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From Health Law Daily, March 20, 2014

Unimplemented recommendations could improve program performance

By Jay Nawrocki, MA

HHS’ Office of Inspector General (OIG) has released its report on unimplemented recommendations in its report Compendium of Priority Recommendations. The Compendium focuses on unimplemented recommendations in 25 areas that “on the basis of the professional opinion of the OIG, would best protect the integrity of HHS programs if implemented.” The OIG stressed that recommendations are grouped by program areas and are not ranked in any order, so no one recommendation is receiving a higher priority over another for implementation (OIG Report, Compendium of Priority Recommendations, March 19, 2014).

The single largest number of unimplemented recommendations identified by the OIG in the report has to do with fraud and abuse measures and CMS’ oversight of Medicare contractors. The OIG also highlights a number of unimplemented recommendations concerning hospitals; post-acute care facilities such as skilled nursing facilities (SNFs), home health agencies (HHAs), and hospices; and providers such as laboratories and community mental health centers. Provisions of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) may address some of the OIG’s concerns when they become effective. The FDA was also mentioned for not implementing recommendations regarding dietary supplements and oversight of the food chain.

Medicare contractors. The OIG identified 22 unimplemented recommendations having to do with improving the performance of Medicare contractors including 10 unimplemented recommendations having to with Medicare contractor conflicts of interest, and 7 relating to ways to reduce fraud and abuse generally. The OIG said, “CMS has not leveraged contractor-reported data to improve oversight; has not investigated variation in data across contractors to determine underlying causes, especially when it is not explained by the size or geographical jurisdiction of contractors; has not addressed underperforming contractors timely  and required corrective actions for all performance standards that were not met; and has not shared information with beneficiaries and other stakeholders that could assist in antifraud efforts.”

Specifically the OIG has not seen any action by CMS regarding efforts to seek a legislative change to increase the time between MAC contract competitions so CMS has more time to review potentially new contractors. Another unimplemented recommendation identified by the OIG would require corrective action plans for all unmet quality assurance standards. A number of unimplemented recommendations had to do with the referral of findings of recovery audit contractors of potential fraud and error rate reduction programs. According to the OIG, these unimplemented recommendations could reduce the amount of erroneous overpayments.

Hospitals. Unimplemented recommendations concerning adverse events was another area identified by the OIG. The OIG estimates that nearly 1 in 4 Medicare beneficiaries were harmed during a hospital stay in October 2008. The OIG noted that while state survey agencies are timely investigating these incidents, more could be done by CMS to improve the quality of care. Unimplemented recommendations included ensuring that state agencies monitor hospital’s corrective action plans and that compliance with all conditions of participation are surveyed when a state of immediate jeopardy is determined. The OIG was hopeful that a provision of the ACA will help improve hospital performance in this area.  Section 3008 of the ACA requires payments to hospitals to be reduced by 1 percent if the hospital is in the top 25 percent of hospitals treating patients for a hospital acquired condition.  The payment reduction begins on October 1, 2015.

A number of unimplemented regulations had to do with CMS reviewing and determining why some hospitals have a larger number of outlier payments than other hospitals for the same service. Outlier payments account for almost 12.8 percent of inpatient reimbursements for some hospitals while the national average is 2.2 percent, according to the OIG.

Two other priority areas for hospitals include: (1) payment for outpatient services related to a subsequent inpatient admission and (2) early transfers to hospices. On the first issue the OIG issued a recommendation in a February 2014 report that CMS should seek legislative authority to increase the number of days prior to an inpatient admission in which any services provided would be included in the inpatient prospective payment system (IPPS). In a May 2013 report the OIG recommended the adoption of a policy to pay hospitals a portion of the IPPS payment instead of the full payment when a patient is discharged to a hospice.

Post-acute care. Unimplemented recommendations regarding SNFs, HHA and hospices had to do with ways to decrease improper billings. One report found that HHAs had an unusually high number of billings in one particular area. Another report found that there is a large amount of uncollected overpayments by HHAs. An OIG recommendation of implementing a $50,000 surety bond requirement might reduce this amount.

In 2009 the OIG found that one quarter of all bills submitted by a SNF were inaccurate, for medically unnecessary care, or were simply fraudulent leading to $1.5 billion in inappropriate Medicare reimbursements to SNFs. The provision of hospice care to SNF residents was also troubling to the OIG. Medicare spending on hospice care to SNF residents rose from $2.55 billion in 200 to $4.31 billion in 2009. Hundreds of hospices were identified that had more than two-thirds of their billings for beneficiaries who resided in a SNF.

FDA. An October 2012 report showed that a number of dietary supplement’s claims about their composition and function did not meet FDA requirements. A second report highlighted how 28 percent of companies manufacturing supplements failed to register with the FDA and of those who did register 72 percent failed to provide all the required information. The FDA has still not implemented recommendations to address these situations, according to the OIG.

Another area of concern for the OIG was the FDA’s inspections of food facilities and their ability to trace food in the supply chain. The OIG found that 59 percent of food facilities did not meet the FDA’s requirements to maintain records about the source, recipients, or transporters of food products. In addition there were unimplemented recommendations to the OIG’s findings that 54 percent of violations found during inspections of food facilities designated as “official action indicated” were never followed up or were lowered in severity.

MainStory: TopStory ProgramIntegrityNews FraudNews IPPSNews OPPSNews SNFNews HomeNews HospiceNews FoodNews FoodSafetyNews FoodStandardsNews PartANews PaymentNews HealthReformNews

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