On February 28, the Department of Justice held press conferences and press releases to provide information to the public about the conclusion of their two year investigation into alleged fraudulent activities of Dr. Jacques Roy and his associate with Medistat, a physician practice located in Dallas. According to the Federal authorities, this case exposed a conspiracy to defraud the Center for Medicare Services, and the taxpayers of the US, in an amount totaling over $375 million. Besides the specific allegations regarding Dr. Roy and Medistat’s activities and fraudulent processes, this news also implicated several individuals and three home health agencies all named in the indictment, plus the government announced that they have suspended payments to 78 agencies in the Dallas market, who are involved in this alleged wide ranging ‘485’ factory. Apparently the government utilized a benchmark percentage of the number of patients that Dr. Roy and Medistat had certified over the proscribed time period in order to single out which agencies were to be targeted to have their Medicare payments suspended.

The 78 home health agencies that have had their payments suspended bear the burden of proof – to provide rebuttals, supported by detailed documentation, to appeal the suspension of payments for their legitimate services provided to patients certified by Dr. Roy.

This unfolding story warrants sincere consideration by all home health agencies involved in Medicare certified business, so that a couple of questions emerge…

• What are the lessons to be learned from this unfortunate incident?
• What steps can other home health agencies take to protect their businesses?

Our consulting team has identified FIVE MAJOR LESSONS that we offer to help you navigate the dynamic marketplace of the future.

Five Lessons Learned from the Alleged $375 Million Medicare Fraud Case:

Diversify your Lines of Business

Home health agencies that are fully dependent on Medicare reimbursement operate with a degree of risk associated with having a single source of revenue. Care must be taken to not be just a “one trick pony”. “Thinking-out-the-box”, a validated entrepreneurial skill, is essential for the highly effective home health agency. Consider alternative payments sources including private insurances and private pay.

Seek and Maintain Multiple Physician Referral Sources

Market your agency to several different clinics, physician practices, hospitals. This should be second nature. Your marketing efforts will naturally flow towards those clinics and physicians within your immediate area and sphere of influence. Effort must be taken to expand your reference points. Get to know new clinics, and seek out ways to meet new physicians, who need to find excellent home care services for their patients. Orthopedic doctors, surgeons, and family practice doctors can be excellent sources of referral. Make sure you track the referral sources. One specific way to explore your existing exposure to concentrated referral sources is to run a report of referrals, by physician. The percentages shown therein will expose you to the relative need for certification diversity. Users of Axxess’ Agencycore complete home health software can run a report of referral sources and generate the percentage of the total referrals by their source.

“Document, Document, Document”

As the popular saying goes in the health care business, “if you didn’t document it, then you did not do it”. After obtaining a proper care plan signed by the supervising physician, home health agencies must document the care provided on each visit in strict accordance with the established plan of care. Each progress note must provide overwhelming evidence of medical necessity for the care provided. There must be documentation of effective care coordination among all the disciplines involved in caring for the patient. Documenting your referral sources is critical. In the Dr. Roy story, 78 home health agencies have had their payments suspended because according to the CMS; they had an unusually high number of patients being seen by the physician. In some of the cases, the referrals may have come from other sources. The affected home health agencies have been asked to submit rebuttals to the fraud allegations and it will be very important for them to prove that they had no improper relationship with the physician. Essentially, ensure you document all care and communication involved with all your patients.

Provide Ongoing Training for your Staff

Educate your staff regularly regarding regulatory requirements and provide ongoing training on special compliance standards and policies. Encourage your staff to attend educational seminars/webinars to understand various aspects of home health operations. Axxess is holding a series of home health seminars nationwide that your staff can benefit from. In addition, encourage your staff to master your agency’s home health software platform so you are getting the most of your investment. Axxess, provides unlimited training and support to assure that each member of your staff is progressing in their pursuit of mastery.

Educate your Homebound Patients

With organizations like Zone Program Integrity Contractors (ZPICs) and Recovery Audit Contractors (RACs) performing investigations and audits of home health activities nationwide, home health agencies need to educate their patients on the reasons why they are on service and insurance coverage for services provided. Your patients can be educated that if and when a surveyor asks them to be interviewed, that they request the interviewer/investigator’s proper ID, and notify the home health agency immediately of the visit. Specifically, help your patients to understand the definition of “home bound”, and why home healthcare is of necessity, according to CMS Regulations. If home care patients have a clear understanding of why they are receiving the benefits of Medicare home care, they will be able to be interviewed more effectively, and assist your agency in providing accurate responses to the investigators.