Home Health & Hospice Week

The target once again: high-therapy claims.

Tighten up your therapy claims oversight or you could lose thousands of dollars per episode.

A small Chicago-based home health agency is facing that fate following an audit by the HHS Office of Inspector General. Pacific Home Health Care Inc. was overpaid $108,849 for therapy and skilled nursing services claims that did not comply with federal requirements, contends an OIG report released Oct. 18.

"We are contesting the findings," Pacific's ad-ministrator, Leticia Jimenez, tells Eli.

Don't let this happen to you: Months after Pacific secured its Medicare provider number, the OIG selected Pacific "at random" for medical review of its therapy claims, explains Jimenez. A medical record review performed by TriCenturion, a Medicare program safeguard contractor, determined that 51 of 100 sampled claims with 10 or more therapy services were inappropriately paid because they were:

• not reasonable and medically necessary;

• not provided as ordered by the physician;

• not supported by documentation in the medical record; and

• based on incorrect payment codes, which resulted in lower allowable reimbursement.

In addition to seeking repayment of the $108,849 in claims deemed inappropriate, the OIG asked Pacific to work with Palmetto GBA, its regional home health intermediary, to "identify and adjust claims for Medicare overpayments received subsequent to the audit period."

The claims audited so far were from 2002 and 2003. That means Pacific faces further scrutiny of about three years' worth of claims since the audit -- and possibly thousands more in overpayment charges.

Know If You're A Likely Target

Beware: Agencies that have a high number of claims that included 10 to 12 therapy visits per episode may be particularly at risk for medical review and subsequent overpayment recoupments.

For the audit period in the OIG report, Pacific submitted and was paid for 123 home health claims that included one or more therapy visits, the report notes. Of those, 100 claims met the 10-visit threshold, totaling $456,637 in Medicare reimbursement.

That level of high therapy claims is in keeping with a high level of referrals from the local Veterans Administration medical center, Jimenez explains.

Lesson learned: More pre-billing controls could have helped Pacific steer clear of trouble, experts say.

"There are vital steps that agencies need to take to ensure appropriate payment for therapy," says M. Aaron Little of BKD in Springfield, MO (see related story, in this issue).

In the OIG's own words: "The overpayments occurred because Pacific did not have effective quality assurance and control policies and procedures to identify whether the claims including therapy visits were appropriately billed."  

Note: The OIG report is at www.oig.hhs.gov/oas/reports/region5/50400103.pdf.