Home Health & Hospice Week

Here's what to do now about the proposed therapy changes.

Come Jan. 1, you'll say goodbye to the 10-visit therapy threshold and hello to a much more complex reimbursement mechanism for therapy visits.

Watch out: And if you're not careful, you could also be saying hello to fraud and abuse charges for therapy utilization changes, experts caution.

The Centers for Medicare & Medicaid Services has proposed a major change to the therapy threshold as part of its prospective payment system refinements rule issued April 27 and published in the May 4 Federal Register. CMS wants to do away with the 10-visit therapy threshold and use a staggered 6-, 14- and 20-visit threshold instead (see Eli's HCW, Vol. XVI, No. 16).

And CMS proposes even further payment differences for individual therapy visits within the six-to-13 and 14-to-19 visit case mix categories, explained consultant Mark Sharp in a May 17 audioconference on the PPS changes sponsored by Eli Research. That means agencies will receive more payment for every visit from six to 19, said Sharp, with BKD in Spring-field, MO.

Clarification: "Unlike the existing model, the proposed new case mix adjustment model does not lend itself to a simple explanation of the 'bonus' payment for reaching the therapy thresholds," the National Association for Home Care & Hospice explains in a rule summary for members. Therefore, "it is not feasible to compare the difference between today's increase in payment at 10 therapy visits with the proposed increase at 14 visits," NAHC advises.

Are You At Risk?

Agencies that currently have a wide distribution of therapy visits will have less financial and compliance risk under the revised PPS, predicts consultant and therapist Cindy Krafft with UHSA in Atlanta. Those with a concentration of episodes in the 10-to-12 therapy visit range and very few in the seven-to-nine visit range are more likely to face financial hardships under the PPS revisions, Krafft expects.

Gaming: CMS made the change because it thinks HHAs responded to current PPS reimbursement incentives--namely, the extra $2,000 or so received when a patient requires 10 or more therapy visits.

Many HHAs will find themselves in financial or compliance trouble because of this behavior, Krafft agrees. "Agencies could have avoided the problem from the very beginning by not trying to manipulate practice to increase reimbursement," she tells Eli.

But utilization changes aren't solely due to "agencies following the dollars," Sharp insisted. New initiatives such as outcomes-based quality improvement (OBQI) and Home Health Compare public reporting encourage increased therapy utilization. "All these things actually created a reason to get more therapy involved in our home health services," he said.

Fraud & Abuse Charges Threaten HHAs

The HHS Office of Inspector General has been targeting HHA therapy utilization for scrutiny under current PPS, notes Burtonsville, MD-based attorney Elizabeth Hogue.

And former intermediary auditor Tom Boyd is surprised intermediary medical reviewers haven't conducted more audits of therapy episodes under current PPS, he says.

Authorities will now be on the lookout for agencies to suddenly change therapy utilization in response to the proposed or final PPS therapy changes. "Now HHAs that were doing 10 to 11 visits have a problem, because an increase to hit 14 should cause medical review," predicts Boyd, consultant with Rohnert Park, CA-based Boyd & Nicholas. So will a decrease to six visits, he forecasts.

"If agencies try to turn [therapy utilization] on a dime, they are going to attract the attention of Medicare," Krafft stresses. "I think that is an intended impact of the changes."

And it won't just be CMS and intermediaries on your trail. The OIG is likely to continue its close inspection of therapy under the PPS refinements, Hogue says.

Danger zone: "If agencies modify their practice patterns measurably in response to changes in reimbursement, there are likely to be dire consequences," Hogue warns. "If it appears that utilization has increased in order to receive higher payments, it will be like a 'slam dunk' for fraud enforcers."

Hidden threat: HHAs that try to change therapy utilization drastically will also risk alienating their employees, Krafft points out. "Staff are going to be confused and frustrated."

What To Do Now

While the PPS refinements are still only proposed, you can be certain the therapy threshold change will become final is some similar form, experts agree. Here's what to do now to prepare for the change and safeguard yourself against reimbursement and compliance risks:

• Assess your current utilization. "Agencies need to look at the distribution of therapy visits," Krafft advises. Your therapy visits should be pretty evenly distributed over the utilization spectrum.

• Educate staff. If you find you have gaps in your therapy utilization, particularly in the seven-to-nine visit range, address the problem as soon as possible, Krafft urges. "I am not suggesting making anything mandatory," she explains. Instead, "really talk with the staff about the new system and why practice has to be focused on what the patient needs and NOT on the number of visits."

When staff start focusing their practice on patients and not utilization, "the distribution is there,' she believes.

• Monitor utilization. Wide swings in therapy visit numbers are bound to bring all kinds of scrutiny to your agency. "Undoing questionable practice patterns is a real issue between now and Jan 1," Krafft worries.

And the inspection will only heat up once PPS reforms actually hit. "Agencies should be very careful to monitor utilization after new changes are effective," Hogue counsels. The monitoring should "help ensure that utilization with regard to similar diagnoses does not increase substantially."