Monthly Stipends Not Allowed

by Elizabeth E. Hogue, Esq. | Jun 20, 2025 | Admin, Legal

by Elizabeth E. Hogue, Esq.

Medical Directors:

Monthly Stipends Not Allowed

Monthly stipends to Medical Directors for referrals of patients could cost you. Earlier this month, a hospice provider in Georgia settled claims of violation of the federal Anti-Kickback statute (AKS) and the federal False Claims Act (FCA) by agreeing to pay $9.2 million. The allegations include payments of kickbacks, including monthly stipends, to Medical Directors in exchange for referrals of patients. These practices resulted in three whistleblower lawsuits against the hospice by former employees. They will receive $1.5 million.

Marketing, not Monthly Stipends

In the meanwhile, marketing strategies utilized by post-acute providers are generating fierce competition for referrals, especially Medicare beneficiaries who need home health services! As a result, providers are appropriately committing more and more resources to marketing activities. Providers are, for example, entering into agreements with referring physicians to provide consulting services to their organizations. These legitimate relationships may easily be misunderstood by enforcers.

Consulting Physicians

First, it is important to acknowledge that providers of services in patients’ residences need consulting physicians’ services. Examples of services that are genuinely needed, from a business perspective, may include the following:

Consultation regarding clinically complex cases
Assistance with the development and maintenance of specialty programs
Communication with physicians who provide inappropriate orders for care, do not return signed orders on time, or are unresponsive to staff members who are seeking modifications to treatment plans

As providers know, however, these types of arrangements raise important legal issues related to potential violations of the AKS, the federal so-called Stark laws, the FCA, and state statutes that are probably similar to these federal statutes.

Avoid Trouble with Specific Contracts

Providers are likely to avoid violations if they meet the requirements of the personal services “safe harbor” under the AKS and the contractual exception under the Stark laws. The safe harbor and exception generally require providers to pay consulting physicians who also make referrals to them based upon written agreements that require payments at fair market value for services actually rendered without regard to the volume or value of referrals received.

Practically, Providers Should:

Pay physicians who also make referrals
- on an hourly basis
- not a set monthly amount of stipends
Develop standardized agreements and use them consistently with all referring physicians who receive consulting fees
- Providers cannot afford to use a variety of different agreements that may not meet applicable requirements
- Staff must understand that they can use only the standard approved agreement and cannot modify it without advance written approval from a designated, knowledgeable individual
Document services rendered and the amount of time spent on these activities.
- Documentation is crucial
- Providers should develop and implement policies and procedures that permit payments to physicians only after appropriate documentation to support payments has been received and reviewed
Avoid agreements for consulting services with physicians whose services they do not actually use
- even if they make no payments to them
- terminate these agreements if they do not need the services covered by them or it may appear that the only purpose for the agreements is to induce referrals as opposed to a documented need for services
Avoid having numerous consulting physicians/medical directors
- Although there are usually no limits on the number of consulting physicians/medical directors that providers can have at any given time, a very large number is likely to invite scrutiny by regulators and should be avoided
- How many is too many? The number should certainly bear some relationship to the size of the provider organization and the geographic area served.
- Beyond this general guideline, common sense must prevail. The bottom line is: does the provider have legitimate work for every consulting physician?
Avoid asking consulting physicians to perform commercially reasonable services that are related to the volume and value of referrals made
- Providers cannot, for example, ask referring physicians to assist with quality assurance activities that
  - Entail their review of charts of patients whom they referred to the provider
  - Ensure the more referrals made, the more money consulting physicians make

Final Thoughts

Providers are more likely to avoid enforcement activities when they follow these practical guidelines. Violations hurt providers and referral sources alike. In view of the possible adverse consequences, expenditures of financial and other resources are certainly justified to get it right.

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Elizabeth Hogue is an attorney in private practice with extensive experience in health care. She represents clients across the U.S., including professional associations, managed care providers, hospitals, long-term care facilities, home health agencies, durable medical equipment companies, and hospices.

No portion of this material may be reproduced in any form without the advance written permission of the author.

Painting Pictures

by Elizabeth E. Hogue, Esq. | Jun 13, 2025 | Admin, Clinical, Home Health, Hospice

by Elizabeth E. Hogue, Esq.

