Medicaid Program: Improper Medicaid Payments for Individuals Receiving Hospice Services Covered by Medicare

Approximately $50 million in actual and potential Medicaid overpayments, cost-saving opportunities, and questionable payments identified for dual-eligibles in Medicare-covered hospice care, including: $5.5 million in overpayments for services not allowed in conjunction with hospice or overlapping with hospice-covered benefits; $370,506 in overpayments for personal care services in excess of 24 hours in a day; $39.8 million in payments for personal care and durable medical equipment and supplies that may have been covered by Medicare hospice; and $4.3 million in unnecessary payments for nursing home room and board under managed care.

$1.1 million in potential overpayments for services likely should have been covered by hospice providers, and $1,093,617 + $74,693 (total $1,168,310) in potential overpayments for services related to hospice terminal diagnoses.

$74,693 in payments for drugs that CMS guidance suggests should not be paid by Medicaid when the recipient is in hospice.

$3,413,546 in potential overpayments for non-hospice services such as CHHA/HHAs, private duty nursing, adult day care, and adult day transportation.

$4.1 million in questionable payments for DME and supplies where the diagnosis may not relate to the terminal illness.

$35.7 million in questionable payments for personal care services where hospice did not provide any aide services (with estimated breakdown and overlapping cases).

$4.3 million in unnecessary payments for nursing home room and board under managed care (part of $85 million in total MLTC payments for dual-eligibles in hospice).

$1.093 million in Medicaid payments for services related to hospice terminal diagnoses that should have been covered by Medicare hospice (e.g., COPD case with duplicate billing).

$527,397 in DME payments and other items where the diagnosis did not relate to terminal illness.

Department has not established sufficient controls to ensure Medicaid payments (FFS and managed care) are appropriate for dual-eligibles receiving Medicare-covered hospice care.

Consider requiring non-hospice service providers to document the reason a service is provided outside of the hospice benefit (e.g., diagnoses or conditions) and, accordingly, not related to a recipient’s terminal illness.

Assess the appropriateness of requiring Medicaid MCOs to pay 95 percent of the nursing home room and board rate for dual-eligibles enrolled in hospice and, if warranted, take steps to implement any changes.

Review the $5.9 million in actual and potential overpayments and ensure proper recoveries are made.

Design and implement a process to identify and track all Medicaid recipients who elect Medicare-covered hospice care (coordinate with CMS, as appropriate).

Establish controls to prevent Medicaid FFS and managed care payments for services that should be covered by Medicare hospice, particularly for the types of services identified in this audit.

Formally remind MLTC plans and LDSS (for recipients not enrolled in MLTC plans) to coordinate services and financial obligations with hospice providers, particularly for personal care and DME and supplies.

Formally remind hospice providers of their role in coordinating services unrelated to recipients’ terminal illnesses with Medicaid providers and MCOs, particularly personal care and DME and supplies.

Monitor MLTC plans and LDSS to ensure they maintain adequate documentation of hospice recipients’ conditions and services that are unrelated to the terminal illness that should be covered by Medicaid when approving services (such as personal care services and DME and supplies).

Update relevant Medicaid policies to coincide with new billing, payment, and policy changes made in response to this audit.