Focus on Skilled Nursing and the 2012 OIG Work Plan

skilled nursing 2012 oig work plan

On October 5, 2011, the Office of the Inspector General (OIG) published it’s long anticipated (drum roll please) … OIG 2012 Work Plan.  For those of you who are not familiar with this annual document, it outlines the compliance risk areas that subject both Medicare and Medicaid providers (including skilled nursing providers) to audit and enforcement actions.  As such, it is a valuable read as it can offer skilled nursing providers essential guidance on issues which will affect their operating practices.

Now, I’m guessing that most of you aren’t going to take the time to carefully sift through all 165 pages of this scintillating publication.  (Not exactly light reading.)  But, if you would like an excellent overview of the 2012 OIG work plan, I would strongly recommend that you read Tom Lee’s blog entitled OIG Work Plan Update-What’s new for 2012?.  It’s important to note that the work plan contains several critical provisions that pertain specifically to nursing home providers.


Skilled Nursing and the 2012 OIG Work Plan … what to know and what to do

The OIG has specified eight “projects” that specifically target skilled nursing facilities and three of these projects are new this year:

  • Nursing home compliance plans

This one is a biggie.  The OIG intends on reviewing Medicare and Medicaid certified nursing homes to ensure that they have implemented compliance plans as a part of their daily operations.  The intent is to verify that the compliance plan contains the key elements as identified in the OIG’s compliance program guidance.  The Affordable Care Act of 2010 requires that CMS issue regulations by 2012 and that nursing home providers must have a compliance program in place by 2013.  This program must contain eight key elements:

  1. Designation of a compliance officer and compliance committee
  2. Development of compliance policies and procedures including standards of conduct
  3. Developing open lines of communication
  4. Appropriate training and teaching
  5. Internal monitoring and auditing
  6. Response to detected deficiencies
  7. Enforcement of disciplinary standards
  8. Periodic risk assessment of the compliance program systems and structures
  • What should you do to address the 2012 OIG work plan? It should go without saying (but I’m going to say anyway), that if you don’t have a formal, written compliance plan in place, put one together right now!  First, make sure it addresses all eight key elements.  Second, make sure it’s a part of your daily operations by involving operations people in the system.  Lastly, the plan must be dynamic and active so do an annual assessment of your compliance program and make sure you make the necessary changes in the program as a result of your assessment.

  • Questionable billing patterns during non-Part A nursing home stays

The OIG will identify, through a series of studies, questionable billing patterns for nursing home and Medicare providers, associated with the billing of Part B services for residents whose stays were not paid for under the Medicare Part A program.  The studies will focus on ambulance, imaging, laboratory and podiatry services.  By the way, Congress has directed the OIG to examine these areas for evidence of possible abuse by providers and thus, its inclusion in the 2012 OIG work plan.

  • What should you do to address the 2012 OIG work plan?  Part B services incurred during a non-Part A stay must be billed directly by a supplier or other provider.  Establish a regular audit process to insure that inappropriate billing of Part B services is not occurring.
  • Safety and quality for post-acute care for Medicare beneficiaries

The OIG will examine the transfer process from acute care hospital to post acute care settings for Medicare beneficiaries.  OIG will also endeavor to examine the overall transfer process.  There are three post acute care providers specifically identified-skilled nursing facilities, inpatient rehabilitation facilities and long-term care hospitals.  This process will look to identify rates of adverse events and preventable re-admissions to hospitals.

  • What should you do to address the 2012 OIG work plan?  OIG has seen average lengths of stay at acute hospitals drop and the acuity level at SNF’s rise.  They will be looking to identify SNF’s that are unable to provide the appropriate level of care to admitted patients.  Make sure that your quality assurance program actively monitors patient care and acuity and adjusts your admission criteria to comply with regulations.

And let’s not forget Hospice and the 2012 OIG Work Plan …

In addition to the three new skilled nursing related projects, there is one project that is classified as new for hospice but also directly involves SNF’s:

  • Hospice marketing practices and financial relationships with nursing facilities

The OIG intends on reviewing hospice marketing materials as well as practices and financial relationships with nursing facilities.  In particular, they will look to identify particular instances where hospices and nursing facilities are involved in inappropriate enrollment and compensation under the Medicare program.

  • What should you do to address the 2012 OIG work plan?  A recent OIG report found that a staggering 82% of hospice claims for beneficiaries in skilled nursing facilities did not meet Medicare coverage requirements.  Not surprising they’ve included this in the 2012 OIG work plan after that kind of result.  OIG will be looking at hospices that have a “high percentage” of their beneficiaries in nursing facilities.  Make sure that your hospice arrangements and coverages are appropriate.  With the OIG looking at hospices, why risk getting involved in the investigation?


The OIG work plan gives nursing home operators the ability to be proactive

The Office of the Inspector General’s annual work plan has created a series of efforts that have recouped billions of dollars in repayments, interest, and penalties from healthcare providers … skilled nursing operators included.  As a matter of fact, for every dollar spent on this enforcement effort, the feds realize a 1,670% return.  If this tells us anything, it tells us that the federal government will continue this effort, and will do so in serious fashion.  And that’s understandable.  After all, it’s our own tax dollars that are being protected.

That said, we in the long-term care industry have been made privy to the focus of these audits in advance.  This provides us with the opportunity to self audit our operations in each of the areas addressed in the OIG Work Plan.  And honestly … what more can we ask for?

Well, that’s it for my brief review of the 2012 OIG work plan as it relates to skilled nursing.  That wasn’t so bad now was it?

When you need proven expertise and performance

Craig Fukushima, NHA, MBA

Mr. Craig T. Fukushima’s health care experience spans more than 35 years with special expertise in the long term care sector, including implementation of innovative health care projects in domestic and international locations.