The New Discharge Planning Rule – Get Ready for Fraud!

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Original story posted on: November 25, 2019

Discharge Planning Conditions of Participation is effective Friday, Nov. 29, 2019.

In a news release issued late last month, the Centers for Medicare & Medicaid Services (CMS) included the following statement:

“The Centers for Medicare & Medicaid Services (CMS) today issued a final rule that empowers patients to make informed decisions about their care as they are discharged from acute care into post-acute care (PAC), a process called ‘discharge planning.’ In addition to improving quality by improving these care transitions, today’s rule supports CMS’s interoperability efforts by promoting the seamless exchange of patient information between healthcare settings and ensuring that a patient’s healthcare information follows them after discharge from a hospital or PAC provider.”

“The final rule revises hospital discharge planning requirements for long-term care hospitals (LTCHs) and inpatient rehabilitation facilities, inpatient psychiatric facilities, children’s hospitals, cancer hospitals, (IRFs), critical access hospitals (CAHs), and home health agencies (HHAs). Each of these facilities must meet these requirements as a condition of participating in Medicare and Medicaid programs. Among other things, it requires the discharge planning process to focus on the patient’s goals of care and treatment preferences.”

Let the fraud begin. Have we learned nothing from False Claim Act actions and settlements? 

By making the acute-care hospitals create a discharge plan that “requires the discharge planning process to focus on the patient’s goals of care and treatment preferences,” you allow the discharge planners to potentially steer patients to specific skilled nursing homes in return for kickbacks. This is exactly what happened with the action against Hebrew Homes, settled for $17 million in 2015.

In June 2015, the U.S. Department of Justice issued the following announcement:

“Hebrew Homes Health Network Inc., its operating subsidiaries and affiliates, and William Zubkoff, the former president and executive director of Hebrew Homes Health Network Inc. (collectively, Hebrew Homes), have agreed to pay $17 million to resolve allegations that Hebrew Homes violated the False Claims Act by improperly paying doctors for referrals of Medicare patients requiring skilled nursing care.”

Hebrew Homes committed this fraud by paying multiple physicians with admitting privileges hundreds of thousands of dollars to put their patients into Hebrew Home skilled nursing facilities. It is a well-known dirty secret in South Florida that discharge planners are often bribed to send patients to particular skilled nursing homes. By requiring discharge for post-acute care, you will force acute-care hospitals to hire more discharge planners that are susceptible to this type of corruption.

Timothy Powell, CPA

Timothy Powell is a nationally recognized expert on regulatory matters, including the False Claims Act, Zone Program Integrity Contractor (ZPIC) audits, and U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) compliance. He is a member of both the RACmonitor and ICD10monitor editorial boards and a national correspondent for both Monitor Mondays and Talk Ten Tuesdays.

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