Home Health & Hospice Week

HHAs Can Check Their Impending PEP Recoupments 'Any Day,' RHHI Says


Around $250 million in partial episode payment (PEP) adjustments are about to commence, but exactly when is still in question.

Regional home health intermediary Cahaba GBA said in a July 3 posting on its Web site that it would make all the PEP recoveries from October 2000 through April 2002 available to HHAs the week of July 7, and would start making recoupments the following week.

But the Centers for Medicare & Medicaid Services has put the brakes on that schedule. "Cahaba seems to have jumped the gun in publishing a date," a CMS official tells Eli. Cahaba now expects to shift that start date to July 21, a Cahaba official says.

CMS has told the National Association for Home Care & Hospice PEP takebacks will begin at the end of July, according to William Dombi, vice president for law with NAHC's Center for Health Care Law.

"In the next week, all the RHHIs should receive further CMS instructions and will be publishing announcements of the correct start date," the CMS source clarifies.

Officials with RHHIs United Government Services and Palmetto GBA confirm they are waiting on the final word from CMS before setting a date for first making the adjustments available, then actually recouping the money.

While the exact date of the recoveries remains unsure at press time, the process has been fairly well hammered out (see story, "Billing:  Check PEPs Before RHHIs Start Recouping").

Many agencies probably already know they have PEP adjustments coming, claims a UGS representative. But industry veterans insist most HHAs will be completely blindsided by the adjustments, which could be quite large.

Recent Reimbursement Reductions Sharpen PEPs' Cutting Edge

The so-called 15 percent cut to home care reimbursement rates last October added to the elimination of the 10 percent rural add-on in April are "significant enough to make the PEP recoveries a serious threat to an agency's financial survival," no matter how gradually the takebacks proceed, argues consultant Pam Warmack with Ruston, LA-based Clinic Connections.

"Home care has been cut more than any Jack the Ripper victim and it seems as if CMS intends to continue the torture," Warmack laments.

One agency that has no idea how it will fare when PEP recoupments take effect is Houma, LA-based Terrebonne Home Care Inc. The agency is "in the dark" on whether it will have next to no adjustments, or a long list of them, says Terrebonne's Marilyn Guffey.

"There's no way to know," Guffey says, especially since the HHA's billing staff has turned over since most of the PEPs would have been incurred. Guffey hopes the intermediaries will issue clear instructions on how to check impending PEPs as soon as they are available so agencies can prepare.

That's why the longer CMS puts off PEP recoveries, the better off agencies will be, Warmack says. "Just as agencies had to begin preparing far in advance for the PPS changes, they are needing to begin the same planning for this new threat," Warmack tells Eli.

One last hope for staving off PEP recoveries is a potential lawsuit. NAHC is considering filing a suit challenging CMS' right to go back more than two years to recoup money that it paid out due to its own system errors, Dombi says.

Under Medicare regulations, CMS can go back more than a year only if it has "good cause" to reopen the claims, Dombi says. The suit will argue that CMS' own claims processing system problems aren't good cause.

But any potential suit could face major hurdles. If the courts wait until after CMS makes the recoupments and requires HHAs to file individual appeals against each PEP'd claim, it could be years before agencies see any relief - too late for many. "We want to prevent the recoveries," Dombi says.

Whether the courts will force the wait depends on their view of Medicare jurisdiction issues. "It's touchy," Dombi admits.