"Painting Pictures" of Patients

Painting Pictures in clinical documentation to achieve positive audit results. As the fight against “fraud, abuse and waste” continues, responding to audits has become an ongoing burden for many providers. Providers have repeatedly been urged to “paint a picture” of patients in clinical documentation in order to help achieve positive results. “Painting a picture” of the patient, however, may have become more difficult as the use of electronic health records (EHRs) has increased. That is, it’s difficult to adequately describe patients’ conditions when there are so many boxes to check and blanks to fill in.

Copy, Paste, Repeat

When it comes to narrative descriptions of patients’ conditions, it is extremely tempting to “copy and paste,” “cut and paste” and/or “copy forward” previous documentation in the EHR. The copy and paste feature allows users to use the content of another entry and to select information from an original or previous source to reproduce in another location. The copy forward capability replicates all or some information from a previous note to a current note, while the cut and paste feature removes documentation from the original location and places it in another location. In addition to the obvious potential problems for quality of care related to the use of these functions, auditors are understandably skeptical of documentation that repeats itself throughout patients’ medical records.

Painting Pictures of Fraud

Auditors are especially likely to deny claims that include documentation that was obviously copied using the above functions, when the information copied “sticks out like a sore thumb.” If hospice staff document, for example, that “the patient eats a lot of Mexican food” over and over in clinicians’ visit notes, auditors are understandably skeptical about whether services were necessary for a hospice patient who seems to have a continuous robust appetite or whether services were, in fact, rendered.

How to Paint the Picture

What does it mean to “paint a picture?” If a home health patient needs wound care or injections of medications, for example, the “picture” must account for why patients or their caregivers are not performing these activities themselves. Clinicians need to describe the following in a “picture” of the patient:

Does the patient live alone or have caregivers?
Why can’t patients do wound care or self-inject medications
Why can’t caregivers perform these activities?
What attempts did clinicians make to assist patients and caregivers to provide wound care and injections?
Why were these attempts unsuccessful?
What attempts were made to find other caregivers – either paid or voluntary – who might provide these types of care?
What were the results of these attempts to find other caregivers?
Despite the initial inability of patients and caregivers to render this care themselves, what efforts did clinicians make to help ensure that they became able to do so?

Get the Picture?

It’s difficult, if not impossible, to paint the above picture using only the boxes and blanks of forms in EHRs. More is needed if providers are serious about positive audit results.

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No portion of this material may be reproduced in any form without the advance written permission of the author.

©2025 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in The Rowan Report. One copy may be printed for personal use: further reproduction by permission only. editor@therowanreport.com

Elderspeak

by Elizabeth E. Hogue, Esq. | May 29, 2025 | Clinical

by Elizabeth E. Hogue, Esq.

Elderspeak

Providers have all heard baby talk. Baby talk is just one kind of elderspeak, i.e., changes in the way caregivers speak to patients, especially elders, regardless of the person’s ability to understand and respond.

Elderspeak includes:

Using a singsong voice, i.e., an exaggerated melodious tone
Changing pitch and tone to a higher level
Exaggerating words
Using terms like “honey” or “dear”
Using statements that sound like questions
Slow speech at a deliberate pace
Speaking at a higher volume than normal
Using simple, basic words
Substituting collective pronouns, such as “we” instead of “you”
Lack of eye contact
Use of so-called tag questions, such as “It’s time to eat lunch now, right?”

For Example:

A daughter visited her father in his apartment in an assisted living facility. She heard an aide trying to get her father to do something. The aide said, “Let me help you, sweetheart.” Dad’s response: “What? Are we getting married?”

Negative Results

Research shows that using elderspeak can diminish patients’ confidence in their abilities. Elderspeak is, after all, based on an ageist assumption of frailty, incompetence, and dependence. It can also be controlling and bossy. The use of “we” instead of “you” implies that patients are not able to act as individuals. Use of elderspeak may result in resistance to care.

When and How to Use Elderspeak

Some elderspeak does help to compensate for changes in cognition, but most of the time it’s confusing or even harmful to use elderspeak because it adversely affects a senior’s ability to understand. What is helpful?

