US Government Accountability Office
441 G. Street NW
Washington, DC 20548
February 5, 2013
Dear Representatives of the GAO:
Central New Hampshire VNA & Hospice greatly appreciates the opportunity to provide information to
the GAO regarding recent intense efforts on the part of CMS to conduct pre and post payment audits
among home health and hospice organizations. We understand the need for CMS to increase its
scrutiny of providers in an effort to detect fraud and abuse. Nevertheless, we are greatly concerned
about certain aspects of the audit process and of the claims review contractors as we outline below.
Central New Hampshire VNA & Hospice has received Additional Development Request (ADR) audits in
the past, and we have limited experience with probe audits. Since January 1, 2013, however, we have
seen audit volume far in excess of any we have seen in the past. Not only are audits requests occurring
more frequently , but the issues directing the audits are more vague (or not listed at all), the data
required to support our claim is more expansive, and the responses from auditors do not align with the
home health or hospice rules as we know them. Below are our specific concerns:
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Casting the audit net broadly - without guidance for agencies. The new ADR audits, particularly
those in hospice, have no apparent focus and the audit requests offer no guidance to agencies
about the target/focus of the review. In the absence of specific information, an agency is
compelled to send all possible data, but lacks the ability to highlight information that supports a
specific element or focus. The audits are so broad that an agency cannot realistically assist a
reviewer in locating information that supports the agency’s claim.
Lack of transparency in the process. In each audit type – ADR, RAC, PICC and probe review - the
agency has no knowledge of the entity conducting the audit, the qualifications of the auditors,
the audit criteria or how the auditor measures the agency’s performance against those criteria.
There is no standardized and validated tool available to both agency and auditor, and agencies
have no evidence that auditors are qualified to assess home health or hospice care. Further, we
have no evidence that auditors are subject to an assessment of inter-rater reliability that would
support the validity of their decisions.
Lack of Quality in the Audit Process. There is no evidence that auditors have been trained in
home health and hospice criteria, that they understand computerized records or that their
decisions are themselves subject to quality review. Following several of the audits that have
been conducted on services provided by our agency, the auditors issued a claim denial based on
alleged absence of information that was clearly present in the information package. For
example, in one case, the auditors claimed that the physician had not signed the hospice
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election form, yet the physician’s signature was clearly present and the form was included in the
audit information package. This leaves the agency with no alternative but to appeal the decision
– a process that is due to the error of the auditor but administratively burdensome on the
agency. Such oversights indicate that the quality control in the audit process is lacking or that
the auditors have no familiarity with the required documents or with the electronic health
record software they are expected to review.
Lack of common interpretive guidelines on the platform of denial. Auditors are rendering
decisions that inconsistent with agencies’ understanding of common service criteria and outside
the regulatory framework, i.e. definition of homebound, evidence of need for skilled service,
speed of decline among hospice patients, etc. For example, in a recent audit of a hospice
patient seen by our agency, the auditor denied the entire claim on the basis that the patient was
not declining fast enough to support hospice. Declines in the patient’s physical status were
clearly documented, but there is no regulatory guidance issued from CMS on how quickly a
patient must decline in order to qualify for hospice. The auditor’s decision appears to have been
made on a capricious and non-regulatory view that the patient had not died fast enough. Of
note,, by the time the pre-payment decision was rendered, the patient had indeed died.
In another recent home health audit in our agency, the reviewer determined that the patient
was not homebound in spite of the clinician’s regular reports that the patient left the home
infrequently and required unusual and taxing effort to do so. The clinician also noted on the day
of discharge that the patient’s family occasionally assisted her with activities of daily living,
including transportation for the purpose of obtaining necessities. The claim was denied on the
grounds that the family’s assistance meant that the patient was not homebound. It appears that
the reviewer took the interpretation of homebound to mean that a patient must never leave the
home, although there is no regulation to support that interpretation, and CMS has published
materials to support the allowance of the patient to leave home so long as it is infrequent and
requires taxing effort.
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Requesting information that is not under the purview of home health or hospice providers to
support a claim. The new ADR format requests information that is not in the domain of the
home health or hospice agency and should not be a condition of review. For example, a recent
ADR audit received by this agency for a hospice patient requested the patient’s healthcare
records 30 days prior to admission by this agency. The deadline for receipt of these materials
was 30 days from the time of audit notice. It is inappropriate for an auditor to require records
that are not in the domain of the home health or hospice agency. We neither crafted those
records, nor do we routinely have access to them. The process of attempting to obtain them is
time consuming and our efforts will not reliably produce the desired documents. It is outside
the home health regulatory framework to request such records.
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Onerous Administrative Burden. The new intense audit initiatives have caused a marked
administrative burden on agencies. NHIC, the contractor for the New England region, has
apparently elected to conduct a 5% hospice ADR record review. There was no notice of this
from NHIC, and our agency only obtained the information from our state professional
association. Since the onset of this new system, the agency has noted that it spends an average
of 5 hours preparing each record for review. While any agency would expect to invest some
time in conducting audits, this initiative has dramatically increased administrative overhead
without enhancing care to patients. When time devoted to appeals is taken into consideration,
that administrative burden is multiplied many times over.
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The Audits Do Not Reliably Target Providers Whose Data is Outside the National Standard.
This agency shares a concern about fraud and abuse with CMS, but we are puzzled why CMS
does not use its own data to identify the agencies that are outliers on the volume of service,
location of service, diagnosis codes and other indicators that would direct intense audit efforts
where CMS is most likely to find abuse. Casting the audit net broadly wastes resources and
focuses on areas where there is little likelihood of fraud while failing to identify the areas where
fraud is most likely. In addition, smaller agencies with no “red flag” indicators spend an
inordinate amount of time defending their rational service while agencies with multiple red flags
have no greater scrutiny than anyone else. The administrative burden and the impact on cash
are so onerous, that it may drive some of these agencies into financial peril and reduce access to
services for the beneficiaries they serve.
In an informal study conducted by the Home Care Association of New Hampshire, up to 20% of
small agencies elected not dispute ADR denials because they did not have the resources to do
so. Of those agencies that did invest the resource, 47% of denials were overturned, and another
15% are yet to be decided. If the reliability of a denial is only 50% or less, then the target, the
process or the criteria are flawed. Again, CMS has the data required to identify the “red flags”,
and they should focus attention there.
We thank you for your willingness to explore the concerns raised by the recent increase in audit
activity in home health and hospice. We look forward to modifications in the audit system that
will yield a transparent, standardized and targeted audit process that attends to the fiscal
concerns of the American taxpayer while respecting the work performed by responsible
agencies in service to Americans.
Sincerely yours,
Margaret Franckhauser, RN, MS, MPH
Executive Director