).

Here are steps you can take before an audit to guard against such drastic measures:

1. Look at benchmarks. ZPICs and other Medicare contractors are using data to determine their audit targets, notes Warren Hebert of the HomeCare Association of Louisiana. ZPICs are focusing audits on providers with aberrant billing patterns. In some cases, "agencies aren't realizing they stick out like a sore thumb," Hebert cautions.

For example: Some rural HHAs are seeing much longer lengths of stay than their urban counterparts, which can put them on auditors' radar screens, Hebert observes. In one payment suspension case of a Texas agency, extremely high outlier billing in 2008 landed the HHA on review (see Eli's HCW, Vol. XIX, No. 32, p. 252).

Do your own research or employ a benchmarking contractor to find out where your services are outside of the norm, Hebert recommends. Then make sure those services are justified.

2. Bank some capital. "Organizations should build and maintain cash reserves for three months of working capital at a minimum," urges financial consultant Tom Boyd with Rohnert Park,

Calif.-based Boyd & Nicholas. That way when cash flow disruptions like a ZPIC payment suspension hit, you'll be prepared to weather the storm. "We recommend that every business do a cash flow budget and projections," Boyd recommends in a white paper on the topic. "However, a reasonable and quick means to determine cash needs is to assume that your average monthly expenses are one month's cash. Accordingly, multiply the onemonth average times three to get the approximate 90 days of cash you need to have available."

3. Beef up your documentation. Your success in surviving an audit, including appeals, depends on your documentation, says attorney Edward Vishnevetsky with Thompson Coe Cousins & Irons in Dallas.

Providers must make sure their documentation is in line with Medicare requirements and guidelines "to a T," Vishnevetsky stresses. That includes content concerns, such as why certain services or items are medically necessary, as well as technical issues such as the legibility of the physician's signature.

4. Focus on your weak spots. Use benchmarking and other self-assessment techniques to highlight the areas where you may be most vulnerable. Then focus on improving your documentation  and processes for those areas first. For home health agencies, this will usuallyinclude your patients' homebound status, says Washington, D.C.-based health care attorney Elizabeth Hogue. ZPIC Health Integrity repeatedly cited homebound issues in its recent payment suspension of a Texas HHA.

"Agency managers perceive that they are extremely vulnerable regarding this issue for at least two key reasons," Hogue says in a white paper on ZPIC audits. The standards used to determine homebound status remain ill-defined, she notes. And "since Medicare homecare services are provided only intermittently, as opposed to continuously, agencies are unable to verify homebound status with absolute certainty."

Documentation should address two main areas, Hogue counsels. Agencies must show why the patient's clinical condition supports her homebound status. And HHAs must show what the patient is actually doing.

Do this: During the admission visit, HHAs should inform patients of Medicare's homebound  criteria and document that the information was shared, Hogue recommends. Then staff should periodically interview the patient to check up on homebound status.

5. Know Medicare's requirements. Ignorance of Medicare rules will not protect you from a ZPIC audit. Home care providers should refer to the Medicare Benefit Policy Manual, Chapter 7 and the Medicare Claims Processing Manual, Chapter 10 to fully understand their requirements under the program, offers ZPIC audit consultant Tim Johnson with Jackson Davis HealthCare in Denver.

6. Implement a compliance plan. "Providers should not wait until their claims are under the microscope," urges law firm Liles Parker, with offices in Washington, D.C. and Texas. "If you have not already done so, we strongly recommend that you implement an effective compliance plan," the firm says on its website. (For compliance plan tips, see Eli's HCW, Vol. XIX, Nos. 23, 29 and 30.)