Federal Government Blocks New Home Health Agencies in Areas with Worst Medicare Fraud
The Centers for Medicare and Medicaid Services (CMS) announced in the last week of January that they would block approval for new home healthcare agencies in some areas due to worries about Medicare fraud.
The 6-month moratorium on new home health agency development, invoked under the Affordable Care Act, went into effect on Friday, January 31st, and includes Dallas and Houston, TX; Fort Lauderdale, FL; and Detroit, MI.
“Our first use of the moratoria put fraudsters on notice that we are using all available tools, including these moratoria, to combat fraud, waste and abuse in our health care programs, while maintaining patients’ access to care,” CMS administrator Marilyn Tavenner said. “[This] announcement shows we are continuing our intense fight against fraud, waste, and abuse in these vital healthcare programs.”
This is the second wave of bans on healthcare agencies since “hot spots” of Medicare fraud were uncovered by CMS in July 2013. Dallas and Houston were singled out for having a “disproportionate number of home-health providers,” which CMS believes leads to overwhelming Medicare fraud in the area.
The Medicare fraud concern comes nearly two years after federal prosecutors in Dallas said they uncovered the largest home health fraud case ever orchestrated by a single individual – Rockwall, TX physician Jacques Roy, who lost his license and is currently awaiting a Medicare fraud trial. Roy is accused of enabling fraudulent claims and defrauding the US government of $375 million for Medicaid and Medicare fraudulent billing at home health agencies. Roy has pleaded not guilty.
However, there have been multiple other incidents in the Dallas area, including a 2012 case in which an Arlington physician, Joseph Megwa, defrauded Medicare of $100 million. He also pleaded not guilty and is still awaiting trial.
Although Dallas, TX is home to several Medicare fraud indictments, according to CMS’s reports, Miami-Dade has the highest rates of Medicare payouts to home health agencies in the country.
“Miami is king,’’ said an official with the Centers for Medicare & Medicaid Services who asked not to be identified.
“We have an excess capacity in that field,” said Linda Quick, president of the South Florida Hospital and Healthcare Association. “Any resident with a Rolodex and a home health aide thinks they’re a home health agency.’’
Miami-Dade was compared to 30 other counties with at least 200,000 Medicare beneficiaries. What surveyors found was that, per every 10,000 Medicare beneficiaries, Miami had 1,960% more home health care agencies than anywhere else. Such agencies also receive payments of $10,287 per year, compared to other agencies’ average of $5,783 – a 77% difference.
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