Operation Restore Trust: Review of Hospice Eligibility at the Visiting Nurse Association of

Texas"

EXECUTIVE SUMMARY:

This report provides the results of our audit of Medicare hospice beneficiary eligibility determinations at the Visiting Nurse Association of Texas Hospice (VNA) in Dallas, Texas. This audit was part of Operation Restore Trust (ORT), a joint initiative among various Department of Health and Human Services components. The ORT seeks to identifiy specific vulnerabilities in the Medicare program and pursue ways to reduce Medicare's exposure to abusive practices.

The objective of our review was to evaluate hospice eligibility determinations for beneficiaries that remained in hospice care for more than 210 days. We also determined the amount of payments made to the Visiting Nurse Association of Texas (VNA) for those Medicare beneficiaries that did not meet the Medicare reimbursement requirements.

Our review included a medical evaluation of VNA's eligibility determinations for 77 Medicare beneficiaries who had been in hospice care for more than 210 days. Of the 77 cases, 55 were active in hospice at the time of our review and represent 28 percent of the 199 patients who were active Medicare hospice beneficiaries at VNA as of February 8, 1996. Our review showed that 25 beneficiaries were not eligible for hospice coverage at the time of admission. One of these 25 beneficiaries became eligible 4 months after his first admission.

Our medical determinations were made by physicians who were consultants to the Texas Medical Foundation, the Texas Peer Review organization (PRO). Staff from the fiscal intermediary, Palmetto Government Benefits Administrators (PGBA), have also reviewed narrative inforrriation written by the PRO physicians as well as data extracted from medical files for each of the 77 cases. The PGBA agrees with the PRO's decisions.

We believe the identified discrepancies with the 25 beneficiaries occurred due to inaccurate prognoses of life expectancy by hospice physicians based on the medical evidence in the patients' files. The VNA received Medicare payments for hospice sefices totaling $1,242,806 for ineligible patients.

We are recommending that the intermediary:

-- Recover payments of $1,242,806 for the 25 beneficiaries who were not eligible for Medicare hospice benefits; Recover payments made on behalf of ineligible beneficiaries after February 29, 1996;

-- Coordinate with the Health Care Financing Administration (HCFA) in providing training to hospice providers and physicians on eligibility requirements for hospice beneficiaries, particularly the requirement for a 6-month prognosis;

-- Analyze utilization trends to identify hospices with large increases in claims for beneficiaries with over 210 days of hospice coverage and conduct medical reviews on a sample of their claims

-- Conduct periodic reviews of hospice claims to ensure the hospices are obtaining sufficient medical information to make valid eligibility determinations.

The intermediary responded to a draft of this audit report on November 18, 1996. The intermediary officials have reviewed information that we provided and they concur with the eligibility determinations made by the PRO physicians. However, they stated that they would be reluctant to recover payments. These officials believe that the beneficiary would be held liable in these situations and HCFA had instructed them to educate providers rather than deny services for the time period in question. The intermediary officials stated that hospice data is currently included in the intermediary's focused medical review data analysis process and its education department regularly conducts education workshops on eligibility requirements for hospice providers and physicians.

We will be working with HCFA on the beneficiary liability issue and the recovery of overpayments from the hospice.