	Background

The Health Care Financing Administration (HCFA)—an agency of the Department of Health and Human Services—administers the Medicare home health care program. ABC Modified Medical Records to Continue to Provide Services to Patients Who May Be Ineligible

Current and former ABC employees told us that medical records were altered and forged to ensure continued or prolonged home health care visits. We found instances in which ABC’s records appeared to justify home visits, but the patient seemed no longer eligible. This practice was intended to create the appearance that continued home health visits were needed. Another office manager directed a nurse to record visits that were never made. ABC Reportedly Charged Medicare for Costs of Purchasing Home Health Agencies and for Gifts Given to Physicians

ABC reportedly charged Medicare for questionable costs when ABC included expenses associated with the purchase of other HHAs in its cost reports. Former owners who had sold their HHAs to ABC maintain that ABC masked the total price of purchasing their HHAs by paying HHA owners a small sum up front and the balance in the form of salary under employment agreements over a number of years. ABC Reportedly Charged Nonallowable Marketing Expenses to Medicare

According to former employees, ABC directed them to market its services to physicians and the community with the intent of charging Medicare for these nonallowable expenditures. It addressed issues involving ABC’s participation in the Medicare home health care program.
Why GAO Did This Study

Pursuant to a congressional request, GAO investigated specific allegations regarding a home health care firm's participation in the Medicare home health care program, focusing on whether its employees: (1) altered or forged medical records to ensure continued home visits; (2) made more visits to patients than necessary; and (3) charged Medicare for costs unrelated to patient care.

What GAO Found

GAO found that: (1) some local office managers directed current and former employees to alter patient records so that it appeared that the patients continued to need home health visits, and to continue visiting patients that no longer qualified for Medicare home health care; (2) the firm charged Medicare for the cost of acquiring other home health agencies by paying home health owners a small sum up front, and paying the balance as a salary under employment agreements; and (3) some managers directed their employees to market the home health care firm and its services with the intent of charging Medicare for these unallowable costs.