Based on scientific evidence that older adults experience changes in their working memories that affect the way they hear and understand what is said to them, here’s what may be helpful:

Repeat and paraphrase what you say
Simplify and be explicit

Don’t say, for example, “I ate dinner later than usual yesterday, which made my stomach upset, so I missed the class that I enjoy taking.” Instead, say, “I ate dinner late yesterday. My stomach was upset, so I missed the class I like.” In other words, express complex ideas in a chain of simple sentences. Then repeat the main point or say it again another way.

Final Thoughts

Old habits are hard to break, but avoiding elderspeak is important because effective communication is essential to quality of care.

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Shoot the Messenger

by Elizabeth E. Hogue, Esq. | May 16, 2025 | Admin, Regulatory

by Elizabeth E. Hogue, Esq.

Shoot the Messenger at Your Own Risk

Shoot the messenger of fraud and abuse at your peril. Providers must take seriously the concerns of employees about possible fraudulent and abusive practices. Most whistleblowers take their concerns to their employers first, especially if they are required to do so by employers’ Compliance Plans. When employers ignore their concerns or, even worse, retaliate against employees or contractors for raising issues in the first place, employees may turn to outside enforcers for assistance in addressing their concerns. Providers must take employees’ allegations seriously whether or not they are valid. Thorough investigations are required in order to demonstrate to employees that there is no problem or that the problem has been corrected.

Qui Tam

Private citizens may initiate so-called “whistleblower” or qui tam lawsuits to enforce prohibitions against fraud and abuse in the Medicare, Medicaid, and Medicaid Waiver Programs and other state and federal health care programs, such as VA and Tri-Care.

False Claims Act

One of the federal statutes that allows for whistleblower actions is the False Claims Act (FCA). This Act generally prohibits providers from “knowingly” presenting or causing to be presented false or fraudulent claims for payment by the government. Whistleblowers continue to be a major source of information for government enforcers.

Whistleblower Requirements

In order to bring a qui tam action under the FCA, private parties must have direct and independent knowledge of fraud by providers against whom suits are filed. Thus, current or former employees who are familiar with providers’ practices may often initiate whistleblower actions under the FCA. As you can imagine, employees and contractors who are ignored or retaliated against when they bring possible violations to the attention of employers or partners by firing them, for example, are likely to initiate whistleblower suits.

Here is an example:

In United States ex rel. Chorches v. American Medical Response [No. 15-3920 (2d Cir. July 27, 2017)], Paul Fabula worked as an emergency medical technician (EMT) for American Medical Response. Fabula realized that his employer fraudulently sought reimbursement from the Medicare Program by falsely claiming that ambulance services were medically necessary when they were not. Specifically, EMTs were asked to falsify electronic Patient Care Reports (PCRs) to make it appear that services were medically necessary. Supervisors printed copies of PCRs, revised them, and directed staff members to sign the revised forms.

In one instance, Fabula provided services with another staff member who prepared the PCR. A supervisor instructed the staff member to fraudulently revise the form. When the staff member refused, the supervisor directed Fabula to sign the revised form. When Fabula refused, he was fired.

Don't Shoot the Messenger

What did Fabula do? Why, of course, he filed a whistleblower suit! The message from this case and numerous others is clear: don’t shoot the proverbial messenger who brings information about possible fraud and abuse violations. Listen up!

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Home Care Nurses’ Proud History

by Elizabeth E. Hogue, Esq. | May 9, 2025 | Caring for the Caregiver, Clinical

by Elizabeth E. Hogue, Esq.,

It's National Nurses Week!

Home Care Nurses, it’s National Nurses Week, May 6 – May 12, 2025, so we are celebrating the profession of nursing!

Home Health Nurses Have a Proud History

Home care nurses have an especially proud history. Perhaps the definitive book on home care nursing is No Place Like Home: A History of Nursing and Home Care in the United States authored by Karin Buhler-Wilkerson in 2001. As Buhler-Wilkerson makes clear, home care nursing in the U.S. is modeled on care provided in patients’ homes that was initiated by William Rathbone in Liverpool, England, in 1859.

