Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
Medicare Home Health Agency Survey 
and Certification Deficiencies 
JUNE GIBBS BROWN 
Inspector General 
SEPTEMBER 2000 
OEI-02-99-00532  OFFICE OF INSPECTOR GENERAL 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, is to 
protect the integrity of the Department of Health and Human Services programs as well as the 
health and welfare of beneficiaries served by them.  This statutory mission is carried out through a 
nationwide program of audits, investigations, inspections, sanctions, and fraud alerts.  The 
Inspector General informs the Secretary of program and management problems and recommends 
legislative, regulatory, and operational approaches to correct them. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 
Inspector General.  It conducts short-term management and program evaluations (called 
inspections) that focus on issues of concern to the Department, the Congress, and the public.  The 
inspection reports provide findings and recommendations on the efficiency, vulnerability, and 
effectiveness of departmental programs. 
OEI's New York Regional Office prepared this report under the direction of John I. Molnar, 
Regional Inspector General, and Renee C. Dunn, Deputy Regional Inspector General.  Principal 
OEI staff included: 
REGION  HEADQUARTERS 
Demetra Arapakos, Project Leader
 Tricia Davis, Program Specialist

Miriam Gareau, Lead Analyst
 Brian Ritchie, Director, Technical Support Staff

Patricia Banta 
 Linda Moscoe, Technical Support

Lucille Cop

To obtain copies of this report, please call the New York Regional Office at (212) 264-2000. 
Reports are also available on the World Wide Web at our home page address: 
http://www.dhhs.gov/oig/oei  E X E C U T I V E  S U M M A R Y  
PURPOSE 
To determine if the extent and nature of Medicare home health agency survey and 
certification deficiencies, particularly relating to adequacy of care, have changed since the 
implementation of the Interim Payment System in 1997. 
BACKGROUND 
This inspection follows an Office of Inspector General report issued in November 1999

entitled Medicare Beneficiary Access to Home Health Care (OEI-02-99-00530).  In that

study, most hospital discharge planners report generally being able to place Medicare

beneficiaries with home health agencies; however, some volunteer concern that not all

beneficiaries may be getting adequate care.  This inspection follows up on those concerns. 

It is part of a series of inspections that the Office of Inspector General has conducted 

about home health care.

Home health services consist of skilled nursing, therapy (physical, occupational, and

speech), home health aide and other related services furnished in a patients home. 

Medicare regulations require that each patient have a plan of care, established by a

physician, that includes specific treatment information.  All home health agencies

participating in Medicare must be surveyed by the State in order to be certified as 

meeting Federal requirements. 

We combined four methods for this inspection: an analysis of survey deficiency data; 

interviews with State and the Health Care Financing Administration survey and certification

staff; a review of State survey deficiency reports; and a demographic data analysis.  For the

purpose of this study, we define adequate care to mean appropriate intensity and frequency

of services.  We assume the adequacy of care patients receive is indicated in part by the

extent to which their plans of care are appropriately developed 

and implemented.

