How the OIG Investigates Home Health Fraud in Detroit

Home health fraud within the Medicare Program has been pervasive for years. In fact, OIG home health investigations have resulted in more than 350 cases involving more than $975 million in claims. Areas such as Dallas, Houston, Miami, Los Angeles, and Detroit have experienced such high levels of suspected fraudulent activity that the federal government targeted those areas for HEAT Strike Force Teams. Along with the increase in enforcement activity, CMS has enacted moratoriums on new home health agencies in some of these areas. This brief article outlines how federal and state law enforcement agencies in Detroit review and investigate home health care claims.

Detroit Home Health Fraud Investigations

Despite these efforts to combat fraud, home health fraud is an ongoing concern. In 2015, the Medicare Program paid out an estimated $18.4 billion in claims with approximately $10 billion of that amount believed to be improper. In June 2016, HHS-OIG issued a report in which they detail the findings from their review of home health Medicare claims data for calendar years 2014-2015. A quick scan of the report reveals that more than 500 home health agencies, and 4,500 physicians were statistical outliers when viewed through the prism of the five characteristics commonly found in OIG investigated cases of home health fraud. Furthermore, based on these same characteristics, 27 cities in 12 states emerged as “hotspots” for home health fraud. Detroit is one of them.

Detroit Law Enforcement Is Looking for These Signs of Fraud

While most healthcare fraud cases involve, in some form or fashion, the billing of services that are not medically necessary or provided, OIG has discovered that cases involving home health agencies seem to share five common characteristics. The five characteristics common to home health fraud are:

1. Many episodes for which the beneficiary had no recent visits with the supervising physician.
2. Many episodes that were not preceded by a hospital or nursing home stay.
3. Many episodes with a primary diagnosis of diabetes or hypertension.
4. Most beneficiaries with claims from multiple home health agencies.
5. Many beneficiaries with multiple home health readmissions soon after.

To be considered one of the suspicious providers identified in the OIG report a home health agency or physician needed to be an outlier in two or more of the five common characteristics.

How OIG Analyses Detroit Home Care Agencies

When discussing the findings for home health agencies and physicians, the OIG report identifies the national average for providers relating to each of the characteristics and provides a threshold percentage for providers identified as outliers. Put simply, the report shows the average number of claims (%) a typical provider has with one of the specific characteristics and compares it to the outlier providers. For example, the national average for home health agencies that have patients with no recent visit from the supervising physician is 22.6% of the claims. The threshold for outliers on this same characteristic was 62.5%.

Through the application of the five characteristics, the OIG identified 500 home health agencies and 4,500 physicians as suspicious. But why these five? What do these characteristics show and is there anything that the OIG is not saying about them? To figure this out we can look at the report and see what the OIG says, then maybe read between the lines and see if there is any other information we can discern.

• The first characteristic common to home health fraud is that the home health agency submits most claims with no recent visits shown by the supervising physician. The OIG defines “recent” as the preceding 6 months to the home health claim. A visit by the supervising physician is shown by a claim submitted for an evaluation and management service by the physician (an E&M code or 99000 series). According to the OIG, the characteristic indicates that the supervising physician possibly did not properly evaluate the patient’s medical condition and the home health service may not be medically necessary. Under this characteristic the OIG mentions that home health agencies regularly pay recruiters to collect patient information and the supervising physicians collude with the home health agency in the execution of the scheme.

• The second characteristic identified by OIG is the home health agency submits most claims that were not preceded by a hospital or nursing stay. For this characteristic the OIG looked at the 30-day period before the home health claim (I told you cross claims would come up again). The OIG states that this may mean that the home health service is not medically necessary. What the report does not mention is that this can also demonstrate kickbacks to patients and is tied to the use of recruiters, much like the first characteristic.

• The third characteristic identified by OIG was the high number of home health claims submitted with a primary diagnosis of diabetes or hypertension. OIG believes this points to services that are not medically necessary. Diabetics are attractive clients for home health agencies because they agency will send an employee to the patients home twice a day to simply test the patient’s blood sugar. While the patient typically can do this themselves, the home health agency can increase their reimbursement by billing for unnecessary twice a day services. Because the blood sugar check is a service the patient can usually do themselves, this is another situation where the patient may be offered money as an incentive to use the home health agency.

