Introduction

ACAP-member Safety Net Health Plans (SNHPs) have an established track record of working to reduce fraud, waste and abuse (FWA) across federal health care programs. Every dollar spent on care that is waste, fraud, or abuse represents a burden on current and future taxpayers as well as a diversion of critical health care resources away from the people whom Medicaid was established to serve.

Managed Long-Term Services and Support (MLTSS) programs provide essential services to Medicaid beneficiaries who need additional assistance to remain in their homes and avoid long-term institutional care settings. But the nature of services delivered through MLTSS programs creates challenges in FWA that are different from those in other federal health care programs—and require different approaches to address.

In its recent CRUSH RFI, CMS included several questions related to FWA in services commonly managed by MLTSS programs, including HCBS service providers. ACAP-member Safety Net Health Plans share the goal of CMS to combat FWA where it exists. This paper distills the experience of several ACAP-member MLTSS plans to highlight best practices and policy recommendations to enhance the stewardship of Medicaid resources in MLTSS programs and improve the quality and sustainability of home and community-based services for beneficiaries.

Background

MLTSS programs help provide long-term care services and supports through capitated contracts to Medicaid managed care organizations. Most of these programs administer home and community-based services (HCBS) designed to help beneficiaries remain in their communities. HCBS services typically include personal care, adult day care, transportation, or meal services.

Safety Net Health Plans have decades of experience in partnering with federal and state stakeholders to administer MLTSS programs. ACAP-member plans’ experiences can be useful to identify best practices and shape constructive policy changes. To this end, ACAP conducted interviews with five Safety Net Health Plans that administer MLTSS products. In the interviews, MLTSS plans detailed the ways in which they identify and combat FWA for HCBS services. They also discussed how certain structures and processes inhibit or enhance MLTSS program integrity.

This report details the findings from the interviews and provides recommendations for how Medicaid managed care plans, states, and Federal policy makers can reduce and combat FWA in MLTSS programs more effectively.

 

Plan Processes

Interviews with ACAP-member MLTSS plans surfaced specific actions that plans themselves can take to better identify and address FWA. They include:

Involving care managers in FWA detection and prevention.
For HCBS services, plans assign each beneficiary a care manager. Upon intake, this care manager typically assesses a beneficiary’s level of care and subsequently engages with the beneficiary on a regular basis to assess the adequacy of services provided and to make adjustments as needed. Accordingly, care managers have the most detailed knowledge about a given beneficiary’s needs and the level of services they are receiving.

Policy Recommendation 1.

State HCBS program requirements should set clear expectations for regular (such as semi-annual) in-person assessments of beneficiaries receiving HCBS by a care manager. Costs for conducting these assessments should be included in the actuarially-sound rates for MLTSS plans.

Integrating FWA identification and prevention into the care management function can be highly effective in proactively identifying risks for FWA and preventing serious offenses. ACAP-member plans that included FWA identification, education, and reporting in their care management team roles reported more confidence in their ability to identify and prevent FWA offenses. These plans also reported submitting a higher volume of FWA offenses to the state as a direct result of having more personnel focused on FWA.

Don’t use Electronic Visit Verification as a crutch.
The 21^st Century CURES Act requires that state implement Electronic Visit Verification (EVV) for all Medicaid personal care and home health services. EVV requires a digital check-in to verify the service, provider, beneficiary, location and time. While these features make it a useful tool to identify and deter FWA, the plans interviewed for this paper reported that EVV is no substitute for in-person oversight. Moreover, over-reliance on EVV can provide a false sense of security and may allow some types of FWA to continue without timely identification. For example, plans indicated that tools like EVV can help identify potential fraud, but such systems can also be circumvented without much sophistication. Especially at the level of personal care services, most fraud is identified through in-person observation in a beneficiary’s home; care managers can identify discrepancies between what is observed in a beneficiary’s home and what is claimed through billing.

Trust, but verify.
Plans also identified fraud by ensuring network service providers (e.g. adult day care programs) maintain their claimed hours of operation and keep accurate records. On some occasions, providers were billing for a full day of service; however, when a plan representative arrived on site, they found that the service provider was not open. Additionally, plans found it valuable to ask the centers for their daily log of members and then reconcile that with attendance records for the center for that day.

Policy Recommendation 2.