FINDINGS 
Overall, home health agency deficiencies have increased, but there is 
no single explanation for this growth 
Deficiencies increased from 1997 to 1999 
Nationally, both the rate and total number of all home health deficiencies have grown 
between the first 6 months of 1997 and the first 6 months of 1999.  The deficiency rate 
Medicare HHA Survey and Certification Deficiencies  i  OEI-02-99-00532  (deficiencies per survey) increased by 26 percent, from 3.1  to 3.9.  At the same time, the 
total number of deficiencies grew by 53 percent, from 5,438 to 8,297. 
During our study time frames, 12 so called condition level deficiencies with numerous 
standards within them could be cited if one or more of those standards were not met. 
Condition level deficiencies are therefore broader and more severe in scope.  The rate for 
total condition level deficiencies went from .14 in 1997 to .23 in 1999, which is an increase 
of more than half. 
Inconsistent survey processes may result in different deficiency rates among 
States 
States differ in their deficiency rates, number of surveys, and survey protocols.  First, not 
all States have had an increase in their deficiency rates; about half have actually had a 
decrease. The sample States with a decrease attribute this to closures of poor care 
providers.  Also, the number of surveys conducted between 1997 and 1999 varies among 
States; nearly all States with an increase in the number of surveys also had an increase in 
deficiencies, while those with fewer surveys had fewer deficiency citations. 
Lastly, inconsistent survey processes among the 10 sample States, including survey 
schedules and interpretations of deficiency tags, contribute to different deficiency rates. 
Several reasons may account for the increase in deficiencies 
The State survey and certification and Health Care Financing Administration staff that we 
surveyed do not attribute the increase in deficiencies to any single factor.  Instead they 
point to several factors, including the following four. 
Changes to the home health survey schedule.  Most State and Health Care Financing 
Administration respondents say the change to the home health survey schedule that 
increased the interval between standard surveys has allowed agencies to develop and 
maintain patterns of poor care. 
Increased Federal involvement.  State respondents cite increased Federal initiatives and 
training as having strengthened survey protocols to make them more stringent. 
Declining quality of home health care.  A few State respondents directly attribute the 
increase to a declining quality of home health care. 
Interim payment system.  While no State respondents volunteer the interim payment 
system as a direct cause for the increase in deficiencies, some note that it may be affecting 
the amount of care agencies provide. 
Adequacy of care deficiencies are most common in both years 
Nationally, one fourth of all deficiencies in both 1997 and 1999 fall within what we call 
Medicare HHA Survey and Certification Deficiencies  ii  OEI-02-99-00532  the plan of care condition.  The majority of standards within this condition pertain to 
whether the plan of care is appropriately developed, followed, reviewed, and updated. 
Also, four of the six most common standard deficiencies fall within the plan of care 
condition, including the top deficiency, G158.  It is cited when patient care does not follow 
a written plan of care established and periodically reviewed by a physician. 
Based on our review of 100 survey deficiency reports, we identified four main categories of 
plan of care deficiencies. 
Agencies are not providing all ordered visits.  The agency is not providing as many 
nursing visits, home health aide visits, or therapy visits as were ordered by the physician in 
the plan of care. 
Agencies are not providing all treatments.  The agency is not providing all appropriate 
treatments during visits, such as monitoring patients weight and pressure sores. 
Agencies are not contacting physicians when necessary.  Agency staff are not alerting 
physicians when patients conditions worsen or their prescribed treatment should be 
changed. 
Agencies are not developing comprehensive plans of care.  Agencies are failing to 
appropriately develop a comprehensive plan of care for all of their patients. 
Less commonly, plan of care deficiencies also indicate that more care is provided than 
ordered. 
CONCLUSION 
Just as there is no single cause for the increase in home health agency deficiencies, there 
is no single course of action to be taken.  Instead, a combination of approaches may be 
appropriate, including strengthened State survey protocols and continued close scrutiny of 
the care being provided to home health beneficiaries. 
The nature of deficiencies being cited indicate that some beneficiaries may not be receiving 
all the care they need.  The introduction of the Prospective Payment System should in part 
address this concern, since it allocates more money for the most severe patients and 
establishes new payments every 60 days for long term patients.  At the same time, this new 
system could create or increase the incentive on the part of some home health agencies to 
shortchange Medicare home health beneficiaries in the amount and intensity of care 
provided.  It will therefore become even more important that the Health Care Financing 
Administration and the States closely monitor the quality of home health care.  We also 
intend to continue our own studies of all aspects of the implementation of the prospective 
payment system, including quality of care. 
Medicare HHA Survey and Certification Deficiencies  iii  OEI-02-99-00532  Comments 
The Health Care Financing Administration provided comments on this and two related 
draft reports.  They concur with our conclusion that there appears to be no single cause 
for the increase in deficiencies.  They also note that on October 1, 2000, the new 
prospective payment system for home health care will go into effect.  They, like we, will 
monitor care under the new system.  The Health Care Financing Administrations 
comments are in Appendix B. 
Medicare HHA Survey and Certification Deficiencies  iv  OEI-02-99-00532  T A B L E  O F  C O N T E N T S  
PAGE

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  i

INTRODUCTION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

FINDINGS 
Increase in deficiencies  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

Inconsistent processes among States  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

Reasons for increase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9

Most common deficiencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   11

CONCLUSION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14

APPENDIX 
A: List of recent OIG home health inspections  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15

B: Comments  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  16

Medicare HHA Survey and Certification Deficiencies  v  OEI-02-99-00532  I N T R O D U C T I O N  
PURPOSE 
To determine if the extent and nature of Medicare home health agency survey and 
certification deficiencies, particularly relating to adequacy of care, have changed since the 
implementation of the Interim Payment System in 1997. 
BACKGROUND 
This inspection follows an Office of Inspector General (OIG) report issued in November

1999 entitled Medicare Beneficiary Access to Home Health Care (OEI-02-99-00530).  In

that study, most hospital discharge planners report that they are generally able to place

Medicare beneficiaries with home health agencies; however, some discharge planners

volunteer their concern that not all Medicare patients may be getting adequate care.  By

adequate care, we mean the appropriate duration and intensity of services.  This 

inspection follows up on those concerns.  It is part of a series of inspections that the OIG

has conducted about home health care (see Appendix A).

