Prior Authorization comes to Home Health? Thoughts on this Latest Game-Changer

This series of articles from HHSM addresses the latest CMS demonstration projects for Home Health; a fraud-preventing protocol that includes a Medicare Prior Authorization of Home Health Services Demonstration project, as well as a Medicare Probable Fraud Measurement Pilot. In this two-part series, we will examine the proposed pilot programs, Home Health integrity concerns that may have prompted these proposals, and where Providers should focus to prepare for these quality reviews of their care plans.

Part One: New Proposals offer programming challenges to Home Health Providers

Last week CMS proposed two groundbreaking demonstration pilot programs aimed at reducing fraudulent and abusive practices occurring among Home Health agencies providing services to Medicare beneficiaries. First, the FRAUD MEASUREMENT pilot would establish a baseline estimate of probable fraud in payments for Home Health care services in the fee-for-service Medicare program. Next, the proposed PRIOR AUTHORIZATION pilot process would be in the form of a pre-authorization determination that would be applied before processing a Home Health claim. If confirmed, the demonstration projects would be implemented in five states: FL, TX, IL, MI, and MA. Following regulatory protocol, these proposed Home Health initiatives includes an open public comment period that extends until April 5th, 2016.

CMS has proposed the Medicare Probable Fraud Measurement Pilot, designed to establish a baseline estimate of likely fraud in payments for Home Health care services in the Medicare fee-for-service program. CMS and contractors will collect information from Home Health agencies, the referring physicians and Medicare beneficiaries selected in a national random sample of Home Health claims. The pilot will rely on the information collected, along with a historical billing summary of the agencies involved, to estimate the percentage of total payments that are associated with probable fraud, and then determine the percentage of all claims that are associated with probable fraud for Medicare fee-for-service Home Health.

CMS has also proposed the Medicare Prior Authorization of Home Health Services Demonstration Project, which would assist in developing improved procedures for the identification, investigation, and prosecution of Medicare fraud occurring among homecare agencies providing services to Medicare beneficiaries. By assuring that payments for Home Health services are appropriate before the claims are paid, CMS plans to prevent fraud, waste, and abuse in a more consistent and standardized manner.

In the release, CMS goes on to state that the proposed Home Health Prior Authorization program would be “similar to the Prior Authorization of Power Mobility Device (PMD) Demonstration, which was implemented by CMS in 2012.” The release states that “this demonstration would also follow and adopt prior authorization processes that currently exist in other health care programs such as TRICARE, certain state Medicaid programs, and in private insurance.” The information CMS seeks will be obtained through Medicare contractors for two specific purposes; to determine proper payments are approved for qualified value-based programs, and to determine if there is suspicion of fraud. These CMS contractors will require information from Home Health Providers in advance to determine appropriate payment and qualification for the proposed program; this would become standard operating procedure necessary to submit billing claims.

Certain thoughts and concerns quickly come to mind when pondering the effects that a Prior Authorization protocol could have on the production and delivery of homecare services. For example, delays in care delivery could thwart the focus on care transitions prompted by the ACA-based Episodic Bundling models. In addition, there could be a considerable administrative and management burden for Home Health Providers; though I’m quite sure that administrative burdens have little effect on quality and integrity initiatives protecting a Federal Benefit Program such as Home Health. The concerns regarding administrative and management issues Home Health Providers may confront will likely remain un-addressed; this may be the cost of care redesign.

A quick review of PMD and Tricare Prior Authorization protocols offer some insight into what Home Health might experience if these proposals are passed. They include:

  • A “submitter” would complete and submit the prior authorization request. The submitter could be the ordering practitioner or the supplier.
  • The Medicare Contractor (probably the FI) would review requests and determine authorization to proceed with approved programming.
  • A standard turnaround time would be established with a resubmission phase if necessary. Also, an expedited authorization process would be in place for scenarios where the standard turnaround time could jeopardize the beneficiary.

At this time, it is unclear whether the program, aimed at five specific states for demonstration pilot purposes, will expand into a national requirement. At least four of the states named in the CMS release have billing or care patterns that include fraudulent or abusive Home Health claims; MI, TX, FL and IL. Since 2009, those same states are also targets of the fraud enforcement program known as H.E.A.T. – Health Care Fraud Prevention and Enforcement Action Team. The H.E.A.T. is a program co-managed by the Department of Health and Human Services and the Department of Justice. But if the initial demonstration plot is successful, I think it would be safe to assume that expansion of the program would be in our future.

It is important to note the significant difference between the HEAT program and these two proposed Home Health Initiatives. The HEAT task force focuses directly on Providers with billings or practices that are identified as unique when compared to standard Home Health patterns. In contrast, these latest CMS initiatives focus on all Providers practicing in five states, regardless of practice patterns or any other discriminating factor. Free-standing or hospital-based, profit or non-profit, post-acute or community referral based; all Home Health Providers will be subject to prior authorization care review and a baseline estimate of expected fraud. The integration of these new programming factors will assuredly change care production protocols, particularly as Home Health Providers seek to create Start of Care programs that meet the Prior Authorization approval requirements.

Traditional Home Health programming elements will likely be challenged under the proposed Prior Authorization model. The potential areas of review for approval are many; qualified Face-2-Face documentation, care programs that match clinical deficits identified in the OASIS, and volume or cert-period based care plans are examples of what we might expect. More specifically, will a 73 y/o patient, recently discharged from a 3-day acute hospital admission back to her daughter’s home, exhibiting shallow medication management and ADL declines, qualify for a 60-day care program under the prior authorization review? What level of homecare aide might be approved? Will PT be approved to cover OT ADL deficits in the case of inadequate OT availability? The list goes on and on.

We will expand on these and other questions in Part Two of this newsletter; including a review of common care practices that may fail to survive under the CMS proposals. By addressing areas of PPS Home Health care production that many agencies struggle with today, we might predict how those could become factors in the Prior Authorization model of tomorrow. In addition, we will propose how the ACA Care Models, along with the volume to value shift Home Health is currently confronting, may play a role in how these demonstration programs affect day-to-day care delivery.

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