Home Health & Hospice Week

But states’ lagging surveys may contribute to that initial figure.

Medicare officials continue to tighten the screws on hospice fraudsters, but how much pressure can compliant hospices take before they crumple?

In a blog post published on Aug. 22, the Centers for Medicare & Medicaid Services decries the fraud problem in the industry. “Unfortunately, hospices are profiting from fraud at the expense of beneficiaries far too often,” claim Dara Corrigan, deputy administrator and director of the CMS Center for Program Integrity, and physician Dora Hughes, chief medical offer for the CMS Center for Medicare and Medicaid Innovation.

Media reports have “brought attention to a trend of ‘churn and burn’ schemes,” among other fraud and abuse problems, Corrigan and Hughes highlight.

Definition: “The ‘churn and burn’ scheme is when a new hospice opens and starts billing,” explains consulting firm The Health Group in Morgantown, W. Va. “Once the hospice is audited or reaches the hospice cap, the hospice shuts down, fails to repay the debt to the Medicare program, and then acquires another hospice provider and transfers the patients to the newly acquired hospice and starts billing again,” The Health Group says in its electronic newsletter.

“CMS has adopted new policies and safeguards to quickly identify and take action against hospices engaged in such practices, to ensure they are providing critical, quality care to some of our most vulnerable beneficiaries at end of life,” Corrigan and Hughes stress. They list the many regulatory and subregulatory program integrity steps taken over the past year, ranging from survey changes to a prepayment medical review “pilot project” to the 36-month rule (see details in story, p. 233).

And CMS announces for the first time that after making unannounced site visits to over 7,000 hospices nationwide, “nearly 400 hospices are being considered for potential administrative action as of mid-August.” That action could include deactivation and revocation, Corrigan and Hughes detail. CMS shared preliminary information on that project with hospice trade groups in a meeting last month (see HHHW by AAPC, Vol. XXXII, No. 27).

A potential 400 agencies out of 7,000 could be affected — or nearly 6 percent. That number could be lower or higher than expected, depending on your point of view.

“Four hundred out of 7,000 would normally seem high, because that means … that their visits identified 400 enrolled providers who did not appear to be at the address provided,” judges attorney Robert Markette Jr. with Hall Render in Indianapolis. “However, after what went on in California, 6 percent seems low,” Markette tells AAPC.

Keep in mind: If CMS prioritized providers for visits in the four states it set out for enhanced scrutiny, the number of providers being considered for administrative action so far “may be higher than what can be expected of CMS’s remaining site visits,” attorney Emily Solum with Husch Blackwell in Jefferson City, Mo., points out to AAPC. In mid-July, CMS told trade groups it had completed 93.5 percent of visits under the program.

Plus: That figure is likely to change because hospices having incorrect addresses on file may not be their fault. “Some states, for example, are very far behind in doing surveys after changes in location,” explains Washington, D.C.-based healthcare attorney Elizabeth Hogue. “Consequently, new locations may not be recorded in the PECOS and other relevant systems. Some of the states that are specifically targeted by CMS have this problem. Providers have timely filed Forms 855A and taken all other required actions, but their locations are incorrect through no fault of their own,” Hogue says.

But NAHC is not surprised by the 6 percent figure, “particularly given the swift growth in hospice agencies in recent years and some of the reports of the types of activities that are occurring,” says Theresa Forster with the National Association for Home Care & Hospice. “We do anticipate … that there will be a substantial number of hospices that serious action will be taken against,” Forster says.

Note: The CMS blog post is at www.cms.gov/blog/cms-taking-action-address-benefit-integrity-issues-related-hospice-care.