Review of Costs Claimed by MedCare Home Health Services, Inc.

EXECUTIVE SUMMARY:

This final report estimates that MedCare Home Health Services, Inc. was overpaid Medicare funds totaling at least $2.2 million in Fiscal Year 1996 for services that did not meet Medicare reimbursement requirements. A statistical sample of 100 claims disclosed unallowable payments for: (1) 484 services included in 30 claims that were provided to beneficiaries who were not homebound; (2) 257 services included in 13 claims that were not reasonable or necessary in the opinion of medical personnel; and (3) 18 services included in 1 claim for home health aide services provided to a beneficiary who had contracted with a private agency to receive similar type services, therefore, the aide services were unnecessary. We recommended that the Health Care Financing Administration (HCFA) instruct the Fiscal Intermediary (FI) to recover overpayments of $2.2 million, and require the FI to instruct MedCare on its responsibilities to properly monitor subcontractors for compliance with Medicare regulations. The HCFA concurred with our recommendations.