States and the federal government should permit MLTSS plans to maintain some discretion in deciding what suspected FWA is referred to the state. Some suspected FWA results from a lack of understanding about allowable billable services that can be addressed through conversations between the MLTSS plan and the beneficiary or caregiver. Permitting MLTSS plans to address smaller issues can be in the best overall interest of the beneficiary and the taxpayer because care disruptions can result in unnecessary or avoidable use of higher-cost services and settings.

 

Not all FWA is intentional.
Self-directed personal care services are another area identified by ACAP-member MLTSS plans that would benefit from more intensive oversight and nuanced approaches for identification and mitigation of FWA. In these programs, the beneficiary acts as a pseudo-employer of their own personal care attendant. Such services can often be delivered by friends or family, which creates a potential conflict of interest. While such programs can often be the best solution for some beneficiaries, they also can be the most challenging programs for oversight.

While self-directed personal care services are vulnerable to FWA, not all FWA is intentional. Limited member education and lack of experience managing personal care workers were identified as significant drivers of unintentional FWA. As a result, ongoing education and re-education of both the members and their self-directed caregiver are core strategies across the ACAP-member MLTSS plans that were interviewed.

FWA in self-directed personal care services can be difficult and resource-intensive to investigate. While common patterns and indicators emerge, individual cases often require detailed review; plans consistently shared that some services that initially appear fraudulent or wasteful may be within scope and completely warranted for the beneficiary.  For example, a personal care assistant may appropriately provide care to a member during a hospitalization when the hospital cannot meet the member’s specific care or safety needs.

Policy Recommendation 3.

States should enable risk-free reporting of suspected FWA. Identifying more FWA requires flagging more suspected FWA. However, reporting suspected FWA can sometimes result in administrative processes that shift the liability or compliance risk for unproven FWA allegations back onto the MLTSS plan.

State Processes

MLTSS plans contract with states to administer services to beneficiaries. Under their agreements with states, plans are obligated to report potential FWA so that a state can investigate and potentially recover any inappropriately paid amounts.

Policy Recommendation 4.

States should establish FWA portals that indicate that status of cases reported MLTSS plans to the state, and the detailed findings of finalized state fraud investigations across all payers.

Some states’ laws and compliance requirements constrain plans’ ability to identify, pursue, or report FWA.  Even when a legitimate concern is identified, plans noted that decisions about reporting or escalation must follow internal plan governance processes, particularly when reporting could create compliance issues, such as when reporting suspected FWA results in the plan not meeting prompt payment requirements. Additionally, in some instances, providers that are flagged by the plan for potential fraud will take legal action against the plan.

Plan respondents noted a gap between suspected fraud and provable fraud. Data analysis can show abnormal billing, but fraud requires proof of intent. Often, suspected fraud that is reported to the state cannot be proven. Moreover, states often lack clear actions to take when the abnormal billing is waste, rather than fraud.

Policy Recommendation 5.

MLTSS plans should be able to hold payments during active fraud investigations or be able to require a change in provider so that beneficiaries do not continue to receive services from a provider that is under investigation for suspected FWA, provided that the level of service is not decreased.

Once suspected FWA is reported to a state, there is high variability around state processes and timelines for addressing the suspected fraud. Plan respondents consistently recommend that states should share the reports of suspected FWA with all the MLTSS plans in the state. While all interviewed plans reported participating in mandatory centralized submission and reporting on FWA, none reported that they received information from the state on identified FWA offenders or pending FWA cases. This creates a blind spot for plans; they could be engaging with a known or suspected fraudulent provider without realizing it. While there may be good reasons to withhold information during an active investigation, MLTSS plans note that states should at least empower plans to mitigate further financial loss or beneficiary harm while the FWA investigation by the state is ongoing.

Another barrier to mitigating FWA occurs when state entities tasked with determining FWA are not well informed about MLTSS services. ACAP-member MLTSS plans recommended that FWA education is needed across the entire MLTSS system—not just within health plans. For example, plans reported that sometimes entities involved in beneficiary appeal processes may have limited understanding of both MLTSS services and FWA. When a plan reassesses a member and determines that a lower level of service is appropriate, the member may appeal that reduction through these processes. Reviewers may overturn clinically supported service reductions and maintain levels of care that are higher than clinically warranted, creating waste when services continue beyond what the plan’s assessment determined was necessary.

ACAP-member MLTSS plans identified FWA recoveries as another area for desired transparency. When plans report suspected fraud to a state, the state may work to recover funds that were identified as fraudulently paid. These funds were often initially paid to the bad actors by the MLTSS plans as part of their capitated payments. While states can take different approaches to how recovered payments are accounted for in plan payments, the details of FWA recoveries can inform actuarially sound rates to MLTSS plans.