The Start of Home Health Nursing

Rathbone first encountered a home care nurse, Mary Robinson, during the illness of his wife. Rathbone persuaded Robinson to work with him in an experiment to provide care for the sick poor in their homes while simultaneously teaching them how to take better care of themselves. Robinson was so shocked and overwhelmed by the work that she was ready to quit after the first three months. A key difficulty was recruiting nurses for such difficult work. Rathbone then enlisted the help of Florence Nightingale.

Nightingale viewed the care of patients in their homes as one of nursing’s most important tasks and threw her wholehearted support behind Robinson’s efforts. According to Buhler-Wilkerson, Nightingale said, in a widely read article published in 1876, that nurses who visited patients in their homes “were not, she assured her readers, some new form of cooks, relief officers, district visitors, letter writers, store keepers, upholsters, almoners, purveyors, ladies bountiful, head dispensers, or a medical comfort shop; they were simply nurses.” Their goal, according to Nightingale, was to “get people going again” with a “sound body and mind.” Nightingale was unsuccessful in recruiting nurses to help Rathbone and Robinson, so Rathbone started a school to train home care nurses.

The Homecare Model Comes to the U.S.

The model of homecare nursing that developed in England was very attractive to women in the U. S. around the turn of the century. Buhler-Wilkerson describes the ideal home care nurse at this time as follows:

“As nurse-author Mary Gardner suggested, the ideal visiting nurse was a faultless creature ‘possessing all the virtues, combining the experience of age with the enthusiasm of youth, and also having a sense of humor, which is perhaps the only thing which will make the years’ of this kind of work possible.’”

Not for the Faint of Heart

The work was extremely arduous. As Buhler-Wilkerson says in her book:

“Many nurses, while attracted to visiting nursing, found the work too mentally and physically exhausting. Walking long distances in all kinds of weather, climbing endless flights of stairs, cleaning and disinfecting patients’ rooms, changing beds, and being constantly exposed to disease were all part of the visiting nurse’s daily routine. The ‘delicate’ nurse found this an impossible undertaking, but even the strongest became exhausted – even sick – at the end of a day of work…Fatigued, discouraged, and often sick, many nurses left for more lucrative or easier work…As a result, the turnover was high and replacements difficult to find. With a large proportion of the staff leaving, each year seemed a new enterprise.”

Karin Buhler-Wilkerson

No Place Like Home:, A History of Nursing and Home Care in the United States

Sound Familiar?

The same description certainly fits home care nursing today. The work of home care nurses is difficult, but crucial to our country. Hats off to homecare nurses today and every day!

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That’s a No-No

by Elizabeth E. Hogue, Esq. | Apr 24, 2025 | Admin, Hospice, Medicaid, Medicare, Medicare Advantage, Regulatory

by Elizabeth E. Hogue, Esq.

No-no # 1

“No-No” may seem like something you would say to a toddler, but there is a list of things agency owners do that they should not do. Many of these are things providers may not often consider. This article focuses on the use of private duty services by hospice and home health patients, and what hospices and home health agencies cannot do with regard to aide services.

Aide Services

Both home health and hospice services are usually intermittent and provided in patients’ homes. Patients and their families may elect to utilize the services of private duty/home care companies for additional assistance. At the same time, hospice and home health patients may receive aide services from hospices and home health agencies.

Conditions of Participation

According to Medicare Conditions of Participation (CoPs), hospice and home health aides can only provide personal care services, including bathing. Aides provided by private duty/home care companies may also provide personal care. Unlike aides provided by hospices and home health agencies, however, they can provide additional services; such as laundry, food preparation, light housekeeping, shopping, and running errands.

Private Duty Services

When patients use private duty services, they are often paying for these services out of their own pockets. Even if they have long-term care insurance, patients still bear the financial burden of paying for private duty services. Longterm care insurance often costs thousands of dollars that patients probably paid for themselves. Patients usually pay by the hour for these services.

That's a No-No

Patients may, of course, utilize private duty/home care services to perform any of the services described above. It seems, however, that hospices routinely tell patients who have private duty/home care that they will not provide aide services because private duty/home care aides are able to provide personal care for patients.

