On June 22, 2016, the Office of Inspector General for the Department of Health and Human Services (OIG) issued an alert highlighting its decision to increase investigations of and enforcement actions against providers of home health services.

The OIG indicates the increase in enforcement activity is premised on a recent study that concluded home health services are vulnerable to fraud, waste, and abuse. The study, comprised of claims data, criminal convictions and civil settlements for fiscal years 2011 through 2015, revealed that home health agencies, individual physicians and home-visiting physician companies continue to defraud Medicare by making or accepting payments for referring patients, preparing false certifications to meet homebound requirements, and billing for medically unnecessary services.

"The OIG has repeatedly warned physicians and providers regarding compensation arrangements that may influence a provider's decision to refer a Medicare beneficiary for medical services," says Strasburger partner Sam Louis, a former deputy criminal chief of program fraud for the Department of Justice who now handles healthcare fraud litigation at Strasburger. "The increased scrutiny will undoubtedly focus on compensation arrangements between home health care providers and physicians who authorize such services."

The 16-page report of the study released by the OIG includes an assessment that in fiscal year 2015, Medicare paid more than $10 billion in improper payments to home health agencies. The report outlines 27 "hot spots" in several states where it identified common fraud characteristics. Of the 27 hot spots, eight are located in Texas: Dallas, San Antonio, Houston, Laredo, Duval County, Rio Grande City, McAllen, and Brownsville. The OIG identifies the following as common fraud characteristics:

  • Episodes of care during which a beneficiary had no recent visits with supervising doctors.
  • Episodes of care not preceded by a hospital or nursing home stay.
  • Episodes of care with a primary diagnosis of diabetes or hypertension.
  • Beneficiaries with claims from multiple agencies.
  • Beneficiaries with multiple home health readmissions in a short time.

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