CMS Addresses Concerns Over Home Health Pre-Claim Reviews

Days after unveiling a preauthorization requirement for home health agencies, providers expressed confusion and concern as the Centers for Medicare & Medicaid Services (CMS) attempted to clarify what the plan entails.

The new preauthorization measure, dubbed the Pre-Claim Review Demonstration for Home Health Services, aims to crack down on Medicare fraud, waste and abuse in five states.

But providers remain skeptical about its purpose and confused about its implementation. Among the many questions and concerns brought forth by providers, most seemed preoccupied by administrative burdens, timely responses and documentation requirements involved with the demonstration.


The first state, Illinois, will face the demonstration no earlier than Aug. 1. It is slated to run for three years in each state after rollout.

“We believe we’ll be able to start on Aug. 1,” CMS officials said Tuesday during a call with providers. “That really is our target date for now.”

Under the demonstration, home health agencies located in Illinois, Texas, Florida, Massachusetts and Michigan will be required to submit documentation for review before processing claims for services. The requirement comes as a result of a 59% improper payment rate among home health claims in 2015, according to CMS.


Despite outcry from providers and industry associations that there should be a more targeted approach if combating fraud is the goal, CMS stood by its method.

“Due to the extent of the problem, we chose to go with a much broader approach,” CMS officials said.

Following the CMS announcement, interested parties feared the requirement would burden agencies even further, given that the federal agency didn’t immediately identify what documentation is necessary to submit for a review or how it should be submitted.

During the call, CMS stressed that no additional documentation is necessary under the pre-claim review—that paperwork simply needs to be submitted earlier in the process to ensure accuracy and deter the agency’s “pay and chase” method, in which CMS would make a payment and deem it improper afterward.

“What we’re really looking for is to make sure the medical necessity requirements are met,” CMS officials said.

Still, home health providers on the call said the process will require extra staff in order to complete the new function, and the money needed to fund this would be tough to come by.

Because it’s not new documentation, though, there should be little to no added costs for agencies, according to CMS.

“This should be information [home health agencies] already have,” CMS officials said. “We’re confident that you’ll be able to pull it together to submit the pre-claim review.”

Another concern raised had to do with timely turnaround of reviews. CMS will respond to the initial pre-review submission within 10 days, and home health agencies can resubmit the supporting documentation as often as necessary during the review. Resubmission decisions will be delivered within 20 days.

Because of the vast number of Medicare-certified agencies in each state, though, providers worry about the accuracy of those timelines. CMS affirmed it has modified its contracts with its Medicare Administrative Contractors (MACs), provided additional funding and is hiring more staff to work on this demonstration. As such, the workload will be manageable, officials said.

Additionally, CMS noted pre-review documentation can be submitted by mail, via fax or electronically. There’s a three-month grace period for agencies in each state from their respective effective dates, after which there will be a 25% reduction in the full claim amount if documentation wasn’t provided beforehand.

Rachel Hecox, registered nurse and director of clinical services for Western Illinois Home Health Care, tuned in to the call and found it went well, but she is still concerned about how much time is spent adhering to regulations. Her agency is now awaiting the operational manual promised by CMS to determine how to organize the process of submitting pre-claim materials to the MACs involved in the demonstration.

“While I agree with CMS’ statement that they are not asking providers to submit different documentation than previously has been required, it’s the implementation of submitting the documentation and the timeline we now have to do so that each provider has to figure out and add to the list of current daily tasks that I’m most worried about,” she said in an email to Home Health Care News. “How many fraud-reducing measures will be added to reduce fraud but in the process also reduce the number of ethical providers?”

CMS will hold another call with providers on June 28.

Written by Kourtney Liepelt

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