Medicare home health care 
Home health care services consist of skilled nursing, therapy (physical, occupational, and 
speech) and certain related services, including aide services, all furnished in a patients 
home.  Services are typically provided by registered nurses, therapists, social workers, or 
home health aides employed by or under contract with a home health agency (HHA). 
These agencies can be free-standing or provider based and classified as not-for-profit, 
proprietary, or governmental. 
Medicare will pay for home health care only if it is reasonable and necessary for the 
treatment of the patients illness or injury.  In order for a beneficiary to qualify for 
Medicare coverage of home health services, he/she must be confined to home, require at 
least one skilled service, and be under the care of a physician who has established a plan 
of care.  Skilled services are defined as intermittent skilled nursing services, physical 
therapy, speech therapy, and a continued need for occupational therapy. 
During much of the 1990's, Medicare spending for home health services increased 
substantially.  From 1990 to 1997, Medicare expenditures rose from $3.7 billion to $17.8 
billion.  This resulted from both an increase in the number of beneficiaries who received 
home health services and an increase in the number of visits they received.  In 1999, 
however, Medicare spending for home health services decreased to a total of approximately 
$9.5 billion.  Further, the average home health length of stay went from 98 
Medicare HHA Survey and Certification Deficiencies  1  OEI-02-99-00532  days in 1997 to 58 days in 1999.  The number of beneficiaries served also decreased, 
from 462,000 in 1997 to 358,000 in 1999. 
Beginning in 1995, several initiatives were implemented to address concerns about fraud 
and abuse and to control the costs of Medicare home health.  These included the creation 
of an anti-fraud campaign entitled Operation Restore Trust, changes to Medicare 
participation rules designed to screen out problem providers, and, most recently, 
payment limits created by the Balanced Budget Act of 1997 (BBA). 
Survey and certification process 
All home health agencies participating in Medicare must be certified and approved by 
meeting certain Federal requirements and conditions of participation.  The certification 
process includes routine on-site surveys that HCFA contracts with State agencies to 
perform.  As mandated by statute, agencies can go without a standard survey no longer 
than 36 months after the previous survey.  If they are found to have serious deficiencies 
during a standard survey, the State will conduct an extended survey.  During a home health 
survey, State surveyors select two case-mix stratified samples of patients based on 
a pre-existing formula, one sample for a medical record review only and a second for a 
medical record review and home visit.  During the record review, surveyors assess the 
services that the HHA is providing by reviewing the plan of care, medical record, and 
agency chart.  They visit the beneficiarys home to determine if the patient is in the 
condition that the HHA reports.  Surveyors identify areas where the agency has failed to 
comply with Federal regulations.  These deficiencies are cited and the agency is required to 
write a plan of correction. 
During the time frames we examined, deficiencies were cited under any of 153 specific 
deficiency tags, which included 12 condition level deficiencies and 141 standard level 
deficiencies.  The condition level deficiencies, based on the conditions of participation, 
are broader and more severe in scope, and they encompass more specific standards within 
them.  For example, the condition level tag G156 - acceptance of patients, plan of care, and 
medical supervision - includes 12 standard level deficiencies for various aspects of care that 
fall into this category.  Generally, an HHA will be cited with a condition level deficiency if 
one or more of the standards within it are not met.  In June 1999, three additional 
conditions related to the incorporation of the Outcome Assessment and Information Set 
were established. 
Several recent changes have occurred in the survey process.  First, due to a moratorium 
on the formation of new Medicare home health agencies from September 1997 to January 
1998, no new initial surveys were conducted during these time periods.  Second, beginning 
in October 1996, the mandated survey schedule changed from every 9 to 15 months to a 
variable 36 month schedule.  The HCFA developed comprehensive criteria to determine 
HHA survey frequency.  Thus, if an agency is not cited with major deficiencies or has no 
change in ownership, it will typically be surveyed every 3 years.  New agencies 
Medicare HHA Survey and Certification Deficiencies  2  OEI-02-99-00532  must be surveyed annually for the first 3 years, and a new standard survey must also be

conducted when a change of ownership occurs. 

