A Summary of Pre-Claim Review for Home Health Agencies

By now, home health agencies are well aware of the new program under development by CMS to crack down on what they believe is a major problem with improper payments for their services.  This is referred to as the “Pre-Claim Review Demonstration”.

This document describes these new regulations that were published in the Federal Register in June.

This effort is a drastic attempt by CMS to reduce the increasing improper payment rates associated directly with home health services.  Essentially, developing a process to examine 100% of all claims submitted by Home Health Agencies (HHA) prior to their approval and final payment.

Pre Claims Review for Home Health

CMS’s Comprehensive Error Rate Testing (CERT) program annually estimates the percentage of payments that did not meet Medicare coverage, coding and billing rules.  For 2015, they calculated the improper payment rate for home health claims at 59%.  This compares to 51.4% in 2014 and 17.3% in 2013.  CERT determined that a majority of errors that occurred in 2014 were due to the fact that the narrative documentation associated with face-to-face encounters did not support the patient’s homebound status and the need for skilled services.  Now CMS no longer requires separate narrative documentation for the face-to-face, but they are still seeing many cases where the documentation provided by the HHA in the medical record does not support the home health benefit they are providing.  These improper payments do not necessarily indicate fraud, it may simply be a lack of documentation, documentation errors, or a lack of understanding of Medicare rules.  However, fraud is a substantial contributor to the problem.

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