Posthospital Skilled Nursing Facility Care Provided to Dually Eligible Beneficiaries in Indiana Generally Met Medicare Level-of-Care Requirements

Why OIG Did This Audit

To qualify for skilled nursing facility (SNF) services, a Medicare beneficiary must have a preceding inpatient hospital stay. Centers for Medicare & Medicaid Services (CMS) research has found that many hospital admissions of nursing home residents who are enrolled in both Medicare and Medicaid (dually eligible beneficiaries) could have been avoided because the condition could have been prevented or treated outside of an inpatient hospital setting.

Our objectives were to determine whether the posthospital SNF care provided to dually eligible beneficiaries in Indiana between October 1, 2016, and September 30, 2018 (our audit period): (1) was associated with potentially avoidable hospitalizations and (2) met Medicare level-of-care requirements.

How OIG Did This Audit

Our audit covered 20,668 SNF claims with Medicare payments totaling $119,945,529, where each payment was greater than or equal to $350 for services provided during our audit period, to dually eligible beneficiaries in Indiana who had a preceding Medicaid-covered stay at the same nursing facility. We selected and reviewed a stratified random sample of 100 SNF claims totaling $667,184.

What OIG Found

Posthospital SNF care provided to 98 of the 100 dually eligible beneficiaries in Indiana, on whose behalf the sampled SNF claims were submitted, was not associated with potentially avoidable hospitalizations. For the remaining two beneficiaries, our independent medical review contractor found that the beneficiaries' conditions were potentially preventable and manageable at the NFs, but, because the NFs did not have effective prevention strategies, the beneficiaries were hospitalized and later discharged to SNF care at the same facility.

Posthospital SNF care provided to 98 of the 100 beneficiaries met the Medicare SNF level-of-care requirements. The remaining two beneficiaries did not meet the Medicare SNF level-of-care requirements because the SNF physicians incorrectly determined that the beneficiaries required skilled nursing or skilled rehabilitation services, or both, on a daily basis.

For all 100 beneficiaries, physicians ordered SNF services. We noted that records from the hospitals where 33 beneficiaries had a qualifying inpatient stay did not contain a clear and definitive hospital physician discharge order for SNF care. Hospital physicians mainly discharged beneficiaries "back to nursing facility" without specifying the level of care. In these cases, SNF physicians certified the SNF level of care. The physician order not only affects level-of-care determination but also has a financial impact on the nursing facilities.

What OIG Recommends

Our independent medical review contractor found that SNF care provided to dually eligible beneficiaries in Indiana during our audit period generally: (1) was not associated with potentially avoidable hospitalizations and (2) met the Medicare level-of-care requirements. As a result, we do not have any recommendations. However, the quality of care in nursing facilities remains a concern for OIG. OIG will continue to monitor SNF claims, including those submitted on behalf of dually eligible beneficiaries, to determine whether services are appropriate and meet payment requirements.