Home Health & Hospice Week

Questions about outlier calculation process abound.

Abuse of outliers for home health agencies seems to have waned since Medicare implemented a 10 percent cap on the payments in 2010, but providers entitled to the reimbursement continue to struggle to receive their rightful payment — or even understand it.

Home health agencies have been hit with recoupments for outliers they were supposedly paid in error, reports the National Association for Home Care & Hospice. Medicare Administrative Contractors are telling agencies they were overpaid in 2010 and 2011 because the 10 percent cap wasn’t calculated correctly.

Such recoupments are "really going to hurt," warns Lynn Olson of Astrid Medical Services in Corpus Christi, Texas. HHAs are particularly burdened by the lack of advance notice of the recoupments.

Affected agencies received calls from their MAC and recoupments were initiatied the following day, NAHC says. Olson has seen clients hit with takebacks of up to $13,000 so far, he says.

Background: The recoupments come on top of years of problems securing rightful outlier payments. The outlier payment shortfalls were crippling some agencies (see Eli’s HCW, Vol. XXI, No. 15). They reached into the millions for some large agencies, NAHC recalls.

The Centers for Medicare & Medicaid Services did finally make claims system corrections that worked and started paying agencies their outlier funds last fall, NAHC notes. But then these recoup-ments hit.

The takebacks seem to be based on incorrect cap calculations, NAHC says. "The error appears to be the result of underreporting of total revenue calculations" by the MAC, the trade group says.

For example: One agency with $17 million in revenue was reported with revenue of only $4.5 million, NAHC relates. That limits their outlier cap to 10 percent of the much smaller revenue figure.

Outlier Process Confuses Agencies

This latest round of takebacks highlights the confusion that many providers share over the outlier process in general, Olson tells Eli. HHAs don’t understand how the quarterly reconciliation process works, how one quarter’s calculations affect another’s, and how the annual cut-off affects agencies, for example.

"Providers deserve a detailed explanation of the quarterly methodology," Olson contends. And any providers subject to a recoupment need a thorough explanation of the underlying calculation and advance notice, he insists.