Issues of fraud in the hospice industry echo events that previously affected the home health space, and providers can learn from that prior experience.
This is according to Bill Dombi, president of the National Association for Home Care and Hospice (NAHC), who spoke Thursday in a Relias webinar. In response to emerging program integrity concerns, the U.S. Centers for Medicare & Medicaid Services (CMS) this year introduced a number of new regulations, many of which were modeled after some in place for home health agencies and skilled nursing facilities.
“What I’m seeing is history repeating itself. Back in the 1990s, the microscope ended up focusing on the Medicare Home Health Program. Allegations of fraud, waste and abuse were just among some of the issues that were out there,” Dombi said in the webinar. “The hospice community has learned from that home health experience, jumping into the fray with integrity.”
Much of the regulatory activity was spurred by a rash of new providers that have emerged so far in four states: California, Arizona, Texas and Nevada. A large contingent of these companies were established with the purpose of selling the license at a profit, with little concern for patient care.
Many of these hospices were setting up shop, providing substandard care to a few patients and then selling off the license before regulators caught wind of it. This prompted CMS to finalize a rule that would prohibit hospices from selling licenses or transitioning ownership for at least 36 months following initial Medicare certification, which mirrors a regulation that has existed for several years for home health agencies.
CMS allows four exceptions to the 36-month requirement:
— The hospice submitted two consecutive years of full cost reports since initial enrollment or the last CIMO, whichever is later.
— The hospice’s parent company is undergoing an internal corporate restructuring, such as a merger or consolidation.
— The owners of an existing hospice are changing the hospice’s existing business structure (for example, from a corporation to a partnership, general or limited), and the owners remain the same.
— An individual owner of a hospice dies.
A related clause in the rule would deactivate the Medicare certification of providers that do not bill Medicare after six months of providing services.
“Tightening the enrollment standards on the hospice-specific side, putting some enrollment rules in there regarding changes of ownership and screening of organizations’ management in terms of their bona fides is an extension of something that’s been in home health — the 36-month rule to prevent that churning of ownership,” Dombi said. “That means you really are not so focused on care as you are focused on buying and selling.”
A second major development set to begin in the new year is CMS’ new Special Focus Program (SFP) for hospices.
If designed similarly to those used in other settings, the SFP would have the power to impose enforcement remedies against hospices with poor performance on regulatory or accreditation surveys. Hospices flagged by the SFP would be surveyed every six months rather than the current three-year cycle. Similar programs exist for home health agencies and skilled nursing facilities, according to Dombi.
The program would have the authority to impose fines, suspend reimbursement, appoint temporary management to bring the hospice into compliance or revoke a provider’s Medicare certification altogether.
Though the hospice community generally has voiced support for the program, many contend that the agency’s methodology for identifying hospices for the SFP is deeply flawed. Stakeholders, including hospice providers and members of Congress, have called on CMS to postpone the program and revise that algorithm.
“The SFP that came out from the final home health rule is not acceptable as designed. Now, it doesn’t ferret out a distinction between high-quality and low-quality providers of services for purposes of assigning that enhanced oversight,” Dombi said. “So we’re trying to convince CMS to modify that without congressional allies joining with us on that.”
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