Breaking it Down

Here is an example: A hospice admitted a bedridden patient with urinary and fecal incontinence. The patient and caregiver requested aide services from the hospice five days a week to bathe him. He paid for a few hours of private duty/home care services each day. The hospice refused to provide aide services five days a week to bathe him because he had private duty/home care services. No-no!

Compelled to Provide Care

ospices must provide aide services consistent with patients’ needs related to their terminal illnesses. In the example above, the patient clearly had a need for aide services five days a week. If patients and their caregivers state that they prefer to use private caregivers for personal care, then hospices must document the refusal of hospice aide services offered, consistent with applicable standards of care. Then hospices are not required to provide aide services.

Profiteering

When hospices deny aide services that are consistent with applicable standards of care and require patients and caregivers to use private duty/home care services, hospices are shifting the cost of aide services onto patients and their families. Patients and their families may have to pay for additional private duty/home care services to meet patients’ needs. The result for hospices is that they do not incur the costs of aide services, thereby increasing their profits at the expense of patients and their families.

If hospice staff members who refuse to provide aide services to patients and require patients and their families to use private duty/home care services instead are compensated in any way based on the financial performance or profitability of the hospices, let’s hope they look good in orange jumpsuits!

Intent to Defraud

If the private duty/home care services are being paid for by any federal or state health care program; such as Medicaid, Medicaid waiver, VA, or TriCare; then both home health agencies and hospices have engaged in fraudulent conduct by shifting costs that they should have incurred onto other federal government programs.

God forbid that the hospice also owns the company from which patients receive private duty/home care services! Then hospices are limiting their costs while profiting from patients and their families.

Dig Deep and Find Your No-No's

Now is the time for all home health agencies and hospices especially to audit patients’ records to make certain that all patients have been offered services that they are required to provide. If patients and their families choose to use private duty/home care aides instead, documentation must show that they were offered the services but chose to use private duty/home care aides.

No-No's Final Thoughts

The bottom line is that hospices and home health agencies must always provide services needed by patients. Patients may choose to pay for services that are paid for by the Medicare hospice or home health benefits. Patients cannot be required to pay for services privately that hospices and home health agencies must provide. Unacceptable!

This article is the first in a series of “No-no” items for agency owners.

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Relief for Providers

by Elizabeth E. Hogue, Esq. | Apr 11, 2025 | Admin, Audits, CMS, Medicare, Regulatory

by Elizabeth E. Hogue, Esq.

Relief for Providers from Devastating Penalties?

A judge in the Northern District of Texas recently decided that even the minimum penalties mandated under the False Claims Act (FCA) violate the Eighth Amendment’s Excessive Fines Clause [see U.S. ex rel. Taylor v. Healthcare Associates of Tex. (N.D. Tex. Feb. 26, 2025)]. The FCA punishes providers for submission of information that is not true in order to get paid by the federal government.

Life Threatening Penalties

The penalties assessed against providers under the FCA may be described as “life threatening.” That is, it may be difficult for providers’ businesses to survive payment of such severe penalties. The minimum penalty increased from $13,946 to $14,308 in 2025. The maximum penalty per claim increased from $27,894 to $28,619.

Ex Post Facto

These increased penalties will be assessed for violations that occurred prior to the change, but that are assessed after they are in effect. These penalties certainly make it clear why it is difficult for providers to survive violations of the FCA.

False Claims

In the Taylor case above, for example, the defendants allegedly submitted false claims as follows:

As “incident to” a physician’s care without proper documentation
For services by providers who were not eligible to bill the Medicare Program
For services performed by medical assistants instead of qualified practitioners

FCA Math Doesn't Add Up

The jury found that one of the defendants, a primary care medical group practice, submitted 21,944 false claims for $2,753,641.86 in actual damages. After trebling the damages as required by the FCA, the Court said it would enter judgement against the defendant for approximately $8 million. The Court acknowledged, however, that penalties under the FCA are fines subject to the Eighth Amendment of the U.S. Constitution.

Grossly Disproportional to the Gravity

The Court then applied the following four factors to decide whether the “fine was grossly disproportional to the gravity of the offense” under the Eighth Amendment:

The essence of the defendant’s crime and its relationship to other criminal activity
Whether the defendant was within the class of people for whom the statute of conviction was principally designed
The maximum sentence, including the fine that could have been imposed
The nature of the harm resulting from the defendant’s conduct

Fraud...or a Reporting Error?

