Nursing Homes and Skilled Therapy
Background
Medicare and Nursing Homes: What Is and Isn’t Covered
Medicare does not cover all nursing care. It will cover skilled rehabilitation but not long-term nursing care. If a Medicare beneficiary has a “qualifying” inpatient hospital stay of at least three nights, then Medicare will cover up to 100 days of skilled rehabilitation afterward. For example, if a Medicare patient breaks a bone or has a stroke and then needs skilled rehab in order to walk and care for herself again, then Medicare will pay for necessary post-hospital rehab treatment for up to 100 days. In contrast, long-term nursing care (i.e., residential care provided to an individual who is no longer capable of living independently) is not covered by Medicare—though state Medicaid programs often cover it.
Medicare reimburses skilled nursing facilities on a “per diem” basis—i.e., paying a set amount for each day the beneficiary is at the facility. The formula to calculate the per diem rate for a particular beneficiary is complicated, but the short version is that a patient who is in worse health and is projected to need higher levels of therapy and nursing care will be reimbursed at a higher per diem rate than healthier patients needing lower levels of care. This reimbursement model often results in the submission of false claims, as providers find it all too tempting to manipulate records in order to maximize profits. Barrett Johnston Martin & Garrison, PLLC, has filed numerous FCA cases involving iterations of these schemes by skilled nursing providers, including a case against a southeastern nursing home chain that resulted in a $30 million settlement.Common FCA Schemes for Nursing Homes and Skilled Therapy
Common FCA schemes in the skilled nursing and rehab therapy context include:
- Manipulating patient assessments to make patients appear sicker than they actually are in order to qualify for a higher per diem rate.
- Keeping patients at the facility longer than medically necessary to use up as many of the 100 covered days as possible. One variation on this scheme—which typically requires a doctor at a hospital who is willing to play along—is to refer patients out for unnecessary hospital stays in order to restart the clock on the 100 covered days.
- Paying kickbacks in order to induce the referral of patients.
- Engaging in kickback schemes with pharmacies and drug manufacturers to induce business or give preferential treatment to certain pharmacies or medications.
- Providing unnecessary skilled therapy under Medicare Part B to long-term care residents just to bill for it.
Medicare payments to skilled nursing facilities have increased significantly in recent years, and analysts expect Medicare spending in this sector to top $30 billion per year in the near future. Barrett Johnston Martin & Garrison, PLLC, has been at the forefront of False Claims Act litigation aimed at recouping money on behalf of both states and the federal government lost due to unscrupulous nursing facilities and companies.