Hospice Industry Seeks Solutions to Issues in OIG Reports

Debate continues about how the hospice industry, as well as regulators, should respond to the reports on hospice care issued in July by the U.S. Department of Health and Human Services Office of the Inspector General (OIG) that included recommendations to the U.S. Centers for Medicare & Medicaid Services (CMS) on changing their processes for evaluating compliance.

The first OIG report indicated that about 20% of hospices surveyed by regulators or accreditors between 2012 and 2016 had a condition-level deficiency that posed a serious safety risk. A second report discussed 12 examples of those deficiencies in-depth. OIG examined state agency and accreditor survey findings as well as complaint data from 2012 through 2016. Regulators and accreditors surveyed nearly all hospice providers in the nation during those years.

“These cases reveal vulnerabilities in CMS’s efforts to prevent and address harm that have implications for the wider hospice population,” OIG reported. “These vulnerabilities include insufficient reporting requirements for hospices, limited reporting requirements for surveyors, and barriers that beneficiaries and caregivers face in making complaints. Also, these hospices did not face serious consequences for the harm described in this report.”


Though the OIG reports did identify some egregious examples of safety violations in hospices, the severity of regulatory deficiencies in general varies widely, ranging from instances that pose an immediate threat to a patient’s life and safety to relatively low-risk considerations such as clerical errors in patient documentation or a hand hygiene dispenser protruding an extra inch into the hallway of an inpatient facility.

“Like a lot of things in life, it’s important to understand the context beneath [the reports]. There are some observations inside of it that will allow the industry and trade associations to begin a dialogue,” Nick Westfall, CEO of VITAS Healthcare, a subsidiary of Chemed Corp. (NYSE: CHE), said at the Home Health Care News Summit conference in September. “We can all agree that quality and transparency is absolutely a positive thing, but understanding the mechanics of it is an important component. The biggest fear is that when you start producing some of those reports without context for it, it may dissuade the exact thing that the country is trying to do and that ironically the government is trying to do, which is figure out how we get more people in to hospice and into hospice earlier.”  

When it comes to concerns about hospice billing practices, the waters become even more murky.


Documentation errors and omissions, live discharges and lengths of stay beyond six months are three red flags that could cause regulators to come knocking at a hospice’s door. However, though instances of fraud do exist, issues related to length of stay or live discharges often result from the ways the hospice patient population has changed since the Medicare Hospice Benefit was established in 1983. 

The benefit, with its requirement of a six-month terminal prognosis, was originally designed to serve cancer patients, who have a more predictable disease trajectory than the patients with dementia and cardiac conditions that hospices care for today. Patients with these conditions are the most likely to see lengths of stay that exceed six months.

“Scrutiny over lengths of stay are a product of the six-month requirement. Whether care is related or unrelated [to a patient’s terminal prognosis] or whether care is too long or too short is a product of the fact that hospice is a six-month prognosis benefit, and that patients can’t get concurrent care,” Edo Banach, president and CEO of the National Hospice & Palliative Care Organization said. “I think that should be changed, which would free providers and those who oversee them to actually look at the quality of care being provided. They are looking at the wrong thing.”

The National Association for Home Care & Hospice (NAHC) recently made recommendations to CMS and other stakeholders to address the issues described in the OIG reports, including requiring CMS to publish a list of top deficiencies annually with a plan of action for addressing them.

NAHC recommended increasing the frequency of surveys for hospices that have a history of serious deficiencies, including unannounced spot checks, making state agency and accreditation organization reports publicly available, and additional action to improve CMS’ process for capturing and responding to patient complaints and to strengthen the effectiveness of the survey process.

The organization called for CMS to evaluate the consistency of state agency surveyor and accreditation organization surveyor actions that pertain to Medicare Conditions of Participation, as well as CMS regional office interpretations and applications. They also advocated or annual audits to ensue survey accuracy.

“The OIG’s findings have made a valuable contribution to the knowledge base surrounding hospice quality of care. These include insights into the need for better education regarding commonly cited areas of deficiency as well as improved focus and appropriate corrective action toward providers that perform poorly as evidenced by a history of serious deficiencies and/or substantiated complaints,” NAHC indicated in a statement. “The OIG reports have also fostered discussion within the hospice industry around the need to eliminate inconsistencies in the survey process and flawed policy interpretations that create confusion.”

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