The contractors for Region A (Performant Recovery, formerly Diversified Collection Services, or DCS) and Region B (CGI Technologies and Solutions) are those that most recently posted new issues for home health claims.

Recovery Audit Contractors (RACs) must seek approval from the Centers for Medicare & Medicaid Services (CMS) for all new issues and must post all approved issues to the Recovery Auditor website prior to submitting demand letters to providers. 

DCS posted two issues, which were approved on Oct. 26; CGI posted the same two issues, which were approved the day before. The issues included the following issue descriptions: 

  • No Skilled Service – “To qualify for the home health benefit, a patient must need a skilled service. When a skilled service is needed, dependent services such as (a) home health aide may also be covered. Dependent services are not covered for a patient who no longer needs a skilled service.”
  • Skilled Nurse Length of Stay – “Home health late episodes (third and later) receive increased payment; therefore, payment incentives exist for extended home health care. Medicare covers skilled nursing services when they are reasonable and necessary. Extended nursing care for observation and assessment may not be covered. Claims for nursing services into the third episode and after will be reviewed to determine if all Medicare coverage criteria (are) met.”

Providers in Region A (Connecticut, Delaware, Washington, D.C., Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont) and Region B (Minnesota, Wisconsin, Michigan, Illinois, Indiana Ohio and Kentucky) should be prepared to receive RAC letters requesting patient records for review for one or both of these issues.

Providers can assess their risk of denials related to these two issues by auditing clinical records in which a patient received home health aide services and/or received services during a late episode of care. The review for dependent services should focus on documentation that supports the need for skilled services, such as nursing, physical therapy, speech therapy or occupational therapy services.

The documentation must describe clearly that the services provided met the Medicare definition of skilled care and were ordered by the patient’s physician. The review for the length of stay should focus on documentation that supports the reason why ongoing care is required. The documentation also must describe services that are reasonable and necessary for the treatment of the patient’s illness or injury. Providers should refer to the Medicare Benefit Policy Manual, 100-02, Chapter 7, Section 40 for guidance and general principles governing covered services.

At this time Connolly Healthcare, the contractor for Region C, has three issues for home health claim review. Two of the issues involve automated reviews, which do not require obtaining medical records from agencies. The first issue was approved Jan. 27, and it targeted incorrect billing of home health partial episode payments. The second issue was approved May 22, and it targeted Request for Anticipated Payment (RAP) claims paid without a corresponding home health final claim. The last issue is a complex review issue, which requires obtaining medical records from agencies. The review is for medical necessity and conditions to      qualify for services, and it was approved June 29.

The following is the description provided by Connolly:

  • Medical Necessity and Conditions to Qualify for Services – “Medical record(s) will be reviewed to validate that the home health services provided were both reasonable and medically necessary, and that the patient met the conditions to qualify for home health services.”

The RAC contractor for Region D (HealthDataInsights) has not posted any approved issues or issues under review, but the expectation is that similar issues will be adopted by this regional contractor in the future. 

About the Author

Bonny Kohr, RN, CHCE, HCS-D, is the manager of clinical services for  FR &R Healthcare Consulting, Inc. She is a registered nurse, a certified home care coding specialist and a certified home care and hospice executive. Bonny has worked 23 years in the field of home health care. She began her career in home care as a field staff nurse, then as a clinical director, and finally as chief operating officer. 

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