Alternative Sanctions Proposed for Home Health Agencies

CMS has proposed alternative sanctions for home health agencies in the 2013 proposed rule as a result of reprimands from the Office of Inspector General (OIG).

Section 4023 of OBRA 1987 directed CMS to develop and implement intermediate sanctions to apply to home health agencies found to be out of compliance with the Medicare conditions of participation by no later than April 1, 1989. Although CMS issued an intermediate sanction proposed rule in 1991, the notice was withdrawn in 2000.

According to CMS, these sanctions establish alternative penalties to termination that ensure prompt compliance by home health agencies. At this time termination is the only penalty available for failure to comply with the home health conditions of participation. CMS has now proposed the following alternative sanctions:

• Temporary management of the agency
• Suspension of payment
• Civil money penalties
• Directed plan of correction
• Directed in-service training

While under sanctions, agencies could be given up to 6 months to implement plans of correction and come into compliance with regulatory requirements. CMS plans to impose one or more sanctions for each deficiency or for all deficiencies. According to the proposed rule, imposition of sanctions will require prior written notice to the provider and appeal rights.

Sanctions will be based on the extent to which the deficiencies pose immediate jeopardy; the nature, incidence, manner, degree and duration of the deficiency; the presence of repeat deficiencies and compliance history; the extent to which the deficiencies are related to failure to provide quality care and the extent to which the agency is part of a larger organization with performance problems.

In cases where deficiencies pose immediate jeopardy to patient safety, CMS will terminate an agency's provider agreement no later than 23 days from the last day of the survey, unless immediate jeopardy is removed. CMS may also impose sanctions in cases of immediate jeopardy. In non-jeopardy cases, agencies that are noncompliant with conditions of participation and repeat noncompliance with condition and standard-level deficiencies may also be subject to termination and imposition of sanctions.

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