The Senate Finance Committee recently released a report describing the Committee’s findings based on an investigation into Amedisys, LHC Group, Gentiva, and Almost Family, four of the largest publicly-traded home health care companies.  See Report part I and part II.  The Committee alleges that home health care companies “gamed” the Medicare reimbursement system for therapy visits to the homes of eligible Medicare beneficiaries.

Until January 2008, Medicare paid $2,200 for up to nine home therapy visits. When a tenth home therapy visit was made, Medicare would pay home health care providers an additional $2,200.  According to CMS, prior to 2008, 10-13 visits were the most prevalent number of visits.  The Committee’s report claims that Amedisys, LHC Group, and Gentiva “encouraged therapists to target the most profitable number of therapy visits, even when patient need alone may not have justified such patterns.” 

Under new rules that took effect in 2008, therapy thresholds were set at 6, 14, and 20 visits.  The Committee's Report alleges that during each 60-day period, home health agencies would receive “substantially higher payout[s]” for episodes in which the number of visits reached these new thresholds.  The Committee’s report alleges:  “Home health agencies rapidly altered their treatment patterns to match the new system, producing what [the Medicare Payment Advisory Commission] called ‘the swiftest one-year change in therapy utilization since [the prospective payment system] was implemented.’”  The number of episodes near the old thresholds allegedly dropped approximately 28 percent while the number of episodes near the new thresholds increased by as much as 30 percent. 

The Committee’s report is the latest development in an investigation of the home health care industry that began shortly after the Wall Street Journal published an article in April 2010 stating that Amedisys’ therapy visit reimbursement claims “cluster[ed]” around the ten visit threshold.  In May 2010, the Senate Finance Committee requested documents from each company identified in the Wall Street Journal article.  The Department of Justice issued a CID to Amedisys later that year.  As we mentioned in our October 7, 2010 post, the issuance of a CID means that an investigation under the False Claims Act is in progress. 

Amedisys and Gentiva deny the allegations in the Senate Report.  See Amedisys Press Release and Gentiva Press Release.  Almost Family also denies any wrongdoing and points out that the Committee’s report found that “none of the documents provided to the committee by Almost Family show that executives ever pushed therapists to target thresholds or to pursue more profitable clinical regimens.”  See Almost Family Press Release.  LHC Group entered into a settlement with the Government for $65 million, but did not admit any wrongdoing.  See LHC Group Press Release Regarding Senate Report and LHC Group Press Release Regarding the Settlement.