Nearly Half of Hospice Providers Uncertain They Would Survive an Audit

As demand for end-of-life services has grown, governmental watchdogs sniffing out fraud, waste and abuse have turned their attention to U.S. hospice providers of all shapes and sizes. But the industry may not be ready to face that heightened scrutiny.

Optima Healthcare Solutions — an Alpharetta, Georgia-based company that provides cloud-based billing, clinical and operational software solutions for post-acute care providers — asked hospice providers about their confidence in surviving federal audits and compliance obligations as part of a new survey released on Tuesday. More than 170 hospice agencies across the country participated in the survey, put together with the help of independent research firm Inquisitive Market Research.

“Many of these hospice organizations have been in business for over 10 years,” Jonathan Skypek, Optima’s vice president of product for its hospice business, told Home Health Care News. “A decade ago, the landscape of hospice was very different than it is today, so we really wanted to know how providers were managing that.”


Overall, nearly half of all hospice providers that participated in the Optima survey reported being uncertain they would financially survive an audit.

Likewise, more than 40% of surveyed hospices expressed a lack of full confidence in their ability to successfully respond to Additional Documentation Requests (ADRs), which are used by federal auditors to review hospice claims.

Years of pressure


Although high, those numbers aren’t all that surprising, Timothy Ihrig, chief medical officer for Crossroad Hospice & Palliative Care, told HHCN. Many hospice providers have been worried about overzealous oversight and their ability to keep up ever since changes from the Centers for Medicare & Medicaid Services (CMS) started coming down the pike a few years ago, he said.

“It all goes back to 2015 and 2016, when CMS changed a lot of the regulatory [standards] for hospice,” Ihrig said. “People went under. We had two of the largest hospices in the United States go out of business because of regulatory changes and compliance issues, specifically with respect to patients meeting criteria to be on hospice.”

To be eligible for the Medicare hospice benefit, patients need to have their hospice doctor and primary care physician certify that they are expected to die within six months. Patients also need to forgo curative care in favor of care meant to maximize comfort and quality of life, though some demonstration programs allow for exceptions.

Despite those eligibility requirements, Medicare hospice spending on patients with stays exceeding 180 days was about $9.5 billion in 2016, more than half of all Medicare hospice spending that year, according to the latest health care spending numbers from the Medicare Payment Advisory Commission (MedPAC).

MedPAC, the Government Accountability Office (GAO) and the U.S. Department of Health and Human Services Office of Inspector General (OIG) have all identified hospice as a focus of their investigatory efforts moving forward.

“Where people are getting dinged is, ‘Why are these patients on hospice?’ Nobody can absolutely guarantee that somebody is going to die in six months,” said Ihrig, who recently spoke about the value of palliative care within the broader health care continuum at a Chicago event sponsored by the Medical Home Network. “That makes you vulnerable from a regulatory and [audit] perspective.”

Crossroads Hospice & Palliative Care is one of the largest palliative care providers in the United States, providing services across Georgia, Kansas, Missouri, Ohio, Oklahoma, Pennsylvania and Tennessee.

‘It’s only going to get worse’

In addition to the added attention from MedPAC, GAO and OIG, CMS also moved to expand its Targeted Probe and Educate (TPE) program to include hospice in October 2017.

“Between MedPAC, OIG, CMS … there’s a lot of attention on hospice,” said Skypek, who is responsible for the design, development and delivery of Optima’s hospice solutions. “The amount of surveys that hospices are going to start getting isn’t going to go down — it’s going to go up.”

Nearly all of the hospice agencies that participated in Optima’s survey on documentation compliance — conducted between June and July of this year — said they felt the need to improve how they broadly manage clinical documentation.

Apart from regulatory scrutiny, documentation challenges are negatively affecting hospice agencies in many ways other ways as well, the survey found, including in regard to clinician satisfaction and speed of payment reimbursement.

Education, software solutions keys to compliance 

Just one-third of hospice providers surveyed indicated that they were using hospice software to assist in documentation and record-keeping — even though those that are using such a platform reported being significantly more confident in their ability to survive audits and respond to ADRs.

While some of the providers who shy away from software may do so because they’re set in their ways and processes, others are possibly priced out, Ihrig said.

Crossroads is in a transition period in terms of its documentation system. The company is teaming up with Dallas-based Curantis Solutions to create its own hospice-specific platform for documentation, billing and accountability monitoring.

Besides documentation software, in-depth education that starts at the patient’s bedside is a key to meeting compliance requirements, Ihrig said.

“What are we seeing? How do we have these [end-of-life] conversations? How do we elicit what the goals of care are?” he said. “Whatever the repository for documentation is — an Etch A Sketch or handwritten charts — we need to hold each other accountable in the hospice industry in elevating and empowering our [clinicians] to go out there and do that.”

Written by Robert Holly

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