With regard to the first factor, the Court emphasized that the defendant’s misconduct involved violations of Medicare billing rules, but did not include billing for services that were not provided. In fact, the Court said that even though the defendant violated Medicare billing rules, the misconduct was “closer in gravity to something like a ‘reporting offense.’” There was, said the Court, no evidence that the defendant’s conduct was “related to other criminal or fraudulent activity.

Magnitude of Harm

The Court also focused attention on the fourth factor. The defendant’s harm was certainly significant, but the harm, according to the Court, did not necessitate a penalty “two orders of magnitude greater than the actual financial harm,” especially when the actual damages were substantial, i.e., one hundred times the amount of actual damages. That ratio was “grossly out of alignment with the ratios in other similar cases.” The Court imposed a civil penalty of $8,260,925.58 that represents less than 3% of the statutory minimum.

Final Thoughts

Whether other Courts follow the Taylor case described above remains to be seen, but it is quite clear that providers need relief from the penalties of the FCA.

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More Violence in Care at Home

by Elizabeth E. Hogue, Esq. | Mar 21, 2025 | Admin, Caregiver Safety, Caring for the Caregiver, Clinical

by Elizabeth E. Hogue, Esq.

Violence Against Home Care Providers Continues

Violence in Care at Home Continues…

Sadly, but not surprisingly, the violence against field staff caring for patients in their homes continues. Here’s a recent example:

On February 28, 2025, a hospice nurse in Texas was accosted inside a patient’s home while she was attempting to provide care. The man who accosted her inside the home followed her outside with a rifle and fired at her as she fled. The nurse was uninjured, but her car was struck by at least one bullet.

Then, still armed, the man went back inside the patient’s home where he stayed close to the patient while pointing his rifle at deputies. Law enforcement officers were able to communicate with him and de-escalate the tense situation. The man was booked into the county jail on a charge of aggravated assault with a deadly weapon and bond was set at $250,000.

By the Numbers

According to a recent analysis of Bureau of Labor Statistics data, healthcare is one of the most dangerous places to work. Homecare field staff members who provide services on behalf of private duty agencies, hospices, Medicare-certified home health agencies, and home medical equipment (HME) companies may be especially vulnerable. Contributing to their vulnerability is the fact that they work alone on territory that may be unfamiliar and over which they have little control. Staff members certainly need as much protection as possible.

Violence Policies Needed

First, regardless of practice setting, management should develop a written policy of zero tolerance for all incidents of violence, regardless of source. This policy should include animals. The policy must require employees and contractors to report and document all incidents of threatened or actual violence, no matter how minor.

Beyond Reporting

Emphasis should be placed on both reporting and documenting. Employees must provide as much detail as possible. The policy should also include zero tolerance for visible weapons. Caregivers must be required to report the presence of visible weapons.

UCHealth SAFE Program

Below are some additional important actions for healthcare organizations to take that are based on the UCHealth SAFE Program:

Encourage staff members to STOP if they feel unsafe for any reason.
If danger is not imminent, workers should pause to generally ASSESS their environments. Staff members should think about what happened and observe what is currently happening. Is there, for example, mounting frustration or anger?
Staff should then FAMILIARIZE themselves with the area. Who is the patient? Where is the patient? Are there any factors that might escalate behaviors? Staff members should also consider putting themselves in positions where they have a route to escape, if necessary.
ENLIST help. Getting help may, for example, include pushing panic buttons on mobile devices.

In Their Own Words

Here is what Chris Powell, Chief of Security at UCHealth, said in Becker’s Hospital Review on June 4, 2024:

“You can’t just talk about the shrimp and give you a good picture. We have to talk about the roux and the rice and everything else that goes into this for a good picture to be painted so people have an understanding. We want to solve this with an electronic learning or a 15-minute huddle, but we can’t. This is continuous and a persistent pursuit toward educating, communicating, recognizing, responding to, reporting and recovering from workplace violence.”

