Purpose

To determine whether Medicaid made improper payments to providers on behalf of recipients receiving hospice care. This audit covered the period January 1, 2013 through December 3, 2017.

Background

Hospice is a program that provides care to terminally ill individuals, with a focus on easing symptoms rather than treating the disease. Generally, when eligible Medicaid recipients elect hospice care, they waive their right to use Medicaid for curative services, and a hospice organization assumes responsibility for all medical care related to the terminal illness. Hospice can be provided in the home or in an inpatient setting and includes nursing and physician services, medical social services, drugs for symptom control and pain relief, counseling, and physical and occupational therapy. Medicaid reimburses hospice organizations an all-inclusive daily rate that covers all hospice services. From January 1, 2013 to December 3, 2017, the Medicaid program paid hospice providers about $184 million on behalf of 14,933 Medicaid recipients. Medicaid also paid about $54 million for other (non-hospice) medical services provided to the recipients while they were receiving hospice care.

Key Findings

Auditors identified about $8 million in inappropriate Medicaid payments for services provided to hospice recipients, as follows:

• $2.9 million was paid to non-hospice providers for services, such as private duty nursing, that were not allowed in combination with the daily hospice rate;
• $2.4 million was paid to non-hospice providers for drugs, durable medical equipment, home care, and other services that are covered under the daily hospice rate;
• $2.6 million was paid for hospice services that should have been covered by Medicare or a Medicaid managed care organization; and
• $107,141 was paid for hospice services while the patient was in the hospital.

Key Recommendations

• Review the $8 million and ensure proper recoveries are made.
• Clarify hospice program billing requirements and advise providers accordingly.
• Improve controls to prevent improper payments for services provided to recipients receiving hospice care.

Other Related Audits/Reports of Interest

Department of Health: Managed Care Premium Payments for Recipients With Comprehensive Third-Party Insurance (2016-S-60)
Department of Health: Medicaid Claims Processing Activity April 1, 2017 Through September 30, 2017 (2017-S-23)