Home Health & Hospice Week

Recoupments not as gradual as promised.  You could be the next home health agency hit by a problem with partial episode payment takebacks - an error that has cost one agency a half million dollars. After numerous delays, the Centers for Medicare & Medicaid Services and its intermediaries started recouping money from HHAs in August for missed PEP adjustments. The claims processing system failed to make many PEP adjustments in the first two-and-a-half years of the prospective payment system. CMS promised agencies their PEP takebacks would be made gradually over a 24-month period (see Eli's HCW, Vol. XII, No. 26, p. 202). But when VNA Care Network in Worcester, MA checked on the progress of its recoupments in the first few months of the process, it was shocked to discover 90 percent of the projected takebacks - $500,000 - were made in just the first two months, says VNA Care Vice President for Finance Pierre Henry. The Visiting Nurse Association of Boston found itself in a similar situation, with a whopping 60 percent of its projected PEP recoupments - $300,000 - withheld in the first few months of the process, says VNAB Vice President of Finance Ken McNulty. Spread out evenly over two years, the system should have been recouping only a little more than 4 percent of their backlogged PEPs per month. Both VNAs had to borrow on their lines of credit due to the unexpected slash to their cash flow. "It's costing us 3.5 to 4 percent" on the borrowed funds, Henry tells Eli. When they first discovered the problems, the VNAs made numerous calls to their regional home health intermediary, Palmetto GBA, to no avail. But once Visiting Nurse Associations of America VP for Regulatory and Public Affairs Bob Wardwell stepped in, CMS and Palmetto promised to get the situation resolved. But at press time, neither Henry nor McNulty had heard a definitive answer on how the problem will be rectified, they said. Palmetto and CMS say the affected providers will see partial refunds of the recoupments and suspensions of any further takebacks for a while, says Wardwell, a former CMS official. But exactly how much Palmetto plans to refund and when remains in question. "I'll believe it when I see the check," Henry says. The problem arose when the "random" selection of claims for recoupment was based on patients' health insurance numbers, which in turn are based on their social security numbers, Wardwell explains. The system began to take back money for patients with SSNs that began with zero - those in the New England area. The VNAs are two of only a handful of Massachusetts agencies served by Palmetto as RHHI, and their patients with [...]