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OIG releases its FY 2015 mid-year update

OIG releases its FY 2015 mid-year update

The Office of Inspector General (OIG) released its fiscal year (FY) 2015 Mid-Year Update last week. The update summarizes new and ongoing reviews and activities that OIG plans to pursue with respect to HHS programs during the current fiscal year and beyond.

The OIG’s job is to detect fraud, waste, and abuse; identify opportunities to improve healthcare program economy; and to hold "accountable those who do not meet program requirements or who violate Federal health care laws." The OIG conducts audits and investigation, and can impose civil monetary penalties where appropriate, so its Work Plan is often of great interest to those working with federal healthcare programs. As a summary of some of the OIG’s enforcement initiatives, the Work Plan can serve as a useful resource for companies when training and when planning internal audits. 

The FY mid-year update includes several initiatives central to long-term care providers.


Medicare Part A billing by SNFs

The OIG will describe changes in SNF billing practices from FYs 2011 to 2013. Prior OIG work found that SNFs increasingly billed for the highest level of therapy even though beneficiary characteristics remained largely unchanged. The OIG also found that SNFs billed one-quarter of all 2009 claims in error; this erroneous billing resulted in $ 1.5 billion in inappropriate Medicare payments. CMS has made substantial changes to how SNFs bill for services for Medicare Part A stays.

CMS’ future plans include:

  • phasing in bundling options
  • continued growth and development of ACO models of reimbursement tied to outcomes and quality of care
  • the elimination of using the amount of therapy delivered as an incentive for payment
  • conducting outcome studies on therapy delivered under Medicare Part B


Diane Brown, director of postacute education at HCPro explains that, "These plans will likely contribute to better care and improved transitions in care as well as be linked to appropriate payment. When implemented, much of the time spent by facilities on navigating COTs and other labor intensive tasks could be eliminated."

As Kathy W. O’Neal, RN, RAC-CT, LNHA, from Crossroads Medical Management can attest to, "There were numerous changes with Part A billing practices associated with the implementation of MDS 3.0. Probably the most significant was that on the five-day assessment, projecting therapy minutes were removed. Another significant change is that a change of therapy (COT) assessment is required every seven days if a resident in a rehab RUG category that receives more or less therapy minutes and/or the number of modalities changes enough to cause the resident to fall into another RUG category. This practice was created as a response to the thought process that SNFs were being paid for a therapy that was not needed and/or provided. These changes have created a tremendous increase in the number of assessments needed, with the resulting billing rules associated that are confusing for providers. A large percentage of my time is consumed with audits and appeals associated with Part A stays, mainly Medicare replacement policies, and often it seems that the insurance companies providing the replacement policies do not understand PPS billing. It is very frustrating but has become a routine part of our industry."


State agency verification of deficiency corrections

The OIG will determine whether state survey agencies verified correction plans for deficiencies identified during nursing home recertification surveys. A prior OIG review found that one state survey agency did not always verify that nursing homes corrected deficiencies identified during surveys in accordance with federal requirements. Federal regulations require nursing homes to submit correction plans to the state survey agency or CMS for deficiencies identified during surveys. CMS requires state survey agencies to verify the correction of identified deficiencies through on-site reviews or by obtaining other evidence of correction.


Program for national background checks for long-term-care employees

The OIG will review the procedures implemented by participating states for long-term care facilities or providers to conduct background checks on prospective employees and providers who would have direct access to patients and determine the costs of conducting background checks. Further, the OIG will determine the outcomes of the states’ programs and determine whether the programs led to any unintended consequences. Section 6201 of the Patient Protection and Affordable Care Act (ACA) requires the Secretary of Health and Human Services to carry out a nationwide program for states to conduct national and state background checks for prospective direct patient access employees of nursing facilities and other long-term care providers.

The program is administered by CMS. To carry out the nationwide program, CMS has issued solicitations for grant awards. All states, the District of Columbia, and U.S. territories are eligible to be considered for a grant award. OIG is required under the ACA to submit a report to Congress evaluating this program upon its conclusion. This mandated work is ongoing, and an interim report will be issued prior to the program’s conclusion.

O’Neal approves of this initiative, saying that, "I agree with any additional background screening to ensure our residents are cared for in a safe and caring environment."

Although the OIG’s oversight extends to other programs under the U.S. Department of Health & Human Services, the majority of its resources go toward combating fraud, waste, and abuse in Medicare and Medicaid.

You can review the entire mid-year update to the 2015 Work Plan on the OIG’s website. – Billing Alert for Long-Term Care