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COMPLIANCE

The ABCs of Provider Compliance: A necessity in today’s healthcare climate

The word “compliance” constitutes one of the most under-estimated forces of change in healthcare today. Kathleen Hessler, RN, JD, CHC, CHPC, Director of Compliance & Risk, Simione Healthcare Consultants, says, “It may be a buzz word in many organizations, but compliance typically means different things to the board of directors or executive team than it does to the managers or staff working in home health and hospice. Above all, everyone should agree that the agency or organization needs an active compliance program; this is a vital necessity in today’s health care environment.”

Hessler refers to the ABCs of compliance—Accountability, Best Practices, and Consistency—and classifies areas of risk into three “buckets”, noting that some requirements overlap or spill into each other. Thinking of these three distinct buckets—HIPAA, Medicare Conditions of Participation (CoPs), and Medical Billing and Payment Requirements—can break down the massive concept of compliance and direct efforts in a focused way.

Bucket One: HIPAA

Every health care employee should understand the basics of the Health Insurance Portability and Accountability Act’s (HIPAA) privacy and security provisions, which govern how providers safeguard their patients’ protected health information. Healthcare providers must appoint a HIPAA Security Officer who ensures that all employees and contractors receive education to follow the company’s HIPAA policy and procedures; the Officer must also investigate and resolve complaints.

Bucket Two: Conditions of Participation (CoPs)

The CoPs implemented by the Centers for Medicare and Medicaid Services (CMS) are the criteria that home health and hospice providers must meet to receive Medicare and Medicaid reimbursement for services rendered. Although similar in many respects, the Medicare CoPs for hospice are a separate and distinct set of regulations from the home health CoPs. Medicare requires that provider agencies be surveyed every three years and/or if a complaint is filed against the provider agency.

“While CoP regulations focus on quality and coordination of patient care and performance improvement processes, they also include provisions on patient privacy and confidentiality, thus overlapping with HIPAA laws and compliance.” However, the CoPs do not cover all payment requirements and the state surveyors do not review or cite to payment deficiencies.

Bucket Three: Medicare Billing and Payment Requirements

Since Medicare revenue is the financial backbone of home health and hospice agencies across the country, ensuring that billing and payment policies and procedures are compliant is critical. The stakes are enormous considering the costs in dollars, resources and time that providers incur during audits, appeals, and legal proceedings—both criminal and civil. Finally, stiff financial penalties and exclusion from government programs can ultimately be levied. 

“Providers are under constant scrutiny from the government since the Office of Inspector General (OIG) declared that rooting out home health and hospice fraud and overpayments is a top priority,” Hessler says. Medicare government contract auditors such as the Medicare Administrative Contractors (MACs), Zone Program Integrity Contractors (ZPICs) and Unified Program Integrity Contractors (UPICs) have stepped up activity in recent years, putting more agencies in the hotseat over billing and payment practices. Hessler explains that these agencies monitor billing practices among providers across the U.S. with advanced data analytics. When the results of audits demonstrate potential abusive or fraudulent practices, the OIG works with the Department of Justice (DOJ) to further investigate agencies or companies in question.

Mastering the Compliance ABCs

Agencies that formalize their compliance functions by taking an active approach and adhering to best practices can likely weather the storm if they are targeted for investigation. If an agency has an effective plan in place yet finds itself with an overpayment situation, the OIG and DOJ are often willing to mitigate damages. According to Hessler, the most effective agency compliance programs monitor and audit clinical records for payment requirements prior to submitting a claim. This practice reduces the likelihood of overpayments and minimizes risk.

“In the climate we have right now, preventive compliance efforts are absolutely essential to avoiding problems requiring legal representation and the expense and struggle involved in defending an agency’s integrity,” Hessler says.

Hessler recommends these “best practice” steps to create and maintain a top-flight, prevention-focused compliance program:

  • Create a dedicated compliance team (compliance officer)
  • Know what areas of billing and payment are currently receiving particular attention from regulators
  • Educate clinical staff on how their documentation forms the basis for billing and payment
  • Monitor and audit clinical records to ensure that documentation practices are consistently meeting high standards for compliance
  • Leverage pre-billing audits and technology, such as monitoring systems and dashboards, to track billing patterns and address those that deviate from industry benchmarks or agency norms
  • Tap into resources such as state and national provider associations and consultant groups

While many health organizations devote extensive resources to compliance, some agencies may not give enough thought to the complexities of what compliance actually means.  They might have a false sense of security by having just a few of pieces of the puzzle in place. “Often executives and managers express surprise over identified Medicare overpayments and say they don’t understand how the agency could be liable for overpayments when they just had a stellar recertification survey,” Hessler says.

“Unfortunately, it’s not that simple.  Surveyors are not focused on billing issues and are not auditing records for compliance with claims submission. That is why a comprehensive compliance program is essential in every home care and hospice organization.”

“Compliance is everyone’s job,” Hessler adds. “It is a collaborative effort across organizational divisions, departments, and provider locations, and requires consistency and oversight of practices.”


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