Clinton sets health care moratorium Home services market for elderly is targeted

September 16, 1997|By LOS ANGELES TIMES

WASHINGTON -- President Clinton announced a crackdown on Medicare fraud yesterday, targeting the burgeoning home health care market that accounts for a rapidly growing share of federal spending on the elderly.

Under the president's plan, Medicare will stop signing up new home health care providers while the Health Care Financing Administration devises new regulations to better screen applicants.

"During this moratorium, we'll develop tough new regulations to ensure that no fly-by-night providers enter or remain in the Medicare program," Clinton told the Service Employees International Union in Washington.

The administrative action requires current providers to submit to a review process every three years to ensure they are in compliance with the new regulations. The number of government audits of providers also will be doubled to weed out offenders.

The president took the action in response to recent studies showing that fraud has reached alarming proportions in the home health care business, the fastest-growing segment of the $200 billion Medicare program.

The administration believes that the government is bilked out of billions of dollars of Medicare expenditures every year. Fraud involving home health care services alone amounts to hundreds of millions of dollars a year, said Christopher Jennings, the president's health care adviser.

A report released earlier this summer by the inspector general of the Health and Human Services Department concluded that a staggering 40 percent of the services provided by home health care agencies in California and three other states should not have been reimbursed by Medicare. That represents $2.6 billion of the $6.7 billion spent on those services over a 15-month period ending March 31, 1996.

The government paid for an array of improper expenditures, the report showed, including excessive treatments, bills for services never performed and charges for patients who were not home- bound and therefore not eligible.

Clinton said the campaign to crack down on abuse will complement a broader effort to rein in Medicare spending under the balanced budget agreement approved by Congress this year. Such steps are necessary, he said, to restore public trust.

"No matter what changes we make in the structure of the program, we can't maintain it for what it should be if we tolerate unacceptable levels of fraud and abuse," Clinton said.

The new measures are particularly important because the number of elderly people receiving home health care under Medicare has mushroomed in recent years, from 1.7 million in 1989 to 3.9 million in 1996.

Medicare outlays for home health care have grown even more rapidly over the same time, from $2.4 billion in 1989 to $17.7 billion in 1996. By the year 2000, home health care costs are expected to exceed $21 billion.

Federal officials believe that unqualified entrepreneurs are swarming into the home health care business to reap potentially huge profits from Medicare. Because the services are provided in homes, verification is difficult. Until now, the certification process did not require basic safeguards such as background checks of an applicant's financial history or criminal record.

Pub Date: 9/16/97

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