"Nursing homes reap $2b in Medicare slip; US report cites a loophole left by rule change" by Drew Armstrong, Bloomberg News / July 12, 2011
WASHINGTON - Nursing homes collected $2.1 billion in added Medicare payments in the first half of this year, an unintended side effect to a rule change that aimed to clamp down on overbilling, according to a government report.
That's like what, a week's worth of war.
The federal health care program for the elderly and disabled blocked companies in January from assigning therapists to treat groups of patients simultaneously and billing each individually for the total time of the session.
Operators responded by reclassifying patients in smaller group settings and still billed the government as if therapy was provided on a one-on-one basis, according to the unpublished report by the Department of Health and Human Services inspector general. The report didn’t single out companies, but recommended the federal government block further overpayments.
Nursing homes “have a financial incentive to choose group therapy,’’ according to the report, a copy of which was obtained by Bloomberg. It recommended Medicare “take immediate action.’’
Medicare pays $430 to $699 a day for nursing home patients, depending on the amount of therapy. Circumventing the rule change lets operators bill more patients at the highest rate, the report said....
Leading for-profit nursing home chains include Kindred of Louisville, Ky.; Skilled Healthcare of Foothill Ranch, Calif.; Carlyle Group’s HCR ManorCare Inc. in Toledo, Ohio; and Sun Healthcare, based in Irvine, Calif.
Federal officials should close a loophole that’s enabling publicly traded companies to profit and may make the industry a target for broader federal reimbursement cuts, say representatives of nonprofit nursing homes....
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