Home Health Care Group to Congress: Reform Medicare Payments to Combat Fraud

One way to cut down on Medicare fraud in the home health care industry is to reform the payment system and get rid of the “pay and chase” model, says national industry coalition the Partnership for Quality Home Healthcare in response to the Senate Finance Committee’s solicitation for recommendations that can strengthen the integrity of the Medicare and Medicaid programs.

“Fraud and abuse have long plagued the Medicare and Medicaid programs, and although traditional efforts to curb such problems have had a measurable effect, bad actors continue to find a way to enter virtually every segment of these programs, prey on beneficiaries, and make off with billions of taxpayers’ hard-earned money,” said the Partnership in a letter to the Senate Finance Committee. “Partnership members have been working together for more than a year to develop policy solutions that we firmly believe will effectively combat fraud and abuse in the Medicare and Medicaid programs.”

The Partnership’s package of suggestion reforms, the “Skilled Home Healthcare Integrity and Program Savings” (SHHIPS) proposal, includes provisions to get rid of the possibility of overpayments by preventing payment of “aberrant” claims before making them, and strengthening the claims review processes, along with bolstering the conditions and standards of participating in the Medicare program.

The key to cutting down on fraud is to target where it’s most frequently occurring, and most of the false claims are isolated in a few select areas in the U.S., according to MedPAC data. The Partnership lists Medicare claims data that reveals 60% of all the abuse in the home health care relating to Medicare outlier claims in 2009 happened in just two of the nation’s 3,143 counties.

Payment reforms included in the industry coalition’s letter to the Senate Finance Committee are modeled on an existing program change that was proposed in 2009: a 10% cap on Medicare outlier claims, which could serve to stem aberrant billing practices” often a sign of unchecked fraud and abuse.

“By preventing aberrant claims from being paid in the first place, home health care providers successfully piloted the replacement of the troubled “pay and chase” practice with a simple and logical “˜aberrant payment prevention’ mechanism,” the group says.

This proposal has been adopted as part of the Affordable Care Act and is estimated to have saved $853 million in 2010 alone, and an estimated $11 billion in the next ten years.

View the full letter to the Senate Finance Committee to read more about the Partnership for Quality Home Healthcare’s recommendations for Medicare payment reform.