Chris Powell

Chief of Security, UCHealth

Final Thoughts

Every caregiver matters. The healthcare industry has lost caregivers to violence on the job in the past. Let’s do all that we can to avoid similar events in the future.

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Nursing Facility Compliance Guidance

by Elizabeth E. Hogue, Esq. | Mar 13, 2025 | Admin, Clinical, Regulatory

by Elizabeth E. Hogue, Esq.

Nursing Facility Compliance Guidance

Takeaways for Hospices

In November of 2024, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services issued revised “Nursing Facility Industry Segment-Specific Compliance Program Guidance.” This guidance describes:

Risk areas for nursing facilities
Recommendations and practical considerations for mitigating risks
Other important information that the OIG believes nursing facilities should consider when implementing, evaluating, and updating their compliance and quality programs

Guidance Extends to Post-Acute Providers

The guidance targets nursing facilities. Howeve, it also clearly states that post-acute providers other than nursing facilities should use the guidance in their compliance efforts. The OIG says: “We encourage all long-term and post-acute providers to establish and maintain effective compliance and quality programs.” Guidance for nursing facilities, for example, specifically addresses relationships between nursing facilities and hospices.

The OIG...

First...

acknowledges that nursing facilities may arrange for hospice services for patients who meet the eligibility criteria and who elect the hospice benefit.

Then...

reminds facilities and hospices that requesting or accepting remuneration from hospices may subject both parties to liability under the federal anti-kickback statute. This applies if the remuneration may influence nursing facilities’ decisions to do business with hospices or induce referrals between the parties.

Goes On...

points out that nursing facilities that refer patients for hospice services who do not qualify for the hospice benefit may be liable for submission of false claims.

Nursing Facility Compliance Guidance OIG

Additionally...

says that hospices are permitted to furnish noncore services under arrangements with other providers or suppliers, including nursing facilities. State Medicaid Programs pay hospices at least 95% of the Programs’ daily facility rate. Hospices are then responsible to pay facilities for patients’ room and board.

Finally...

provides a list of suspicious arrangements between nursing facilities and hospices, including: (1) referrals of patients to hospices to induce hospices to refer patients to facilities, and (2) solicitation or receipt of hospices of goods or services for free or below fair market value, including nurses or other staff to provide services at facilities for nonhospice patients and monetary payments for:

referrals of patients to hospices to induce hospices to refer patients to facilities
solicitation or receipt of hospices of goods or services for free or below fair market value
- solicitation of nurses or other staff to provide services at facilities for nonhospice patients
- monetary payments for:

- - Room and board for patients in excess of what nursing facilities receive directly from Medicaid if patients are not enrolled in hospices. Additional payments must represent fair market value of additional services actually provided to patients that are not included in Medicaid daily rates.
  - Additional services for residents that include room and board payments to hospices from Medicaid Programs
  - Additional services for patients that are not included in room and board payments from Medicaid Programs at rates that are above fair market value
  - Provision of services by nursing facilities to hospice patients at rates that are above fair market value

Final Thoughts

Hospices are surely under fire these days from fraud enforcers. Engaging in the practices described above is likely to draw attention by enforcers and possible enforcement action.

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Update on Public Participation in Rule Making

by Kristin Rowan | Mar 13, 2025 | Advocacy, CMS, Medicare Advantage, Regulatory

by Kristin Rowan, Editor

Update

Last week, we reached out to some of our contacts for responses to this change.

Former President of NAHC and current Senior Counsel at Arnall Golden Gregory Bill Dombi said:

It is difficult to discern the impact of the rescission of the waiver. One concern is whether the administration considers Medicaid a grant or benefit program thereby exempting it from APA public notice and comment rulemaking.

With respect to Medicare, if it is considered a benefit, there is still a Medicare statutory requirement of public notice and opportunity for comment through formal rulemaking that should effectively nullify the practical impact of the rescission of the waiver. All that said, we will need to see more before being to judge the impact.

Frequent guest author and Fellow, American Health Law Association, Elizabeth E. Hogue, Esq. had this to say:

Recission of the Richardson Waiver is not good news for providers.

