Home health, teaching hospitals under scrutiny
The home health industry and teaching hospitals can expect more attention from Medicare fraud investigators because of recent reports that they may be disproportionately responsible for the $23 billion that Medicare paid out incorrectly last year. If you work in those areas of health care, this may be the time to exercise extreme caution in billing.
In one report, the federal General Accounting Office (GAO) concluded that the home health care industry is not adequately monitored and may be benefitting from improper Medicare payments. The GAO reports that spending for home health care has increased from $2.7 billion in 1989 to $18 billion in 1996, with payments now going to 10,000 home health agencies instead of 5,000. Each month, another 100 home health providers receive permission to operate.
That sudden increase in home health may have eclipsed the ability of federal auditors to monitor payments from Medicare, the GAO investigators conclude. Surveyors often are unable to see patients or examine the home health provider’s performance personally, relying instead on examinations of paper records. Nevertheless, the rate of expulsions has increased recently. In 1996, the government expelled 0.3% of home health providers from Medicare participation, compared with 0.1% in 1994 and 1995.
Improper billing adds up
The improper billing in home health is thought to be a substantial part of the $23 billion in Medicare overpayments for 1996. Congressional leaders recently demanded that the Department of Health and Human Services (DHHS) devise a plan to recover the funds incorrectly paid to health care providers.
Sen. Tom Harkin (D-IA) called the overpayments "unconscionable" in a time when taxpayers are calling for a balanced budget and Medicare eligibility may be raised. He also suggested that the health care industry should pay for the necessary audits to find the misappropriated funds.
The $23 billion represents up to 14% of total Medicare spending for the year, much higher than the 10% of Medicare funds that previously were thought lost to fraud and abuse. The DHHS released a study showing that about one-third of all Medicare claims contained mispayments, averaging $670 in error per claim. The audit also showed that nearly half of all claims, 46%, were not properly documented. A third of all audited claims included payment for services that the later review found were not medically justified.
Cracking down on teaching hospitals
Teaching hospitals constitute another prime target for investigators. All across the country, teaching hospitals have submitted hundreds of thousands of dollars in fraudulent Medicare claims, according to a preliminary government investigation, and investigators say they won’t get away with it.
The investigation into 49 teaching hospitals has been going on for months, but the DHHS announced in July that its preliminary findings indicated widespread Medicare fraud. The probe will continue, with the exception of 16 hospitals that will be excluded from further study, according to Michael Mangano, principal deputy inspector general for the department. Those 16 hospitals were exempted because investigators determined that regional contractors for the Medicare program failed to provide them clear instructions on proper billing procedures.
Many of the teaching hospitals formed a lobby and called for an end to the investigation, gaining some support from members of Congress. Many of the Medicare rules were unclear, they argued, and teaching hospitals were being held accountable for interpretations that were not applicable when the claims were filed. Mangano denied that charge, saying the investigators excluded any hospital that seemed to have billed in good faith, even if current interpretations of the billing rules were different.
The University of Pennsylvania and Thomas Jefferson University, both in Philadelphia, already have paid a total of $42 million in reimbursement and fines for improper Medicare billing.
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