Hospice Audits and Surveys: What to Expect & How to Prepare

Hospice agencies deal with various audits and surveys to ensure compliance with federal regulations, maintain quality patient care, and follow proper billing practices. These reviews can come from federal agencies, Medicare and Medicaid contractors, and quality assessment programs. Understanding these processes and their potential consequences can help hospices stay ahead and remain compliant. Failing an audit can result in claim denials, repayment demands, corrective action plans, or even exclusion from Medicare participation.

Common Types of Medicare Audits

Additional Documentation Requests (ADRs)

• Conducted by Medicare Administrative Contractors (MACs), these audits request specific documentation to support claims.
• Failure to respond may result in claim denials or recoupment.
• Check out our previous article on Navigating Hospice ADRs

 Targeted Probe and Educate (TPE)

TPE audits focus on specific areas of non-compliance, typically triggered by unusual billing patterns such as high utilization rates of services or consistently billing for services that exceed industry norms such as:
1. GIP

Approximately only around 1-3% of hospice patients should be classified as General Inpatient Care (GIP), meaning that only a tiny percentage of hospice patients should ever require this level of care, as it’s intended for situations where symptoms cannot be managed at home and require intensive, inpatient symptom management. Click here to learn more about GIP. 

Further, per 42 C.F.R. Section 418.302, Medicare limits the total number of inpatient days a hospice patient can use to no more than 20% of their total hospice days. When using GIP, every day of GIP care must be properly documented to demonstrate the ongoing need for this level of care. GIP utilization rates above average and GIP stays above 5 days may trigger increased scrutiny.

2. Excessive Continuous Home Care (CHC) billing (typical CHC use is less than 2% of hospice days nationally).

3. Billing Routine Home Care (RHC) at a significantly higher average length of stay compared to national or regional averages (e.g., over 200 days per patient may raise concerns).

4. High Claim Denial Rates. Common causes of high denial rates include:

• Missing or incomplete physician certifications of terminal illness.
• Inadequate documentation supporting the six-month prognosis requirement.
• Failure to provide timely or properly documented face-to-face encounters.

5. Provider Risk Assessments: Medicare and MACs assess hospices based on previous audits, financial outliers, or past corrective actions. Hospice agencies with frequent errors or inconsistencies are more likely to be selected. The process includes:

• A review of 20–40 claims per round, focusing on identified risk areas.
• If errors are found, hospices receive targeted education on correcting the issues.
• Providers with continued non-compliance across three rounds may be referred for further audits, including UPIC or RAC audits.

Failing a TPE audit can result in pre-payment reviews, claim denials, or increased regulatory scrutiny.

Click here to learn more about CMS TPE Audits

Unified Program Integrity Contractor (UPIC) Audits

UPIC audits are triggered by suspected fraud, waste, or abuse, often based on:

1. Data Analytics: Medicare identifies providers with unusual billing patterns, such as:

• Excessive length of stay: The national average hospice length of stay is approximately 90 days, but hospices with a median length of stay exceeding 180-200 days may be flagged.
• High proportion of long-term patients: Hospices where more than 50%-60% of patients have stays exceeding 180 days can be flagged for review.
• Unusually high billing for a specific level of care: If a hospice consistently bills more than 20%-25% of total days for GIP or CHC, it may trigger an audit.

2. Whistleblower Complaints: Employees, former staff, or even patients’ family members can report suspected fraud or abuse, leading to an investigation.

3. Referrals from Other Audits: If, for example, an agency has failed a TPE audit, or has been cited for repeated compliance issues, it may trigger a UPIC audit.

UPIC audits involve a detailed reviews of patient records and claims, investigations into billing anomalies, patient eligibility, and service necessity. Further, auditors may conduct interviews with staff, patients, or caregivers.

Consequences of a UPIC Audit:

• Overpayment demands requiring large repayment sums.
• Medicare billing suspension.
• Civil or criminal investigations for severe cases of fraud.

Click here to learn more about CMS UPIC Audits

Conditions of Participation (CoP) Surveys & Quality of Care Reviews

CoP surveys ensure that hospices meet Medicare’s Conditions of Participation, which define the minimum standards for patient care and operational compliance.

Types of CoP Surveys

1. Initial Certification Surveys: Required for new hospices seeking Medicare certification and involves surveyors assessing policies, procedures, and care delivery against Medicare standards.

2. Recertification Surveys: Conducted every 3 years to verify continued compliance with Medicare regulations. Non-compliance can lead to citations, corrective action plans, or loss of certification.

3. Complaint Investigations: Triggered by patient, family, or staff complaints, leading to unannounced surveys. If deficiencies are found, hospices may be subject to penalties, corrective plans, or loss of participation in Medicare.

4. Quality Reviews: Quality assessments focus on patient and family experiences, pain management, symptom control, and overall hospice care effectiveness such as: Hospice CAHPS (Consumer Assessment of Healthcare Providers and Systems) Surveys. This survey collects feedback from families regarding their hospice care experience. Poor scores can impact public reporting and reimbursement adjustments.

Click here to learn more about CMS Hospice CAHPS

These are additional audits hospice agencies may face such as RAC audits for overpayment recovery and state specific audits and more.  Hospice audits and surveys are critical for ensuring compliance, maintaining financial accuracy, and improving patient care. Understanding the different types of reviews and proactively preparing can help agencies navigate these processes with confidence.

To learn more, check out the CMS Hospice Center

 

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