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Home Health Pre-claim review – August 1, 2016?

Yes – with less than 5 days to go – there is still significant debate about the Medical pre-claim review demonstration for Home Health Services. Last week the National Association for Home Care and Hospice submitted it’s comments to the OMB which argued that the proposed program should be withdrawn as it “falls short of what it takes to be an effective program integrity tool sufficient to offset the down-side risks to Medicare beneficiaries and upstanding home health agencies”.

Home Health Agencies have been under scrutiny due to the increase in improper payments from 17.3% (2013) to 51.4% (2014) and then to 59% in 2015. No – that was not a typo! 59% of claims submitted by home health providers to Medicare are estimated to not be payable, but have been getting paid. This in combination with some of the largest estimated Fraud, Waste and Abuse Vulnerabilities seen in some time, have led CMS to throw up their hands and say, ENOUGH, and implement the Pre-Claim Review Demonstration for Home Health Services.

In summary, Medicare has selected 5 at-risk states to test whether pre-claim review improves methods for the identification, investigation and prosecution of the rampant Medicare fraud occurring among Home Health Agencies.  The home health agencies will submit a request for a pre-claim review for each episode of care along with portions of the medical record that support the medical necessity of the services and demonstrate that the medicare coverage and coding requirements are met. The pre-claim program is slated to role out as follows:

  1. Illinois – August 1, 2016

  2. Florida – Estimated October 1st, 2016

  3. Texas – Estimated December 1st, 2016

  4. Michigan – Estimated January 1st, 2017

  5. Massachusetts – Estimated January 1st, 2017

Pre-Claim Reviews are optional – If Home Health Agencies in one of the demonstration states opts out of pre-claim review process, their claims will be stopped for prepayment review. In addition, after 3 months, CMS will reduce payment by 25% for claims that are deemed payable but did not first receive a pre-claim review decision.

Fast Facts about the over payments in Home Health claims:

  1. Over $10 billion in improper payments estimated in FY 2015.

  2. More than 350 criminal and civil action and $950 million in investigative receivables for FY 2011-2015.

  3. 310 individuals charged with approximately $900 million in false billing in June of this year!

  4. substantial number of providers-over 500 HHAs and over 4,500 physicians-that were outliers in comparison to their peers nationally with respect to multiple characteristics commonly found in OIG-investigated cases of home health fraud.

Further information about the Reviews are available at:

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