Hospices Overbilled Medicare by $268 Million, Compromising Home Care

Hospices inappropriately billed for general inpatient care (GIP), and most of those services could have been provided in the home care setting instead, according to a recent report from the Office of Inspector General (OIG).

About one-third of all billing in 2012 was found to be inappropriate, costing Medicare $268 million for the year, according to the OIG report. Compared to home health care, hospice GIP is reimbursed by Medicare at a much higher rate—$672 per day for hospice versus $151 for routine care. Most inappropriate billing should have been designated for home care, according to the report.

“For the vast majority of inappropriate GIP stays, the hospice should have billed for routine home care instead of GIP,” OIG found.

The report outlined the specific instances when hospices inappropriately billed Medicare.

“Misuse of GIP includes care being billed but not provided and beneficiaries receiving care they do not need,” the report defined.

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Hospices were found to frequently bill for managed symptoms when a patient could have been cared for at home.

“A hospice billed for 51 days of GIP for a beneficiary who needed only routine home care,” the report found. “The beneficiary’s symptoms were under control and she needed assistance only with personal care, eating and the administration with medication.”

For this instance, the hospice was paid nearly $30,000 by Medicare for more than seven weeks of GIP.

Hospices were also more likely to inappropriately bill for GIP when care was provided in skilled nursing facilities compared to hospitals and hospice inpatient units.

Some states had higher rates of inappropriate billing than others, the report found. Out of 99 GIP stays in Florida, more than half—52 stays—were considered inappropriate. Ohio and Arizona also stood out with the highest number of inappropriate stays in the study’s sample.

OIG recommended increasing oversight of hospice GIP claims, particularly among SNFs and GIP care provided by for-profit hospices. Reviews of lengthy GIP stays could help determine if another level of care, such as home health care, is more appropriate, the agency recommended.

The study was based on a review of a random sample of all GIP stay medical records in 2012.

Written by Amy Baxter