Medicaid Fraud Control Units Report Focus on Personal Care Services

by Ruder Ware
The Department of Health and Human Services (HHS) Office of Inspector General (OIG) has released a report summarizing activities of State Medicaid Fraud Control Units (MFCUs or Units) for fiscal year 2016.  The OIG is the designated Federal agency for oversight of state MFCUs.  The report found a total of 1,564 convictions of which approximately one-third involved personal care service attendants.  Personal care convictions included prosecution of personal care attendants, agency representatives, and home care aides.  The report also identified 998 civil settlements and judgments and nearly $1.9 billion in civil and criminal recoveries.

Around one-fourth of the convictions related to fraudulent billings and other fraud issues.  Another quarter of the convictions involved patient abuse or neglect, including patient assault occurring in long-term care facilities.  The focus on the personal care industry is highly problematic because personal care agencies are often smaller, local businesses operating on relatively thin margins.  Personal care businesses generally involve a nurse that has supervision authority over personal care workers.  Personal care workers may be assigned to provide basic care to a small group of patients in their homes.  Sometimes the personal care worker is even a resident in the home of the patient and may be a distant relative of the patient.  Smaller organizations may not have the resources to proactively deal with compliance issues.  At the same time, there are numerous areas of compliance risk in the personal care business.  Some risk areas that might catch the attention of personal care businesses include:

  • Personal care workers must be appropriately qualified and trained.  Verification of qualifications should be performed and documented by the agency.
  • A registered nurse is generally responsible for assuring each personal care worker is properly training in certain core competencies.  Periodic and remedial training may be required to meet training requirements.
  • Failure to properly document training provided to personal care workers presents risk; even if the training actually took place.  Training needs to be completely documented or reviewing agencies may deny payment or seek repayment from the provider.
  • Personal care worker documentation must appropriately document the service provided.  The service must be within the allowable scope of service and the start and stop time of the applicable service must be accurately recorded.  Insufficient documentation is one of the most frequent grounds for investigation.
  • The service provided by the personal care worker should match the plan of care for the specific patient.
  • The personal care worker’s documentation must be properly maintained and must make sense in context of the specific care relationship. 
  • Timesheets and claims must match.  Time increments claimed by an agency must be supported by documentation by the personal care worker that matches the claim.
  • Claims must be submitted by the same personal care worker who records the time in the patient record.
  • Avoid using timesheets where the recorded information is photocopied.  Each personal care worker visit must be considered unique and documentation must match the nature of the service provided during that visit.
  • Timesheets must be prepared and signed by the personal care worker and should never be recreated by the agency.  Reviewers will look for evidence a worker’s signature is forged or copied.

Reviewers will look for patterns in documentation that do not make sense.  For example, one or more patient records might be compared to determine whether the personal care worker documents services provided at the same time at two different locations.  An example cited in the report involves a home care aide who submitted timesheets for services rendered while the patient was in an acute-care hospital.  This made the entry patently false and subjected the care worker and agency to legal exposure.  In fact, the care worker in this case was fined and convicted to two years in state prison.

There are numerous compliance “traps” that apply to personal care services.  Compliance requirements based on applicable state requirements and reimbursement rules should be identified as part of the agency’s compliance function.  Monitoring and auditing should take place in areas where most compliance risk exists.  It is highly preferable for an agency to identify areas of non-compliance through its own internal processes. 

Last and not least, the agency must maintain and actively operate an effective compliance program.  Regulatory requirements are numerous and virtually all agencies discover deficiencies over time.  Maintaining an effective compliance program is the best protection against an agency being exposed to potentially devastating results of a government investigation, prosecution, or overpayment demand.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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