CMS recently announced a delay in the broad implementation of a stricter review program for Medicare home care claims that launched on a demonstration basis on August 3, 2016.  CMS began the demonstration program to test whether a pre-claim review system would improve the identification, investigation, and prosecution of Medicare fraud occurring among home health agencies (HHAs) providing services to Medicare patients.  CMS stated that the demonstration would not “create new clinical documentation requirements” and that HHAs would submit the “same information they currently submit for payment,” but would do so “earlier in the process.”  Additionally, CMS stated it would be looking at whether this process would help reduce expenditures while maintaining or improving the quality of care provided by the HHAs.

On June 9, 2016, CMS announced that testing would begin in Illinois, with Florida and Texas to follow later in the year.  CMS had planned to expand the pre-claim review program to Massachusetts and Michigan starting in 2017.  Following the announcement of the program, the National Association for Home Care & Hospice (NAHC) warned CMS of problems with the pre-claim review program, specifically that it would violate the “standards of reasonableness, economy, and efficiency,” with “high administrative costs and operational burdens” and  would be “likely to create improper barriers to access to timely care.”  Senator Bill Nelson and Senator Marco Rubio also expressed concern in a letter addressed to CMS on September 1, 2016, stating that the pre-claim review demonstration may “restrict beneficiary access to timely services, divert clinical resources to paperwork management, and incur high administrative costs.”

Despite concerns regarding implementation of the demonstration, on August 3, 2016, CMS began the pre-claim review demonstration in Illinois.  The initial reports since implementation of the program have not been positive.  NAHC has referred to the program as “chaos,” and others have stated that the program has been “atrocious” for providers.

As a result, CMS announced on September 19, that “[b]ased on early information from Illinois, CMS believes additional education efforts will be helpful before expansion of the demonstration to other states; therefore, we will not move forward with initiating the demonstration in Florida in October.  This education effort will focus on how to submit pre-claim review requests, documentation requirements, and common reasons for non-affirmation.”  CMS says it “views these efforts as crucial to the long-term success of the demonstration for beneficiaries, providers, and the Medicare program.”

The new start dates for Florida, Texas, Michigan and Massachusetts have not been announced; however, CMS stated it will provide at least 30 days’ notice on its website prior to the program beginning in any state.  To view CMS’ update and information regarding the program in its entirety, click here.