This is an archive page. The links are no longer being updated.
FOR IMMEDIATE RELEASE September 29, 1998 Contact: HCFA Press Office (202) 690-6145
The Department of Health and Human Services today announced new actions to ensure that Medicare beneficiaries with acute mental illness get quality treatment in community mental health centers and that Medicare pays appropriately for those services.
As part of a comprehensive action plan, HHS' Health Care Financing Administration will initiate termination actions against centers that appear unable to provide Medicare's legally required core services, and will require others to come quickly into compliance. The agency also will demand repayment of money paid inappropriately for non-covered services or ineligible beneficiaries.
Termination actions will be phased in over a period of months in order to address the most egregious providers first and to assure that beneficiaries needing psychiatric services will continue to receive them in an appropriate setting. Twenty non-compliance notices will be issued this week, with an estimated 80 notices in all to be sent by early 1999.
"This is an important benefit for Medicare beneficiaries who need outpatient psychiatric services. We need to move in a deliberate, targeted manner to assure that beneficiaries' needs are met, and at the same time, that fraud and abuse in this program is eliminated," HHS Secretary Donna E. Shalala said.
"There is clear evidence of abuse of this program," Shalala added. "Working together, HCFA and the HHS Inspector General have found extensive evidence of providers who are not qualified, patients who are ineligible, and services billed to Medicare that are not appropriate. HCFA's 10-point plan is designed to correct these problems, and to ensure that senior citizens receive the Medicare services that they need." Under a 1990 law, community mental health centers are allowed to provide "partial hospitalization" services to beneficiaries with acute mental illness who otherwise might need to be hospitalized. These intensive psychiatric services can also be provided by outpatient psychiatric programs in hospitals.
To participate in Medicare, however, the law requires community mental health centers to provide four core services: 1) outpatient services to the elderly, children and the severely mentally ill; 2) 24-hour-a-day emergency care; 3) day treatment or other partial hospitalization services; and 4) screenings to determine whether to admit patients to state mental health facilities.
Working with the HHS Inspector General in the Operation Restore Trust anti-fraud initiative, HCFA last year identified patterns of fraud and abuse of the benefit at community mental health centers. Centers investigated were found to be billing Medicare for services that weren't covered, weren't provided, or weren't needed. Some beneficiaries who did not need the benefit did not even know that they were in a program intended for people with mental illness.
In response, HCFA this year conducted site visits to about 700 Medicare-participating centers and applicants. Many met few, if any, of the statutory requirements for Medicare participation, raising doubts about their ability to care properly for beneficiaries. Medicare is now moving to terminate the most egregious violators.
"Partial hospitalization is intended for those who need psychiatric services," said HCFA Administrator Nancy-Ann DeParle. "But in my own inspection of some of these programs, it was clear that some centers are using this program, and billing Medicare, in ways that are completely inappropriate. Centers must be competent to provide the services that are needed, and they must stop enrolling beneficiaries who do not need these benefits."
In January, President Clinton asked Congress to enact legislation that would authorize fines for physicians who falsely certify a beneficiary's eligibility for partial hospitalization services and would allow the Secretary to create additional requirements for community mental health centers to participate in Medicare. That legislation is still pending before Congress.
Today's actions build on the Administration's existing efforts to end the waste, fraud and abuse of the partial hospitalization benefit. HHS' Operation Restore Trust targeted four areas for special review -- home health, durable medical equipment, long-term care and community mental health centers.
A 10-point plan announced today includes the following leading elements:
The number of community mental health centers has grown rapidly since Congress first allowed the centers to serve Medicare beneficiaries. There are about 1,150 community mental health centers participating in the Medicare program today. About 1,000 hospitals also provide the partial hospitalization benefit.
Between 1993 and 1996, total Medicare payments to these centers rose sharply -- from $60 million to $265 million, a 342 percent increase. The average payment per beneficiary during this period rose from $1,642 to $6,874, a 319 percent rise. Preliminary figures for 1997 show total payments climbing to $349 million and average payment per beneficiary topping $10,000.
"Today community mental health centers account for only a small fraction of Medicare's overall budget -- but it's still crucial that every dollar goes to legitimate services," DeParle said. "By acting now, we will protect beneficiaries, taxpayers and the trust fund from growing abuse."
Prior to today's announcement, HCFA and the Inspector General have worked together to correct problems with these centers identified by last year's Operation Restore Trust efforts:
Two separate IG reports on the partial hospitalization benefit are expected to be released soon.
The Clinton Administration has made stopping waste, fraud and abuse in the Medicare program one of its top priorities. In fiscal 1997, Medicare saved more than $7.5 billion through its anti-fraud and abuse efforts, and, with its law enforcement partners, returned another $1 billion to the Medicare Trust Fund.
Note: HHS press releases are available on the World Wide Web at: www.hhs.gov.