The Medicaid program is a state and federal government program which pays for certain health services and nursing home care for older people with low incomes and limited assets. In most states, Medicaid also pays for some long-term care services at home and in the community. Who is eligible and what services are covered vary from state to state. Most often, eligibility is based on income and personal resources.
Although Medicare does not pay for long term care as such, residents of long term care facilities are eligible for Medicare benefits when in need of acute, skilled medical services provided by physicians, nurses and hospitals. If a Medicaid resident requires hospital treatment for example, Medicare will pay for up to 100 days of skilled rehabilitative services in a nursing home. Such care is provided through Long Term Acute Care Hospitals (“LTACH”) which are paid in advance by Medicare.
The most basic requirement for reimbursement eligibility under Medicare and Medicaid is that the service provided must be reasonable and medically necessary. See, e.g., 42 U.S.C. § 1395y(a)(1)(A); 42 U.S.C. § 1396, et seq.; 42 C.F.R. § 410.50. Medical providers are not permitted to bill the government for medically unnecessary services or procedures performed solely for the profit of the provider. Other requirements include periods of time, imposing limits and thresholds for treatment. Consequently, fraud in this area often includes the provision of medically unnecessary services, kickbacks for referrals and the manipulation of the length of home stays and readmission dates.
The following case (not one of ours) is illustrative: in 2011, Select Medical Corporation which operates 100 LTACH’s paid $7.5 million to settle whistleblower allegations of unlawful payments for referrals. As part of the settlement, Select Specialty Hospital System entered into a Corporate Integrity Agreement that mandates strict reporting and monitoring requirements.