National data on home health agency survey and certification deficiencies is tracked by

HCFA in the Online Survey Certification and Reporting System (OSCAR).  The OSCAR

tracks each agencys deficiencies for the past three survey periods as well as the current

survey period. 

In lieu of obtaining Medicare certification from the State, agencies can be deemed by a

HCFA approved accreditation organization.  The HCFA currently authorizes two 

deeming organizations: the Joint Commission for Accreditation of Healthcare

Organizations (JCAHO) and the Community Health Accreditation Program (CHAP). 

The home health agencies are surveyed by the accrediting agency and the survey results 

are shared with HCFA.  Approximately 200 home health agencies nationwide have deemed

status. 

Home health plans of care 
Medicare regulations require that each patient have a plan of care.  This plan should include

specific information such as all pertinent diagnoses, types of services and equipment

required, frequency of visits, prognosis, medications, and instructions for timely discharge

or referral. The plan of care must also contain the physicians orders for services and his or

her signature.  Currently, the physician is required to review the plan 

of care with agency staff at least every 62 days.  As of October 1, 2000, the time period 

for review will be every 60 days.

A plan of care is generally developed through a collaborative process involving the

physician, the home health agency, and the patient or family.  If the patient is in the hospital

when the referral for home health care is made, the home health agency may have its own

nurse assess the patient in the hospital, talk to the patient and/or family, and discuss his or

her treatment needs with the physician.  At this time the agency nurse may develop a

preliminary plan of care which can be reviewed by the physician.  After the patient is

released from the hospital, an agency nurse or therapist will be assigned to the patients

case and make a home visit.  After assessing the home, talking to the patient and to the

physician, the agency will modify the plan as needed.  The physician may then sign the plan. 

If the patient is not in the hospital at the time of the home health referral, the same process

is generally followed but does not begin until the agencys first visit to the home.

The Balanced Budget Act of 1997 
The Balanced Budget Act (BBA) of 1997 changed the way Medicare pays for home 
health care.  The law requires a payment change from a cost-based method to a prospective 
payment system (PPS) of fixed, predetermined rates for home health services.  The HCFA 
has proposed a national 60-day episode payment which will be case-mix 
Medicare HHA Survey and Certification Deficiencies  3  OEI-02-99-00532  adjusted based on the patients medical assessment and the projected number of therapy 
hours needed in the 60-day episode. 
Until this PPS is implemented, however, home health agencies are reimbursed under an 
interim payment system (IPS) which imposes payment limits on their services.  The IPS 
was implemented on October 1, 1997 and will continue to be in place until the PPS 
begins on October 1, 2000.  The IPS is intended to control the aggregate costs of services 
provided to beneficiaries.  In addition to reducing the per-visit limit, it subjects Medicare 
HHAs to a new payment limit that is based on an aggregate per-beneficiary amount; this 
cap is applied to an agencys total Medicare payments and does not limit payments for 
specific beneficiaries.  The Omnibus Consolidated and Emergency Supplemental 
Appropriations Act of 1999 made several changes to the payment limits, including 
increasing the per-visit limits for all agencies and increasing the aggregate beneficiary limit 
for certain agencies.  Agencies can use several methods to keep costs below their payment 
limits, including balancing their mix of low and high cost patients, reducing 
their costs overall, and increasing their proportion of low-cost patients. 
In the fall of 1999, Congress enacted the Medicare, Medicaid, and SCHIP Balanced 
Budget Act of 1999, which delayed a 15 percent payment reduction to be imposed with the 
implementation of PPS and increased payments under IPS to certain agencies. 
OASIS 
Home health agencies use a data collection system called the Outcome and Assessment 
Information Set (OASIS) as part of their conditions of participation.  All HHAs have 
been required to collect OASIS data on all patients receiving skilled care, regardless of 
payment source, since July 1999.  The OASIS data elements focus primarily on the 
patients medical status and include socio-demographic, environmental, support systems, 
health status, and functional status information on each patient.  Information on hospital re-
admissions and emergency room visits is also captured.  The OASIS can be used by home 
health agencies to determine patients treatment needs, develop plans of care, and monitor 
quality of care. 
Related home health studies 
In addition to our recent inspection report,  Medicare Beneficiary Access to Home 
Health Agencies, several other studies have been released recently that discuss access to 
and adequacy of home health care.  A Medicare Payment Advisory Commission 
(MEDPAC) study on access to home health services found that some agencies are likely 
to discharge certain types of patients earlier because of the new payment system. 
Additionally, a George Washington University study reported that agencies are altering 
admissions standards and reducing clinical and administrative staff.  It also found that 
chronically ill patients are experiencing greater fragmentation and disruption of care and 
that some patients were receiving insufficient intensity or duration of home health care 
services.  Further, a study by the Institute for Health Care Research and Policy at 
Medicare HHA Survey and Certification Deficiencies  4  OEI-02-99-00532  Georgetown University found that similar patients with greater use of home care services 
are more likely to experience health improvements than those with low home care 
utilization. 
Finally, HCFA has completed two PPS demonstration projects.  The latest, which looks 
at per-episode payments, found no evidence that quality of care, as measured by patient 
outcomes, had been adversely affected by the per-episode PPS demonstration.  It also 
found that the per-episode payment substantially reduced the number of home visits 
without increasing the use of other Medicare services.  Based on an analysis of claims data, 
HCFA found lower usage of emergency rooms by per-episode PPS patients and no 
significant differences in institutional admissions for home health diagnoses. The report 
therefore concluded that a per-episode based home health PPS could reduce Medicare 
costs without harming quality of care. 
METHODOLOGY 
We combined four methods for this inspection: an analysis of OSCAR deficiency data; 
telephone or in-person interviews with State and HCFA survey and certification staff; a 
review of State survey deficiency reports; and a demographic data analysis. 
Definition of adequacy of care 
For the purpose of this study, we are defining adequate care to mean appropriate intensity

