How to Handle a Home Health Audit, According to a CMS Auditor

If you operate a home health agency, Laura Long and her colleagues are probably the last people you want to hear from.

Long is the Medicare operations lead at AdvanceMed, one of five unified program integrity contractors (UPICs) nationwide hired by the Centers for Medicare & Medicaid Services (CMS) to audit and investigation home health agencies.

“My biggest message is don’t panic [if you’re audited],” Long told attendees at the 2019 Illinois HomeCare & Hospice Council (IHHC) leadership conference last week. “It may happen.”


Long explained the audit process and touched on common investigation catalysts during the event, held in Itasca, Illinois, a suburb of Chicago.

“Our goal is to identify folks and providers who need a closer look,” she said. “Does that automatically mean that they’ve done something wrong? No. That just means the data and or allegations that have been launched need further investigation.”

Specifically, Virginia-based AdvanceMed uses data analysis, medical review and investigators to identify potentially fraudulent agencies and claims in the Midwest. However, it is allegations that often spark investigations, Long said.


“It could be that somebody called in with a complaint and said, ‘I saw that ABC Home Health Agency billed for services, but I don’t get home health services,’” she said.

Allegations could come from employees, Medicare beneficiaries, family members or the Office of Inspector General’s (OIG) hotline.

After ramping up its oversight in fiscal year 2018, OIG recovered an estimated $2.91 billion last year, thanks in part to tips to its hotline. Between April 1 and Sept. 30 last year, OIG received more than 60,000 tips, 8,096 of which were actionable, according to its semiannual report.

What to expect during an audit

After an agency is flagged based on allegations or questionable data, UPICs like AdvanceMed start digging. Sometimes, they find a simple mistake that’s easily fixed.

“They really didn’t understand this piece of regulation, or they hired somebody new in billing who didn’t understand what they were doing,” Long said.

When there are more red flags, the UPIC may decide to open an investigation or audit.

While AdvanceMed serves the Midwest, other regions of the country are covered by different UPICs. In the West — which also includes Alaska and Hawaii — and Southwest, it’s Maryland-based Qlarant Integrity Solutions. Meanwhile, CMS contracts Florida-based SafeGuard Services to cover the Northeast and Southeast.

In the event a UPIC needs to contact a home health agency to investigate allegations, they’ll start with a phone call or letter, Long said. The goal is to verify general information.

“Probably the most common [outreach] is you’ll get a letter,” Long said. “It says, ‘Hi, we’re AdvancedMed, and we’re looking into some allegations. We’d like to take a look at some medical records.’”

The letter will explain which records the UPIC is requesting, where and when an agency needs to send them, along with why the inquiry is being made.

Other times, UPIC employees might show up at a home health provider’s door — announced or unannounced — to ensure the business is operational and request records.

“I encourage you, if anyone presents themselves and says, ‘Hi, I’m with AdvanceMed [or] I’m a UPIC, and I need access to these medical records,’ ask them for ID,” Long said. “We carry badges.”

If a home health agency is still uncomfortable, it can request a CMS contact to ensure the representative is legitimate.

Even if an agency isn’t intentionally doing anything wrong — that doesn’t necessarily mean it’s in the clear. Misinformation often leads to inaccurate claims or inappropriate use of services, Long said, pointing to home health administrators, doctors and beneficiaries who don’t understand the coverage requirements.

“You go to … visit the patient and you find the spouse [who] says, ‘They’re at the grocery right now,’” Long said. “And you have those conversations, ‘How often do they go to the grocery?’ ‘Oh, two or three times a week.’ ‘Who takes them to the grocery?’ ‘Well,the bus stop is just down the block. He walks down the block.’”

Per CMS’s criteria, that patient would be ineligible for the home health benefit.

To receive home health services, patients must be confined to their home and require skilled care. They must also be under the care of a physician, with whom they’ve had a face-to-face encounter, and have a plan of care established.

Post-audit actions

If a UPIC finds that a home health agency’s clients don’t meet these requirements — or discovers the provider is guilty of other fraud, waste or abuse — there are several actions it can take.

UPICs can call for education, make overpayment determinations and — with CMS approval — suspend payments, the latter two of which agencies can appeal. The contractors can also extrapolate, extending their findings when appropriate.

“If we review 30 claims, and we find that 25 of those have been overpaid, then we can extrapolate those results across the entire universe, whatever that defined universe was,” Long said. “So maybe instead of having a $50,000 overpayment, you have a $2 million overpayment.”

Reducing improper payments has been a priority for CMS in recent years, with the agency taking several measures to help curb fraudulent or sloppy claims submissions. Efforts, for example, include the 2016 Pre-Claim Review Demonstration and the upcoming Review Choice Demonstration.

CMS’s efforts to make sure tax dollars — about 20% of which are spent on health care — are going to the appropriate providers for the right reasons seem to be paying off. They led to a $6.92 billion decrease in estimated improper payments from 2015 to 2018, according to CMS.

Additionally, home health improper payment rates decreased from 58.95% in 2015 to 17.61% in 2018.

To best safeguard themselves from being audited, agencies should make sure to educate their staff on the latest regulations and do their best to operate within them, Long said.

Helping home health providers improve their compliance is why she spoke at the IHHC conference to begin with, she said.

“CMS said take that opportunity to educate,” Long said.

Companies featured in this article:

, ,