Some home health agency owners are in a sweat these days. The reason? Recent notice from their Medicare administrative contractor (MAC) that their 2010 cost report is being audited to provide accurate cost data for the 2014 rebasing of home health rates mandated by Congress.

Letters from Palmetto and NGS state that agencies will be advised of “the effect on program reimbursement of this reopening” and have the right to appeal cost report adjustments “made as the result of this reopening.”

So far, CMS hasn’t explained how – after more than a decade of episode payments based on patient condition and services required – cost reports might affect home health reimbursement, as the letters imply. “If there is no money effect, no appeal is permitted or accepted by CMS,” notes consultant Tom Boyd of Boyd and Nicholas in Rohnert Park, Calif.

For some agencies, the penalties for audit errors is another concern. “Any false statement or representation of material fact in any application for any benefit or payment” can be punished by a fine of to $25,000 and/or up to five years in prison, the cost report regulation states.

But such charges are unlikely, believes home health attorney Robert Markette with Benesch, Friedlander, Coplan & Aronoff in Indianapolis. That’s because the government must prove the provider made the cost report mistakes “knowingly and willfully” in seeking Medicare reimbursement, Markette notes.

 

For more on this story, see this week's HHL.