• Characteristic number four involves a high number of patients with claims from multiple home health agencies. To determine this metric, the OIG looked at patients that had received home health care from three or more home health agencies over two years. This characteristic is typical in cases when recruiters moved beneficiaries between home health agencies, most of the time because the recruiter is being paid by multiple agencies and will switch the patient to the agency paying the most.

• The final characteristic relates to claims for multiple home health readmissions soon after. This would involve a patient being qualified for home health, taken off after a time, then readmitted. This supports a belief that the service being rendered is not medically necessary and that the agency is trying to cover up the duration of the care.

Home Health “Hotspots” and Continued Enforcement

The five characteristics used to identify suspicious agencies and physicians was also applied geographically to determine whether there were any regions of the country that were aberrant in the billing of home health services. As stated above, the report identified 27 cities in 12 states where the common characteristics of home health fraud were prevalent. According to the report, 35% of all home health episodes and 37% of all home health spending occurred in these hotspots.

Several hotspots were previous targets of HEAT Strike Force Teams. These cities include Chicago, Dallas Detroit, Houston, and Miami. Despite the number of successful prosecutions and millions of dollars recovered, large volumes of home health claims still come out of these cities. While some hotspot locations had been on the government’s radar other cities were not. The OIG report identified several locations that had never been the focus of any anti-fraud efforts. These cities include Las Vegas, Orlando, San Diego, Phoenix, Provo, and Ada (Oklahoma).

In their conclusion, OIG stresses that the report turned on data analysis and that no medical records or other documentation was reviewed. Yet the report does state OIG will conduct investigations and audits of the home health agencies and physicians identified as outliers and refer the providers to CMS for follow up. Further, OIG recommends that enforcement and program integrity efforts (read UPIC) should continue in those hotspots already targets of HEAT activity and hotspots not previously identified warrant the dedication of more investigative resources and attention.

UPIC Audits and Other Investigations in Detroit

This report was issued in June 2016. That was barely six months ago. Medicare paid over $18 billion for home health services in 2015 and 54% of that is estimated to be improper. OIG believes home health is a major problem despite all the enforcement actions taken thus far. That belief is because home health agencies stay statistically aberrant, including in cities where heavy enforcement has already taken place.

If you are a home health agency or a physician who often refers patients to home health, understand that, based on this report, your practice may receive intensified scrutiny. The OIG report turned on data and, because of this, the OIG repeatedly stated the report should not be interpreted as showing fraud. To support a finding of fraud the OIG, or more likely a UPIC would need to review medical records. This means that auditors and investigators may arrive at your door asking for records and talk to employees. Finally, if you are a home health agency in a city that has experienced the intense enforcement efforts of the HEAT Strike Force Team, prepare yourself to be audited as well.

The June 2016 report issued by OIG puts home health providers on notice that their line of business is still problematic within the Medicare Program and that enforcement efforts are still necessary. If you are a home health provider experiencing your first audit, realize that information contained in OIG’s report is the likely reason why. Providers that find themselves in this position should know that OIG and UPICs have the authority to access the medical records that support the services billed. Refusal to provide reasonable access to the medical records could result in a payment suspension. Reasonable access can mean enough time to make copies of the requested records and provide later. Providers should also be aware they need not have any of their staff interviewed at the time the records are requested. Providers in this situation should always try to find an attorney with experience dealing with Medicare investigations, no matter if it is initiated by OIG or the UPIC for their region.

Former Medicare Prosecutors & Experienced Attorneys Can Help You

Oberheiden, P.C. consists of former Medicare fraud prosecutors and law enforcement personnel that have specific experience with hundreds of healthcare investigations. Our combined experience of decades in charge of Medicare and Medicaid investigations helps our clients to better understand what government lawyers are looking for when reviewing healthcare data and contemplating possible criminal charges. Providers and business owners in Detroit should contact one of our senior attorneys for a free and confidential consultation.