OIG Reminds CMS, again, of Requirements to Implement Intermediate Sanctions for Home Health Agencies

On March 2, 2012, the DHHS OIG’s office of Evaluations and Inspections (“OEI”) released an early alert memorandum report related to its ongoing study of Survey and Certification of Home Health Agencies (OEI-06-11-00400).  In its memorandum, the OIG urges CMS to make Home Health Agency (“HHA”) intermediate sanctions a high priority and complete their implementation as soon as possible.

As background, CMS’ survey and enforcement authority for HHAs currently only includes the significant sanction of termination of a provider agreement, which rarely occurs according to the OIG.  Intermediate sanctions are designed to provide additional enforcement tools and penalties in order to encourage and assure provider compliance.  Intermediate sanctions are levied as alternatives to termination of the provider agreement.

The implementation of intermediate sanctions for noncompliant HHAs was directed by the Omnibus Budget Reconciliation Act of 1987 and was recommended in an August 2008 OIG report.  The intermediate sanctions CMS was to implement were supposed to include civil money penalties, payment suspension, and appointment of temporary management.

It is unclear what effect OIG’s prodding of CMS to implement intermediate sanctions will have in terms of how quickly intermediate sanctions will be implemented.  It has been 20 years since the statutory provisions were enacted and HHAs have yet to see implementation. However, it is quite clear that the OIG would like to see this issue front and center. HHAs should be on the look out for new activity at CMS related to implementation of the statutory requirements.  The OIG advises that CMS has stated that a draft proposed rule containing alternative sanctions would be sent for clearance within CMS and that it anticipated publishing a new Notice of Proposed Rule Making by September 2012.

You can get a copy of the OIG report here —> OIG Early Alert Memorandum

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