Reg's Blog

Senior and Post-Acute Healthcare News and Topics

SNFs, Therapy Contracts and Fraud: Another Warning and Example

I know I sound redundant but clearly, the message is still not permeating through the industry (except for readers here). The Department of Justice and the OIG for the Department of Health are scrutinizing SNFs, their therapy billings, and the use of therapy contractors.  Why?  It is all due to a known and now routinely validated, prevalence of over-billing and thus fraud and/or violations (same thing really) of the False Claims Act.  I have written on this subject on this site multiple times before and those that have heard me speak at various industry events, received the same message. Bottom-line: If you are an SNF and you use a contract therapy company to provide your therapy services, you must monitor the performance of your therapy contractor and assure that all Medicare billing and Condition of Participation requirements are being met.  The acts of the therapy contractor (over-billing, miscoding, improper care, etc.) are the “ACTS” of the SNF as far as the Federal government is concerned.  The SNF is responsible for ALL elements of care provided and the accuracy and compliance elements of any and all claims submitted to Medicare.https://rhislop3.wordpress.com/wp-admin/post.php?post=1138&action=edit#

In another case, recently disclosed, a group of three SNFs in New York (Arch Care) operated by Catholic Health Care System settled improper (false) claim allegations with the Department of Justice for $3.5 million.  The settlement is based on improper and inflated claims submitted to Medicare for unnecessary, erroneous and improper therapy care provided by RehabCare (a division thereof in this case).  The cause of the settlement or the crux of the issue related to the SNFs failure to monitor the therapy provider and to assure that the erroneous/illegitimate claims were not submitted to Medicare.  The result of the claims submission is overpayment and thus, the recovery and settlement.  Noticeably absent is any action taken against the therapy company by the Department as none such can be taken – the therapy contractor did not bill Medicare – the SNF did!

SNFs need to pay attention to these cases – more are assuredly forthcoming.  There are simple remedies to avoid these problems on the part of any SNF or group of SNFs.  Below is just a small sample.  For additional resources, attend the upcoming HcPro webinar that I  am conducting next week (posted on this site) or contact me directly.

  • Implement a triple-check system immediately.
  • If an SNF hasn’t audited its Medicare billings lately via an outside contractor, do so immediately especially if the SNF uses a therapy contractor.  Be prepared if irregularities are found to self-disclose.  Self-disclosure is required and it is the only way to potentially avoid treble damages, criminal liability, etc.
  • Retain an outside auditor and develop a routine audit system. I have checklists which can be used to guide in this process plus sources for auditors.
  • Educate your MDS and billing staff immediately on red-flag issues when it comes to your Medicare billings.
  • Integrate certain outcome and patient/resident/family feedback elements into your QA process.  Seek direct feedback monitor care outcomes and risk areas.

March 5, 2015 Posted by | Skilled Nursing | , , , , , , , , , , | 2 Comments