and frequency of services.  In particular, we assume that the adequacy of care 

beneficiaries receive is indicated, in part, by the extent to which their plan of care is

appropriately developed and implemented.  We therefore focused our analysis on deficiency

data pertaining to the plan of care. We note that adequacy of care can also be defined to

include other facets of care, such as coordination of services and communication between

care providers. 

In this study, we also differentiate between adequacy of care and quality of care.  For the

former, we mean intensity and duration of services.  For the latter, we mean the quality of

services provided.  For example, the quality of care being provided by a skilled physical

therapist may be very high, but the number of times such care is provided may not be

sufficient to meet a patients needs and, therefore, not adequate.

Analysis of OSCAR deficiency data 
As already discussed, national data on home health agency survey and certification 
deficiencies is tracked by HCFA in the Online Survey Certification and Reporting 
System (OSCAR).  During the time frames we examined, deficiencies were cited under any 
of 153 specific deficiency tags, which included 12 condition level deficiencies and 141 
standard level deficiencies.  We analyzed OSCAR data for all home health agency surveys 
conducted in the first 6 months of 1997 and the first 6 months of 1999.  This 
Medicare HHA Survey and Certification Deficiencies  5  OEI-02-99-00532  enabled us to compare an analogous time frame before and after IPS was implemented. 

This time period is also the same one being used in the OIG study on hospital and

emergency room re-admission rates.

For both years, we examined the following three levels of OSCAR data:

C  overall deficiencies;

C  the 12 condition level deficiencies, which are more severe in scope; and 

C  standard level deficiencies, particularly those relating to the plan of care. 

From the first 6 months of 1997 to the first 6 months of 1999, we calculated the percentage

change in the number of deficiencies and the percentage change in the deficiency rate (the

number of deficiencies cited per survey).  To determine the number of surveys conducted

during each of our two time frames, we counted each unique provider number listed as one

survey. 

State and HCFA survey and certification staff interviews and discussions 
We selected a purposive sample of 10 States to include States with both increases and 
decreases in deficiency rates and States with geographical differences.  These 10 States 
are Arizona, California, Connecticut, Florida, Idaho, Illinois, Louisiana, New York, Ohio, 
and Texas. 
We conducted a total of 20 structured State interviews for this inspection.  In each of the 
10 States, we spoke with the survey and certification director or other manager and a 
home health surveyor.  In two of the States, New York and Connecticut, we conducted 
these interviews in-person.  For the remaining eight States, we conducted our interviews by 
telephone.  During these interviews, we asked respondents questions about their State 
survey process, recent changes to the process, and for their perspectives on home health 
care trends. 
We also had discussions with regional and headquarters HCFA staff.  During these 
interviews, we asked respondents questions about HCFA policies on home health agency 
surveys, recent changes in survey policies and procedures, and for their perspectives on 
home health care trends. 
Review of survey deficiency reports 
We asked each of our sample States to send us 10 survey deficiency reports (HCFA form 
2567) from surveys conducted in 1999, mostly during the first 6 months, for a total of 100 
reports.  We asked for reports that specifically included any of 12 deficiency tags we 
identified as indicating adequacy of care.  We then used structured review sheets to 
determine if the deficiencies cited related to documentation or adequacy of care issues.  We 
also used this review to look for specific examples of inadequate care that illustrated typical 
problems found with deficient home health agencies. 
Medicare HHA Survey and Certification Deficiencies  6  OEI-02-99-00532  Demographic data analysis 
Finally, we conducted a demographic analysis in order to determine if the Medicare home

