OIG’s 2014 Work Plan efforts that will focus on Nursing Homes

The U.S. Department of Health and Human Services, Office of Inspector General (“OIG”) recently released its Work Plan for Fiscal Year (FY) 2014 which summarizes the reviews and activities that the OIG plans to pursue during FY 2014.  These reviews and activities relate to areas the OIG has identified as most in need of attention.  Some of these activities are new and some are ongoing from past years.   The Work Plan covers various categories of programs.  For nursing homes, which is the concentration of this article, most of the focus areas are in relation to the Medicare program, as discussed below, but important Medicaid and state survey issues are also under review. 


A new focus area for 2014 is Medicare Part A billing by skilled nursing facilities (“SNFs”).  The OIG added this focus area based on the OIG’s belief that SNFs increasingly billed for the highest level of therapy even though the beneficiaries’ characteristics remained mostly unchanged.  In addition, the OIG contends SNFs billed one- quarter of all 2009 claims in error, which allegedly caused $1.5 billion in inappropriate Medicare payments.  As a consequence, in 2014 the OIG will review SNF billing practices in selected years  and describe how SNFs billing practices have varied between those years. 

The Medicare focus areas that are not new in 2014, but will continue from past years include:

(1)   Questionable billing patterns for Part B services during nursing home stays.  The OIG will conduct a series of studies to examine several broad categories of services, such as foot care, provided to nursing home residents during stays not paid under Part A.  The OIG is continuing to focus on this area under the explicit direction of Congress to monitor Part B billing for abuse during non-Part A stays.

(2)   State agency verification of deficiency corrections.  The OIG will seek to determine whether State survey agencies verified correction plans for deficiencies identified during nursing home recertification surveys.

(3)   Program for national background checks for long-term-care employees.  The OIG will review the procedures implemented by participating States for long-term-care facilities to conduct background checks on prospective employees and providers who would have direct access to patients.  The review is also supposed to assess the costs of conducting background checks.  The Affordable Care Act mandated this review and the OIG is expected to issue a summary of its findings in FY 2017.

(4)   Hospitalizations of nursing home residents for manageable and preventable conditions.  The OIG will attempt to determine the extent to which Medicare beneficiaries residing in nursing homes are hospitalized as a result of conditions thought to be manageable or preventable in the nursing home.  The OIG views hospitalizations of nursing home residents as a preventable cost to Medicare and an indication of quality-of-care problems on the part of the nursing home.


Some assisted living facilities provide services to home and community based (HCBS) waiver recipients.  Although Medicaid covers the cost of HCBS, it does not cover room and board costs.  The OIG will continue to focus on room and board costs associated with HCBS waiver program payments to determine whether selected states claimed Federal reimbursement for unallowable room and board costs associated with services provided under the HCBS waiver programs. 

Many states, Indiana included, impose state health-care related taxes on Medicaid nursing home providers to finance a portion of the state’s Medicaid spending.   The OIG will continue to focus on and review these taxes imposed on Medicaid providers to determine whether the taxes comply with applicable Federal requirements. 

By reviewing the focus areas identified in the Work Plan, providers can determine where to focus their compliance program efforts.  If you have any questions regarding the Work Plan and nursing homes please contact Randall Fearnow at rfearnow@kdlegal.com or Meghan McNab at mmcnab@kdlegal.com.