The U.S Centers for Medicare & Medicaid Services (CMS) is implementing a “period of enhanced oversight” for new hospices in California, Nevada, Arizona and Texas.
A key component of the enhanced oversight includes a medical review of claims before a Medicare Administrative Contractor (MAC) will pay them.
These actions follow reports of potentially unethical or illegal practices among hospices, particularly among new companies popping up in those four states, which have spurred calls for stronger oversight from lawmakers and other stakeholders.
“CMS is placing newly enrolling hospices located in Arizona, California, Nevada, and Texas in a provisional period of enhanced oversight. Over the last 12 months, we’ve received numerous reports of hospice fraud, waste, and abuse,” the agency indicated in a Medicare Learning Network alert. “The number of enrolled hospices has also increased significantly in these states, raising serious concerns about market oversaturation.”
The enhanced oversight period applies to hospices in those four states that are newly enrolled in the Medicare program as of July 13, as well as those who are submitting or undergoing a change in ownership.
Individual hospices will receive notice from CMS that they will be receiving this additional oversight, which can last from 30 days to as long as a year. Hospices that do not respond to requests from CMS may see claims denied or their Medicare certification revoked.
This is the latest development in CMS’ response to a surge of newly licensed hospices in California, Arizona, Texas and Nevada. Many of these have been accused of gaming the Medicare system and delivering poor-quality care.
In some instances, multiple hospices have been operating out of the same address without a corresponding increase in the population of eligible patients. Some individuals also hold management positions at several of these hospices simultaneously.
The resulting outcry from hospice organizations and lawmakers has led CMS to publish hospice ownership data, as well as propose a number of regulations. These include a 36-month ownership rule, updated mandates for certifications and denials, as well as restrictions on the types of providers who can prescribe certain medications.
The agency’s proposed hospice rule 2024 also contained a number of requests for information related to strengthening program integrity, as well as a provision that would require all physicians who order or certify hospice services for Medicare beneficiaries to be enrolled in Medicare or validly opted out.
“CMS is looking closely at the hospice industry, as we have increasing concerns about fraud, waste and abuse in this space,” the agency indicated in a statement. “While this rule takes initial steps, this is part of a larger effort by CMS to address hospice fraud, waste and abuse that will continue this year.”
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