health population differed from the first 6 months of 1997 to the first 6 months of 1999. 

First, using a one percent sample of the National Claims History (NCH) File, we 

identified all beneficiaries who had a home health service from between January 1, 1997,

and June 30, 1997, and between January 1, 1999, and June 30, 1999.  We then merged 

this data with data from a one percent sample of inpatient claims to determine which

beneficiaries had a hospital discharge within 30 days prior to the start of their home 

health services.  This enabled us to determine the percentage of the home health population

that had a prior hospitalization during both time periods. 

We also merged our National Claims History File data with data from the  Enrollment

Database (EDB) to compare the variables of age, race, sex, and diagnosis for the home

health population in our two time frames.

This analysis indicated no changes in the age, sex, and race of home health beneficiaries.  It

did, however, show an increase from 48 percent to 55 percent in prior hospitalization rates.

Limitations 
There are several limitations to our methodology.  First, this inspection is not intended to 
attribute any change in deficiencies to a particular factor, since many reasons may 
contribute to increases in deficiency rates.  Further, we note that States have not been 
consistent in their reporting of OSCAR survey data.  Lastly, the structure of the OSCAR 
file does not permit a trend analysis over time, since data is maintained based on each home 
health agencys unique survey schedule. 
This inspection was conducted in accordance with the Quality Standards for 
Inspections issued by the Presidents Council on Integrity and Efficiency. 
Medicare HHA Survey and Certification Deficiencies  7  OEI-02-99-00532  F I N D I N G S  
Overall, home health agency deficiencies have increased, 
but there is no single explanation for this growth 
Deficiencies increased from 1997 to 1999 
Both the overall rate and the total number of all deficiencies have increased 
Nationally, both the rate and total number of all home health agency deficiencies have 
grown between the first 6 months of 1997 and the first 6 months of 1999.  The deficiency 
rate increased by 26 percent, from 3.1 in 1997 to 3.9 in 1999.  At the same time, the total 
number of deficiencies grew by 53 percent, from 5,438 in the first 6 months of 1997 to 
8,297 in the first 6 months of 1999.  The deficiency rate is defined as the number of 
deficiencies cited per survey.  Since the total number of surveys conducted increased by 20 
percent between 1997 and 1999, from 1763 to 2112, in order to control for this change we 
will report only deficiency rates for the remainder of the report. 
During our study time frames, 12 so called condition level deficiencies with numerous 
standards within them could be cited if one or more of those standards were not met. 
Condition level deficiencies are therefore broader and more severe in scope.  If a home 
health agency is found to have a condition level deficiency, it is considered to provide 
substandard care and must undergo an extended survey to determine if it meets the 
conditions of Medicare participation.  The rate for total condition level deficiencies went 
from .14 in 1997 to .23 in 1999, which is an increase of more than half. 
Inconsistent survey processes may result in different deficiency rates 
among States 
Some States increased while others decreased 
Not all States have had an increase in their deficiency rates between 1997 and 1999.  About

half have actually had a decrease.  Survey and certification respondents from those  sample

States with a decrease in deficiency rates say that recent agency closures have

resulted in fewer deficiencies being cited.  In particular, they note that many of the agencies

that closed did not provide good care.  One survey director notes, Many agencies with

care problems went out of business. 

