Healthcare monopolies and referral abuse in the nursing home industry

1. Monopolies in nursing homes are limiting access to financially unaffiliated physicians:

-At least two nursing home chains in the country are now employing their own physician groups, under a separate LLC of course, and are referring all their nursing home admissions exclusively to their own employed physicians, excluding competing providers even when those providers have more training and experience in geriatrics than the employed physicians. Independent providers stand no chance competing in facilities with such monopolistic business practices were patients are not offered a choice. Genesis healthcare in the east coast has been at the forefront of this new model in their nursing homes.

Why should CMS be held accountable for this abuse?

CMS is failing to ensure patient choice of providers, as it does not mandate that facilities with conflict of interest have a process to offer choice, declare potential and actual conflicts of interests, and document that patients were indeed offered a choice. Allowing this exclusive referral practice to continue unabated violates CMS's rule that medicare and medicaid patients should be offered a choice when it comes to healthcare services.

2. Emerging Hospital/nursing home exclusive relationships:

-There is a trend in the nursing home industry where hospitals affiliate, one way or another, with nursing homes and rehab facilities, then patient referrals are preferentially steered, in both directions. In extreme cases, nursing homes or rehab facilities are actually owned by the hospital and are receiving referrals preferentially, and sometimes exclusively, impacting, and sometimes limiting, patients' choice to go to other facilities. There are many examples of this in Maine, and I dare assume that Maine is not alone.

Why should CMS be held accountable for this abuse?

. In this case CMS is failing to hold both the hospitals and nursing homes to existing CMS standards mandating that Medicare and medicaid patients should be given a choice of facility upon discharge from the hospital. CMS is willfully ignoring the lack of choice, and in doing so, is encouraging healthcare monopolies that eliminate competition and encourage the formation of competing monopolies in the same service areas, as the only way for competing healthcare businesses to survive the lack of free market competition.

Needless to say, such monopolies are a result of CMS's failure to enforce long standing rules regarding the protection of patient choice, focusing instead on clear cut black and white billing fraud cases that make headlines, but cost the system far less than the above mentioned systematic abuse practices.

3. Nursing homes referral as a form of kickback to consultants:

Nursing home facilities in some parts of the country are courting consultants (to get their patient referrals) by committing to making mass referrals to the consultants . For example, some facilities reward referrals from wound specialist by referring all patients with wounds to the wound consultant, even in cases where the attending physicians have expertise in the field or when wounds are minimal or healing. I actually have a case example where the referral was made to the wound specialist even though the wound was actually healed. That referral was made because the patient had wound listed on their admission diagnosis which triggered an automatic referral.
Ironically, such complete delegation of all wounds to outside consultants has not been proven to reduce wounds and does tend to diminish the nursing staff's knowledge of caring for such patients, which ultimately has the potential of patients receiving inferior wound care. Another way wound referrals are abused is when nursing homes are referring to a hospital owned wound cent in return for the hospital referring patients to the nursing home, this is often made practical by the hospital placing their own physicians as medical directors of the particular nursing home.

Another example of inappropriate referrals is when facilities institute policies to refer all patients on psychotropic medications to the psychiatry service, even if stable or the attending physician is comfortable managing their issues. Clinically, many of the dementia related psychiatry referrals are better managed by geriatric medicine, especially if the attending is trained in geriatric medicine.

Why should CMS be held accountable for this abuse?

. In this case CMS is failing to recognize and target wide spread referral abuse, where the only currency being exchanged is the patients themselves, in the form of referrals.

. CMS fails to develop and implement procedures and methods to identify referral abuse issues in which facilities, and not physicians, are driving referrals as a form of kickback for referrals backs to the facility, which can only be achieved through limiting patients' choice.

. The CMS survey process does not include training surveyors on potential referral abuse issues, and even if surveyors identify potential abuse they would not be able to include such findings in the survey report, as system abuse is not an elements of the CMS survey process. This should come as a shock to many concerned citizens.

. CMS has a policy of combating fraud and abuse, but it only deals with fraud, and is willfully neglecting abuse occurring in plain sight. There is no excuse for this indifference as CMS already has surveyors in every medical facility in the country at least once a year. Logic dictates that wide spread abuse costs the system much more than the sporadic fraud cases that occupy 100% of the fraud and abuse unit's attention. CMS's indifference towards abuse issues that don't rise to the level of outright fraud, is inexcusable.

The problem with CMS regulation on hospice in nursing homes

CMS Hospice related rules and documentation requirements in nursing homes:

Hospice rules currently require that re-certification for hospice services be done ONLY by "hospice employed" providers, excluding the primary physicians from the decision making process. The same rules also stipulate that primary physicians can not discontinue hospice if they feel that it is no longer indicated. Both provisions are shocking but true.

To illustrate what this means in practice, we can look at a case example of Hospice referral in a nursing home below:
. I write a physician order to refer a patient to hospice (as the primary provider), based on a qualifying diagnosis and an estimated life expectancy of less than 6 months.
. The Hospice team would then come in to the nursing home and evaluate the case to determine if it meets criteria for hospice.
. Once qualified, the patient is certified as hospice appropriate, and hospice service is initiated, this is called "initial certification". Medicare part-A is then billed for the service based on a daily rate for 180 days until the next certification time.
. The hospice team is required to re-establish qualification for hospice after 180 days and then every 60 days, by having their own hospice employed physician or NP (physician extender) re-certify patients as hospice appropriate. This step was supposedly designed to limit hospice fraud and abuse; I'm not sure how!
The other twist here is that the primary physicians, who are also required by CMS to do regular visits on regular intervals on all nursing home patients (hospice or not), are now being bypassed, as they now have no say in this hospice re-certification process of their own patients. The primary attendings are also not allowed to discontinue hospice, even if their patients stabilize and no longer qualify for hospice; that privilege is reserved exclusively for, presumably unbiased, "hospice employed" physicians and NPs, unless the patients themselves decline the hospice benefit.
In cases were patients no longer meet criteria for hospice, Hospices often keep patients on the service until the next due date for re-certification, adding weeks and months of unnecessary hospice billing to medicare part-A, even if in the interim, the primary attending physician is documenting that the patient is no longer meeting hospice criteria; Astonishingly, they are not breaking any rules when they do do.

Suggestion to CMS on hospice rules:

-Remove the paperwork burden of additional hospice certifications by using the already mandated visits by patient's own providers for recertification of hospice in nursing homes and ask that the patients own providers document the continued need for hospice, or lack thereof. The hospice team could then match the doctors recommendations to existing hospice criteria to confirm continued eligibility.
This would decrease fraud and abuse by empowering the, more independent providers, to make the call on hospice, and reaffirms the role of primary attending in medical decision making.

Additional related suggestions to CMS related to better cost savings on hospice:

If CMS is interested in limiting cost related to hospice care they should consider the following (in addition to above):
- stop the direct referral by facilities to hospice without first consulting with providers. In this case providers rubber stamp the referrals after the fact. This is especially problematic when it comes to nursing home chains who also owns their own hospice service.
- stop the unnecessary transfers of hospice patients from skilled or NF to acute hospices, as hospice is supposed to be provided regardless of where the patient resides, and such transfers are often removing patients away from a stable environment that they call home, with significant added cost to the system. This is an emerging trend where hospitals, acute hospices, and nursing homes affiliate, directly or indirectly, and share medical directors that sign of on such transfers of patients to the higher cost entity.

- Improve patient choice of hospices in facilities where there is a financial disincentive, through co-ownership, to refer to their main competing hospices (currently the token choice provided often doesn't include the major competitors).