Breaking Compliance News Blog

In March 2018, the OIG issued Report A-05-14-00041, Many Medicare Claim for Outpatient Physical Therapy Services Did Not Comply with Medicare Requirements. 

The OIG reviewed 300 random Medicare outpatient PT claims for services provided between July and December of 2013.

Based on its review, the OIG found:

• 61% of outpatient Medicare PT services did not comply with Medicare requirements.
• Medicare paid an estimated $367 million for these services.

The OIG identified three types of claims errors: medical necessity, coding, and documentation. Here is a breakdown of the errors by type:

Medical Necessity Errors (91 claims out of 300)

• 98%: Services not reasonable
• 33%: Services not effective
• 31%: Services did not require the skills of a therapist
• 29%: No expectation of significant improvement

Coding Errors (145 claims)

• 59%: Timed units claimed did not match units in treatment notes
• 54%: Missing modifiers
• 41%: Incorrect codes

Documentation Errors (112 claims)

• 71%: Plan-of-care deficiencies
• 66%: Treatment note deficiencies
• 8%:  Recertification deficiencies

Providers of outpatient physical therapy can expect increased claims monitoring by CMS, as well as more education from CMS.

Same song different tune?

 While this review focused on outpatient physical therapy provided in an office setting, the OIG has similar concerns about therapy provided in nursing homes.  A 2012 OIG report found errors involving coding, medical necessity, and documentation in SNFs.

In November 2012, the OIG released a report: Inappropriate Payments to Skilled Nursing Facilities Cost Medicare More than a Billion Dollars in 2009.    

The OIG found that 25% of all SNF Medicare claims were erroneous. The errors included:

• 20.3%: Claims with an inaccurate RUG (upcoded). In 57% of these claims, SNFs provided more therapy on the MDS than was documented in the medical record; and 25% of these claims involved therapy listed in the medical record that was not reasonable and necessary
• 2.5%: Claims with an inaccurate RUG (downcoded)
• 2.1%: Claims that did not meet Medicare coverage requirements (e.g. no physician order)

The OIG also found that 47% of claims involved inaccurate MDS information. The primary reporting error was the amount of therapy received or needed, followed by special care, ADLs, oral/nutrition status, and skin conditions/treatment.

What you can do

The takeaway here is: whether you are providing outpatient therapy, skilled nursing therapy – or another Medicare service involving therapy – medical necessity, documentation and coding errors remain common errors of OIG concern. Incorporating these items into your regular compliance audits will help you find and correct errors internally and improve claims accuracy.

Chemed Corporation, Vitas Hospice Services LLC, and Vitas Healthcare Corporation entered a $75 million settlement with the government to resolve false claims allegations. Vitas, the biggest for-profit provider of hospice services in the nation, allegedly “knowingly submitted or caused to be submitted false claims to Medicare for services to hospice patients who were not terminally ill” between 2002 and 2013. The DOJ also accused Vitas of awarding bonuses to employees based on the number of patients on hospice, regardless of need.

In addition, Vitas was accused of billing Medicare for continuous home care services that were not necessary, not provided, or did not meet Medicare requirements. Like with hospice services, Vitas allegedly set corporate goals for billing continuous home care services, regardless of patient need.

According to the Complaint, “Vitas regularly ignored concerns expressed by its own physicians and nurses regarding whether its hospice patients were receiving appropriate care.” Complaint, page 3. The Complaint also says the company’s own auditors knew of the problem – but changes were not made.

Let’s look at the data

PEPPER (Program for Evaluating Payment Patterns Electronic Report) reports for Q4FY14 have been released--a few days ahead of schedule! You can access your PEPPER online.

This latest PEPPER uses statistics through September 2014, and will be available for download for approximately two years.

To download your PEPPER, the CEO, President or Administrator of the SNF needs to:

1. Visit the PEPPER Resources Portal
2. Enter your information. You will need a Patient Control Number (form locator 03a on the UB04 claim form) *or* a Medical Record Number (form locator 03b on the UB04 claim form) for a claim of a traditional fee-for-service (FFS) Medicare patient/beneficiary who was receiving services at this provider between September 1 - 30, 2014 (“From” or “Through” date on the claim is between September 1 - 30, 2014).
3. Download your PEPPER.

If you need help, review the Secure PEPPER Access Guide.

Not a SNF?

PEPPER might still be coming soon:

 And, for the first time in 2015, PEPPER will be released for home health (expected in July).

Now what?

Learn more about how to use PEPPER as part of your compliance program's auditing strategy.

The United States Department of Justice recently entered a $500,000 settlement with an Iowa skilled nursing facility, to resolve allegations that the SNF billed the government for improper therapy provided by a third party therapy services contractor.

The latest Program for Evaluating Payment Patterns Electronic Reports (PEPPER) reports for SNFs, from 4^th Quarter 2013, have been available since May 5. As of June 30, only 49% of SNFs have accessed their PEPPER reports. Are you one of the 49%?

SNFs can now access their PEPPER (Program for Evaluating Payment Patterns Electronic Report) for 4^th Quarter 2013 online.

CMS Program for Evaluating Payment Patterns Electronic Reports (PEPPER) reports will be released soon. PEPPER is a Medicare Part A claims data report that compares your SNF to state, national and MAC or FI jurisdiction data. PEPPER includes this comparative data for six Target Areas:

On January 31, the OIG released its Work Plan for Fiscal year 2014 (which began on October 1, 2013). The Work Plan sets out the items the OIG will be reviewing during this fiscal year—and is a great tool to help Compliance Officers direct their compliance audits.

The work plan is about 100 pages, but don’t let that overwhelm you. It covers the entire health care industry, so the key is to find the pieces that apply to your organization. For example, the following items pertain to Nursing Homes: