HCFA makes bond concessions; fraud remains on front burner
HCFA makes bond concessions; fraud remains on front burner
The federal government is assessing comments made by home health care agencies, surety bond writers, and anyone else that took advantage of a March 6 deadline to tell the government what they think about new regulations designed to rein in fraud and abuse, reports Hospice Management Advisor's sister publication, Home Health Business Report.
As the Health Care Financing Administration (HCFA) mulled over the comments it solicited on its controversial surety bond plan, the agency also issued technical revisions to the surety bond and capitalization regulations it had written to implement requirements of the Balanced Budget Act of 1997. The changes, which government officials say will "help smaller, reputable home health agencies, such as non-profit visiting nurse associations, obtain surety bonds without weakening protections to Medicare and Medicaid," include:
· limiting a surety bond company's liability to the period when the government determines that money is owed to Medicare and Medicaid, regardless of when the payment or overpayment took place;
· making surety companies liable on a bond for an additional two years after the date a home health agency leaves a Medicare or Medicaid program;
· giving surety companies the right to appeal an overpayment, a civil monetary penalty, or an assessment if the home health agency doesn't use its right of appeal.
The National Association for Home Care (NAHC) weighed in quickly with its comments, saying the new changes might help the bond companies, many of which had balked at backing the bonds on the grounds that expense and liability were too high. However, the changes won't correct the majority of problems for providers, including the bonds' high cost ($50,000 or 15% of a home health agency's annual Medicare or Medicaid revenues), and its requirement for personal guarantees or collateral from providers to back the bonds.
The Jacksonville, FL-based Home Care Association of America (HCAA) filed an injunction against HCFA on Feb. 6, seeking to have the government restrained from imposing the original surety bond regulations, set to go into effect Feb. 27. On Feb. 26, HCFA backed off and extended the deadline indefinitely while it solicited comment. "We'll go forward again with a suit if the new regulations don't go far enough for us," says HCAA executive director Colin Williams.
Meanwhile, the California Association for Health Services at Home (CAHSAH) has advised providers to keep documentation on all dealings with surety bond companies. CAHSAH recommends keeping letters from companies that refused to sell a bond and encourages home health agencies to request a letter instead of accepting a verbal refusal from the bond company. The controversial surety bond requirement does not apply to hospices, unless they are also certified as home health agencies. However, experts suggest that this kind of requirement could be in hospice's near future, if the current focus on fraud and abuse keeps accelerating.
Fraud remains in the headlines: At a St. Patrick's Day conference on health care fraud, Health and Human Services Secretary Donna Shalala compared the government's new fraud-and-abuse initiative to St. Patrick. "We are determined to drive the snakes out of Medicare and Medicaid," she declared. According to legend, St. Patrick drove the snakes out of Ireland.
HCFA also will be hiring special contractors such as accountants and bankers from the business world to stop Medicare fraud and abuse, and will soon issue rules specifying the actions these contractors can take.
At the same meeting, Malcolm Sparrow, a Harvard University lecturer and author of the health care fraud book, License to Steal, implied that crooks can fairly easily fool Medicare. "If you bill correctly, you are free to lie, so bill your lies correctly," he said. Meanwhile, providers continue to complain that every error in complying with complicated federal rules is viewed as fraud and abuse, not an honest mistake.
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