Risky Business: Safeguard your Skilled Nursing Facility

Historically when a Skilled Nursing Facility (SNF) outsourced their therapy to a contract provider, they partly did it to abdicate the headache, responsibility, and liability. Those reasons for outsourcing are no longer valid thanks to recent legal precedent. The following settlements between the Federal Government and SNF providers show that even when a facility contracts with an outside rehabilitation therapy provider, the facility now has a continuing responsibility related to the provider’s actions. This responsibility, if neglected, could cost you millions, so I wanted to take a minute to share a few links to those articles with you and some thoughts I have regarding the overarching issue of managing your therapy program:

Of most importance is the article: Therapy buck stops at SNF - McKnight's Long Term Care News.  In this article, US Attorney Carmen Ortiz states, “When a facility contracts with an outside rehabilitation therapy provider, the facility has a continuing responsibility to ensure that the provider is not engaged in conduct that causes the submission of false claims to Medicare.”  We have always known that as the Medicare billing entity, the facility would be held liable by CMS should any reason for suit or settlement occur. However, a precedent is now being set where the Fed is placing the responsibility of overseeing your therapy contractor (all of your service contractors for that matter) squarely on the facility’s shoulders.  This is in stark contrast to former times when facilities would outsource to contractors and then relinquish worry or responsibility.  As these new judgements show, that old way of doing things could turn costly if the Fed gets involved, as the resulting fines show the facility is now ultimately responsible for the contractor’s actions (known or unknown). 

The therapy sector of the SNF world is so specialized and the regulations are ever-changing. How do you ensure that your contractor is playing by the rules when you and your team may not have a firm grasp or understanding of what the details of those rules actually are? Are you (the SNF) performing chart audits of the patients your contractor is treating?  Are you doing regular operations audits and measuring the metrics, such as RUGs distribution, Part B utilization, LOS, and modes of therapy? These audits should not be something that is left to your contractor to do and then report the results to you; given the conflict of interest, that would be akin to the “fox watching the henhouse” (as my grandfather would say).

If your therapy program is in-house without a contract provider, then I am sure you are already aware that the liability of what your therapists do is your facility’s responsibility. Best practices show that you should be doing the same things identified above - chart and operations audits, which can save you headaches and money in the long run. This oversight can prove challenging as in-house programs typically have less manpower to take on the audit tasks. And just like the SNFs with a contract therapy provider, your therapists should not be the ones policing their own actions as they often have not taken the time to stay up-to-date on how changing Medicare regulations can (and do) impact operations and billing.

The takeaway and my recommendation to all providers is for you to be sure that chart audits and an overall review of your therapy program are part of your ongoing compliance plan. If you have the manpower and expertise to do so, I advise your team to perform the review audits at least biannually, if not quarterly, depending on the structure and size of your therapy program.  

Here at Seagrove Rehab Partners, in response to the DOJ Settlements, we put together a Proactive Audit and Assessment Plan for those SNFs who want assistance with their oversight for either outsourced therapy operations or your own in-house program. This plan includes quarterly support through two on-site Comprehensive Therapy Program (CTP) Assessments and two desk audits throughout the year, as well as weekly access to our help desk for therapy-related questions in between the quarterly assistance. The CTP visits are a comprehensive assessment of your therapy program and operations, typically involving two to three days on-site. The review covers everything your therapy program is doing and gives concrete recommendations going forward, with analysis about what is going on in your facility from a clinical and liability standpoint. The audits include findings in a PowerPoint format with presentation (if desired) as well as recommendations for correction of identified issues.

We welcome the opportunity to partner with you proactively, and wish you and your team all the best as you serve those entrusted to your care.