Medicaid costs for Personal Care Services (“PCS”), designed to allow Medicaid beneficiaries to remain in their homes rather than being institutionalized, totaled approximately $12.7 billion in 2011, representing a 35% increase in spending since 2005. The cost for PCS is projected to grow by approximately 45% by the year 2018, certainly making PCS an area of interest to the federal government. PCS providers should expect to see increased federal oversight and control over these programs.
The Office of Inspector General (“OIG”) published a report in November, 2012 based on its examination of PCS and its findings of significant compliance, payment, and fraud vulnerabilities. The OIG also interviewed Medicaid beneficiaries receiving PCS services and found quality of care problems with PCS attendants, including physical abuse or threats of abuse, property theft, and beneficiary abandonment.
As of August, 2012, the OIG has produced 23 audit and evaluation reports focusing on PCS providers and programs in various states, including one in Louisiana. The Louisiana Department of Health and Hospitals, which oversees PCS programs, concurred with the findings and recommendations in the OIG audit. The OIG’s Office of Investigations and State Medicaid Fraud Control Units also reported an increasing volume of fraud involving PCS. The most commonly reported fraud schemes involved conspiracies between PCS attendants and Medicaid beneficiaries regarding claims for services that were never provided or that were not allowed under the States’ program rules.
As a result of the audits, the OIG reported error rates ranging from 16% to 40% in improper payments by several State Medicaid agencies. The OIG found, in many instances, that PCS payments were improper because the services were: 1) not provided in compliance with state program requirements; 2) not supported by adequate documentation; 3) provided during times when the beneficiaries were in institutional stays reimbursed by Medicare and/or Medicaid; and 4) provided by PCS attendants who did not meet State program qualification requirements.
The OIG also found that existing program safeguards were ineffective. Included in these findings were that States lacked: 1) adequate controls in the prior authorization process to ensure beneficiaries qualified for PCS services; 2) prepayment controls, such as electronic edits to deny claims for PCS services that overlapped with institutional stays; 3) consistent standards for qualifications of PCS attendants and monitoring to ensure attendants had appropriate qualifications; and 4) control over claims submission and billing practices, such as claims that lacked details regarding dates of service and/or the identity of PCS attendants providing services.
The OIG recommended that the Centers for Medicare and Medicaid Services (“CMS”) improve regulatory oversight and monitoring of Medicaid PCS programs and promulgate federal regulations to do so. To accomplish this prong, the OIG recommended that CMS reduce the significant variation among State PCS programs regarding PCS attendant qualifications by establishing minimum federal qualification standards applicable to all PCS reimbursed by Medicaid. The OIG also recommended that CMS improve its and States’ ability to monitor billing and quality of care by requiring States to either enroll all PCS attendants as providers or require all PCS attendants to register with the State Medicaid agency and be assigned a unique identifier. Additionally, CMS should require all PCS claims to include the specific date(s) when services were provided, as well as the identity of the PCS attendant(s) providing the services. The OIG also recommended that CMS create or expand federal requirements and issue operational guidance pertaining to claims documentation, beneficiary assessments, plans of care, and supervision of attendants.
The OIG also recommended that CMS issue guidance to States about adequate prepayment controls, including electronic edits to prevent payments, and usable data to detect overpayments, for PCS when beneficiaries are receiving institutional care paid for by Medicare and/or Medicaid. CMS should also consider whether additional controls are needed to ensure PCS meets program requirements and services are provided.
Based on the increased Medicaid spending for PCS, and the significant vulnerabilities found by the OIG, personal care service providers should expect to see more actions by CMS, as well as State Medicaid agencies, to regulate PCS providers, including in the areas of requirements for documentation of services, billing, qualifications and training for attendants, prepayment edits, and pre- and post-payment reviews.