The numbers of surveys conducted between 1997 and 1999 also varies among States, 

with a few States having significant increases.  In the State with the largest increase,

respondents attribute the increase to changes in agency ownership and facility mergers, 

Medicare HHA Survey and Certification Deficiencies  8  OEI-02-99-00532  which require that a new standard survey be conducted.  While about half of all States have 
had some increase between 1997 and 1999, one third have had decreases, and the 
remaining have had no change.  Nearly all of the States that have had an increase in the 
number of surveys conducted also saw an increase in the number of deficiencies cited. 
Similarly, most of the States with fewer surveys have fewer deficiency citations. 
Different survey protocols are noted among the 10 sample States 
Our interviews with survey and certification staff in the 10 sample States, as well as our

review of survey reports, reveal inconsistencies among State survey procedures in 1999

that may affect deficiency rates.  First, not all States follow the same survey schedule; while

most follow the HCFA variable 36 month schedule, within this schedule some States are

surveying agencies more frequently than others.  Further, States allocate their survey staff

resources differently.  In some, surveyors specialize in home health care 

only, while in others, survey staff are responsible for other types of providers as well, 

such as nursing homes and hospices.  Additionally, some State respondents note that 

there is high staff turnover among surveyors. 

Surveyors also do not appear to consistently interpret and cite deficiencies on their 

reports.  In one State, survey respondents say that they had been citing few if any

deficiencies at all in 1997.  In reviewing different States survey deficiency reports, we

noticed that similar problems are cited under different deficiency tags.  For example, a

registered nurse may fail to alert a patients physician of the need to alter his plan of care

because it does not reflect his medical condition and needs; this deficiency can be cited

under tag G164 (agency staff promptly alert the physician to any changes that suggest a

need to alter the plan of care), tag G173 (duties of the registered nurse), or both.  We also

noticed that variation in surveyors professional judgement and discretion may affect

whether or not a condition level deficiency is cited.  State respondents say they look at 

the scope and severity of the problem when determining whether to cite a deficiency.

Typically, one report may cite a deficiency for a single occurrence, while another will cite

the same deficiency for multiple occurrences. 