Policy Recommendation 6.

State Medicaid programs should have clear processes that indicate how fraud recoveries are factored into rate-setting for MLTSS plans. This includes state assumptions around estimates of existing fraud and recovery goals.

Plan respondents also noted that the complexity of program administration can increase the burden of effectiveness of combatting FWA. For example, third parties are often not aligned with plans in detecting and reporting FWA. Some states utilize third party organizations to conduct independent care management or administer a single aspect of an HCBS program. For example, a state may contract with an independent care management organization to conduct an initial eligibility determination. Another example is when a state’s self-directed services program is overseen not by the MLTSS plan, but by a third party. Often these entities have authority to direct care but are not financially responsible for FWA. When these entities sit between the payer and the state (e.g., they hold data, manage the network, or may be incentivized to increase the level of care), the process for effectively identifying and stopping FWA can be slower and more complex.

Policy Recommendation 7.

States should clearly outline the roles and responsibilities of all players in HCBS programs as they relate to FWA. This should include expectations for monitoring, identifying, investigating, and resolving suspected and actual FWA.

Policy Recommendation 8.

States should identify where potential conflicts of interest may occur in MLTSS programs (e.g., where there may be a financial incentive not to report FWA) and develop documented processes for mitigating those conflicts.

 

Federal Processes

One area that ACAP MLTSS plans discussed was the difference in certifications between clinical caregivers and caregivers delivering personal care services.

Policy Recommendation 9.

The federal government should require that all individual caregivers (not just organizations) in HCBS programs register with state Medicaid agencies. State agencies then should assign each caregiver a unique identifier that is durable across employers. All fee-for-service billing should be attributable to a specific, identified caregiver.

For example, registration of personal caregivers or adult day centers varies significantly across states. Many personal caregivers work with multiple home care agencies. Tracking hours worked by individual caregivers across different organizations is difficult and complicates the identification of potential FWA, such as overbilling. Plan respondents recommended that states certify all HCBS providers and assign each personal care attendant a unique identifier.

 

Policy Recommendation 10.

The Federal government, state Medicaid agencies, and MCOs should develop a process to identify, verify and communicate beneficiary deaths promptly after the date of death.

Another situation that MCOs identified as higher risk for FWA is when a beneficiary dies. Plan respondents noted that sometimes death data is not promptly shared between federal agencies, state agencies, and MLTSS plans. This can result in services, such as food and household goods, being delivered to beneficiaries that the plan believes to be alive but are in fact deceased.

 

 

SUMMARY OF RECOMMENDATIONS 

• State HCBS program requirements should set clear expectations for regular (e.g., semi-annual) in-person assessments of beneficiaries receiving HCBS by a care manager.
• States and the federal government should permit MLTSS plans some discretion in deciding what suspected FWA is referred to the state.
• States should enable risk-free reporting of suspected FWA.
• States should establish FWA portals that indicate that status of cases reported MLTSS plans to the state.
• MLTSS plans should be allowed to withhold payments during active fraud investigations or require a change in provider.
• State Medicaid programs should have clear processes that indicate how fraud recoveries are factored into rate-setting for MLTSS plans.
• States should clearly outline the roles and responsibilities of all players in HCBS programs as they relate to FWA.
• States should identify where potential conflicts of interest may occur in MLTSS programs (e.g., where there may be a financial incentive not to report FWA) and develop documented processes for mitigating those conflicts.
• The federal government should require that all individual caregivers (not just organizations) in HCBS programs register with state Medicaid agencies.
• The Federal government, state Medicaid agencies, and MCOs should develop a process to identify, verify and communicate beneficiary deaths promptly after the date of death.

 

Conclusion

MLTSS programs deliver a different set of services that utilize different providers than traditional medical insurance products. The features of these programs require different approaches to combatting FWA. ACAP’s MLTSS members identified best practices and potential barriers to identifying and addressing FWA in MLTSS services. These recommendations include regular in-person assessments, empowering care managers, giving MCOs tools for FWA mitigation, having transparent state processes, and better tracking individual providers across plans and organizations.

 

Acknowledgements

ACAP gratefully acknowledges the assistance of Adam Zavadil of ZAHealth in the preparation of this document, as well as the participation of senior staff at the following plans who informed its findings:

Lakeland Care
Metropolitan Jewish Health System
Nascentia Care
Neighborhood Health Plan of Rhode Island
UPMC Health Plan