The provision of therapy services continues to be a focal point of government regulators. In its 2016 Work Plan, the OIG states that it will continue to review the provision of therapy in nursing homes, citing past findings of overutilization and fraudulent billing of such services. The OIG, in conjunction with the U.S. Department of Justice, has been active in prosecuting alleged therapy billing compliance issues, resulting in multi-million dollar settlements with nursing home providers, with several high-profile investigations still pending. RAC and ZPIC audits focusing on therapy services continue throughout the country. In September 2015, the OIG issued a report entitled "The Medicare Payment System For Skilled Nursing Facilities Needs To Be Reevaluated" which concluded that Medicare payments for therapy services greatly exceeded nursing facility costs, and that the current system encourages nursing homes to bill therapy services at the highest levels possible, in order to maximize reimbursement, without a corresponding demonstration of beneficiary need.
Given this heightened scrutiny, it is more important than ever for nursing facilities to carefully review the provision of therapy services to their residents. Contractual arrangements with outside therapy providers should be structured to ensure that therapy services are provided timely and documented in accordance with applicable law. Therapy services should be routinely audited to determine continued compliance with regulatory requirements. Where irregularities are identified, it is critical to conduct a swift and thorough investigation to determine whether any self-disclosures or refunds of monies are required.
We recommend that all nursing facilities review their existing therapy relationships to ensure that current operations are consistent with law. If you have any questions regarding the increased governmental scrutiny of therapy services, or would like to discuss how to address these issues in the context of your own operations, please do not hesitate to contact Kimber Latsha or David Marshall at (717) 620-2424.