Many federal agencies voluntarily committed to give notice and comment for actions that otherwise would be exempt. The US Department of Health and Human Services was one of the federal agencies that adopted this policy in October, 1970, in a memorandum commonly referred to as the “Richardson Waiver.” This policy was published in the Federal Register in 1971. HHS did not, however, promulgate the Waiver through notice and comment rulemaking.

The open process of give and take between agencies and providers under the Richardson Waiver resulted in resolution of important issues relatively informally. Now it appears that only policies mandated by statute will go through the rulemaking process. In other words, opportunities to resolve issues without formal resolution will be compromised.

The recission of the Waiver may also make administration of both the Medicaid and Medicare programs more complicated and less effective, especially in view of US Supreme Court decisions that say everything that hasn’t gone through the notice and comment process is not binding on providers.

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Below is the original article, published March 6, 2025

Public Participation Rescinded

The Administrative Procedure Act (APA) requires that an agency public a notice of proposed rulemaking in the Federal Register; allow sufficient time for public participation via written data, views, or arguments; and then publish a final rule. Matters relating to agency management, personnel, or public property; loans, grants, benefits, or contracts; and for “good cause” are exempt from the reporting requirements. The Richardson Waiver, adopted in 1971, waived the exemption and instructed agencies to use the good cause exemption sparingly. Effective immediately, the Richardson Waiver is rescinded.

“The policy waiving the statutory exemption…imposes on the Department obligations beyond the maximum procedural requirements specified by the APA, adds costs [that] are contrary to the efficient operation of the Department, and impedes the Department’s flexibility to adapt quickly to legal and policy mandates.”

Robert F. Kennedy, Jr.

Secretary, Department of Health and Human Services

What it Means

Public participation is now optional. Agencies and offices of the Department of HHS can, if desired, use the public notice and comment procedures for these matters, but are no longer required to do so. The Department will continue to follow these procedures in all circumstances in which they are required to do so.

Law firm Hogan Lovells, experts in healthcare law, wrote about the potential implications for the health care industry in a recent blog post. According to the firm, it is unclear how HHS will interpret the “benefits” portion of the exemption. HHS, and specifically CMS, currently uses the notice and comment procedure for various benefits programs, including Medicare and Medicaid. Secretary Kennedy’s statement clearly calls out the limitation in impacting any other law requiring notice and comment periods.

Public Participation in Medicare Rules

Hogan Lovells indicates that few if any policies written under the Medcare Act will be impacted by this change. The Medicare Act operates under additional rulemaking requirements under section 1871(a) of the SSA. Additionally, Azar v. Allina Health Services, 587 U.S. 566 (2019) confirms that Medicare rulemaking is independent from the APA. Some policies are currently exempt from the notice and comment obligations under the Medicare Act and will remain exempt.

Public Participation in Medicaid and CHIP rules

Medicare and CHIP fall under Title XIX of the SSA, which does not contain its own notice and comment requirements separate from the APA. HHS has used the APA notice and comment rules for many of the changes made to the Medicaid program. HHS could interpret the “benefits” clause as exempting Medicaid changes from the rule. Hogan Lovells states it is currently unclear whether HHS will take this route. They also purport the courts have not ruled on whether APA excludes Medicaid from the notice and comment requirements, and may not agree with that exclusion. Until the term “benefits” is better defined, Medicaid, CHIP, the insurance exchange marketplace, and TANF, among others, may be impacted.

Department of Veterans Affairs

A notable exception to these changes is the rulemaking in the Department of Veterans Affairs as it relates to the Veterans Health Care act of 1992. This program implemented Federal contractor requirements that established pricing and contracting standards for drug manufacturers. The VA policies and rules have historically been enacted using guidance letters, avoiding the rulemaking process altogether.

Final Thoughts

There is too much that is yet unknown regarding this change to understand its full impact. There will be immediate changes, court rulings, further changes, and likely a lot of advocacy from national organizations fighting for transparency for Medicare, Medicaid, and other “benefit” programs. This will be an ongoing story and The Rowan Report will bring updates as they happen.

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Kristin Rowan has been working at The Rowan Report since 2008. She is the owner and Editor-in-chief of The Rowan Report, the industry’s most trusted source for care at home news .She also has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in content creation, social media management, and event marketing. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com

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