Intermediaries step into middle of referral puddle
Intermediaries step into middle of referral puddle
By Elizabeth Hogue, JD
Health Care Attorney
Elizabeth Hogue Chartered
Burtonsville, MD
As if Operation Restore Trust or the Balanced Budget Act of 1997 weren’t enough to give hospitals and their affiliated home care agencies the willies, now Medicare intermediaries are starting to look scary.
Some intermediaries recently have started examining the process for referring patients in hospitals and long-term care facilities for home care services. They have begun to apply a standard that home care agencies must follow, or risk denial of costs associated with the coordination of home care services. Or worse.
In this time of heightened sensitivity regarding fraud and abuse, agencies must consider carefully the implications of continuing to claim the costs of coordination on cost reports. When HHAs claim such costs and do not meet the standards established by the intermediary, they risk not only disallowances, but possible action on the basis that the nonallowable costs submitted for coordination activities amounted to a false claim.
The standard requires home care agencies to demonstrate the following steps are taken in sequence:
1. Physicians order home care services.
2. Orders from physicians for home care services are documented in patient’s medical records.
3. Patients select the home care agency of their choice.
4. Discharge planners contact the home care agency of the patient’s choice to communicate the referral.
5. The agency staff begin the process of coordination of home care services only after all of the above steps have been completed.
Some intermediaries have taken the position that if this sequence is not followed, then the costs of any coordination activities that occur prior to completion of steps 1-4 are not allowable costs on agencies’ cost reports.
The intermediaries’ position on this issue is based, in part, on the following section of the Provider Reimbursement Manual:
"The cost of coordination activities [for] the patient’s transition from hospital or SNF to the home under the care of an HHA are allowable. Coordination activities take place once the patient’s physician has determined that the patient requires home health services as evidenced by the patient’s medical record and the specific HHA that is to render the services has been chosen by the patient or his family (possibly with hospital or SNF assistance). The cost of activities performed prior to the determination that home health services are needed and the selection of one HHA to perform the services is not an allowable home health cost since an agency cannot coordinate the care of a nonpatient." (Part I, Sec. 2113.)
However, from the point of view of many providers, this sequence is difficult, if not impossible, to achieve because physicians and discharge planners may not know enough about appropriateness of home care services to make a determination regarding the services needed. The contribution of HHA staff members has often been crucial to the development of an appropriate discharge plan for patients who meet the requirements of the Medicare home care benefit.
Moreover, providers may rely on the following section of the Provider Reimbursement Manual to support their position that consultation apart from the sequence described above may be appropriate:
"Education and liaison activities permit the HHA to establish ties with the rest of the health care system. These activities are allowable to the extent that they are necessary for patient care and do not duplicate services which are or should be performed by the hospital or SNF. The activities include:
A. Serving as an educational resource to the hospital or SNF concerning home health services. This includes conducting training for hospital or SNF staff and serving as a consultant to the hospital or SNF for establishing home care policies and practices.
B. Educating physicians concerning the range of home care services available." (Part I, Section 2113.4)
Providers also may take the position that the sequence established by some intermediaries is inconsistent with JCAHO standards. As many providers already know, hospital surveys by JCAHO can result in so-called "deemed status" for hospital participation in the Medicare and Medicaid programs.
JCAHO requirements indicate that hospital discharge planners must consult with physicians, patients, and family members of the patient to develop an appropriate discharge plan. JCAHO standards do not require discharge planners to get the advance approval of physicians in the form of an order placed in patient’s charts to develop and implement an individualized discharge plan.
In addition, agencies may take the position that the language of Part I, Sec. 2113 does not require a physician’s order. The consultation that occurs between discharge planners and patients’ physicians is sufficient to meet the requirements of this section.
What you can do
In view of the potential for disallowances, providers should take the following action:
• Agencies should work with discharge planners to implement the sequence described above. Because discharge planners must consult with physicians to develop a discharge plan, one way to achieve this goal may be to ask discharge planners to document approval by the physician during their discussions on the patient’s chart.
• After patients select an agency, the discharge planner could provide agencies with a copy of this documentation of approval by the patient’s physician when making a referral to the home health agency.
The recent position taken by some intermediaries regarding disallowances for coordination activities is yet another example of the ever-changing landscape of Medicare regulation as it relates to hospital-affiliated home care agencies. As always, agencies must be flexible and ready to adapt to such new interpretations.
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