Several reasons may account for the increase in deficiencies 
The State survey and certification and HCFA staff we surveyed do not attribute the 
increase in deficiencies to any single factor.  Instead, they point to several factors, including 
the following four. 
Change in survey schedule 
Most of the States we surveyed, as well as HCFA respondents, cite changes to the home 
health survey schedule as having had an impact on deficiency rates.  As noted in the 
background, beginning in 1996, HCFA changed the survey schedule to require that 
agencies be surveyed up to every 36 months after a previous standard survey, or more 
Medicare HHA Survey and Certification Deficiencies  9  OEI-02-99-00532  frequently if necessary.  The schedule prior to this change was every 9 to 15 months. 
Both State and HCFA respondents believe that the decrease in survey frequency may be 
allowing home health agencies to develop and maintain patterns of poor care.  One State 
respondent notes, Agencies may become more lax if they know were not in there every 
year.  A HCFA respondent concurs, Agencies that are on a 3 year cycle are getting into 
bad habits.  Nobody is checking up on them. 
A shift in survey and certification resources appears to have led to the change in the home 
health survey schedule.  The HCFA respondents note that the majority of Federal oversight 
now goes towards nursing home providers.  In half of the 10 sample States, respondents 
say that there were more home health surveyors in 1997 than there were in 1999.  In one 
State, the director notes that funding for home health surveys has decreased due to funding 
increases for nursing home surveys. 
Increased Federal initiatives and more stringent survey protocols 
Some State survey and certification respondents also cite increased Federal initiatives, 
including training they have received from HCFA and Operation Restore Trust (ORT) 
activities, as having strengthened their survey protocols to make them more stringent.  In 
particular, they say that training provided to surveyors has increased their awareness of 
what to focus on during survey visits and how to appropriately interpret deficiency tags, 
thus resulting in more deficiencies being cited.  In one State, HCFA re-trained the survey 
staff at the end of 1997 and beginning of 1998.  Prior to this training, surveyors were only 
counting home health visits and looking at agency policies; they did not assess the care 
being provided or patient outcomes.  A surveyor in another State notes, Our training 
from HCFA has helped me to know what to look for.  I am more likely to look a little 
deeper. 
In addition to providing more training, ORT appears to have had other effects on the 
survey process.  Beginning in October 1997, any agency that is part of a State, regional, 
or national fraud and abuse initiative must be surveyed at least every 12 months.  In one 
State, the director says that both the volume and intensity of surveys increased as a result 
of ORT.  The survey director in another State notes that since ORT, his staff has done a 
better job enforcing the homebound eligibility requirement. 
Declining care 
A few State respondents directly attribute the increase in deficiencies to the declining care 
being provided by home health agencies.  They say deficiencies have increased due to 
missed home health nursing, home health aide, and therapy visits as well as to poor 
documentation.  One surveyor says that corners are cut and mistakes are made.  These 
respondents also mention that staffing shortages in home health agencies may be 
adversely affecting the care being provided. 
Medicare HHA Survey and Certification Deficiencies  10  OEI-02-99-00532  Interim Payment System 
Finally, while no State survey and certification respondents volunteer IPS as a direct 
cause for the increase in deficiencies, some note that this reimbursement system may be 
affecting the amount of care that agencies provide.  Several State respondents say that 
agencies are reducing the frequency of home health aide visits.  One mentions that the 
intensity of physical therapy services being provided is not sufficient.  Furthermore, some 
State respondents note that IPS has caused agencies to close or to be more selective of 
their case mix, being less inclined to accept patients with more intense or chronic care 
needs. 
Adequacy of care deficiencies are most common in both years 
One fourth of all deficiencies fall within the plan of care condition 
The plan of care condition (G156) is defined as acceptance of patients, plans of care, 
and medical supervision.  The majority of standards within this condition pertain to 
whether the plan of care is appropriately developed, followed, reviewed, and updated.  This 
condition has the most deficiency citations in the first 6 months of both 1997 and 1999.  In 
both years, one fourth of all deficiencies were cited under this condition. 
Four of the top six standard deficiencies fall within the plan of care condition 
Nationally, in both 1997 and 1999, four of the six most commonly cited standard 
deficiencies fall within the plan of care condition.  In both years, the top deficiency 
standard is G158, which is cited when care does not follow a written plan of care 
established and periodically reviewed by a physician.  The remaining three tags are G159 
(the appropriate development of a plan of care), G165 (the appropriate administration of 
drugs and treatment as ordered by a physician), and G164 (the prompt notification of the 
physician when changes in a patients health status suggest the need to alter the plan of 
care). 
Based on our review of survey reports, plan of care deficiencies fall into four 
major categories 
Based on our review of 100 survey deficiency reports, it appears that agencies cited with 
plan of care deficiencies are not providing all ordered services.  More specifically, we found 
four main areas of deficiencies: the agency is not providing as many nursing visits, home 
health aide visits, or therapy visits as were ordered by the physician in the plan of care; the 
agency is not providing all appropriate treatments during visits; agency staff are not alerting 
physicians when patients conditions worsen or treatment needs change; and the agency is 
not appropriately developing a comprehensive plan of care.  While in some instances 
deficiencies are being cited only due to poor documentation, in most cases these 
Medicare HHA Survey and Certification Deficiencies  11  OEI-02-99-00532  deficiencies indicate that poor care is being provided.  We provide the following 
examples of each of these types of deficiencies. 
Failure to provide all ordered visits: 
<	 One agency was cited for failing to provide home health aide services as 
frequently as ordered.  For one patient, aide services were ordered for three to five 
times per week.  The agency failed to provide any aide services at all during one 
week and provided only two visits during another. 
<	 One agency was cited for failing to provide all ordered physical therapy and 
occupational therapy visits.  For one patient, two physical therapy visits and two 
occupational therapy visits were ordered weekly, but the patient received only one 
of each type of visit in the weeks reviewed.  Another patient at the same agency 
received no physical therapy services at all, despite physician orders for two such 
visits a month. 
<	 Another agency was cited for failure to provide the intensity of skilled nursing visits 
as ordered by the physician for 7 of 10 sampled patients.  Of these 7 patients, the 
skilled care provided was half of the ordered 16 hours per day throughout the 10 to 
16 weeks when services were provided. 
Failure to provide all ordered treatments during visits: 
<	 In one agency, patient weights were not adequately monitored.  In one case, a nurse 
failed to take a weekly weight as ordered for a patient with congestive heart failure 
during three of nine visits, despite documented symptoms of fluid retention, such as 
shortness of breath. 
<	 Another agency was cited because the nurse failed to change the dressing of a 
patients wound every three to four days, which was as often as called for in the 
patients plan of care. 
<	 One agency failed to provide all ordered treatments in seven of eight records 
reviewed.  One patient with a head injury who was bed-bound and completely 
dependent on skilled services was not periodically re-positioned and turned every 1 
12 hours as ordered and was left on a prone position for as long as 7 hours at a 
time.  This patient was also not provided with ordered tracheotomy and gastrotomy 
tube care and foley catheter care. 
Failure to alert physicians when patients conditions worsen or treatment needs 
change: 
<	 One agency failed to notify the physician when a patient weighing only 120 pounds 
lost 9 pounds in less than 1 month. 
Medicare HHA Survey and Certification Deficiencies  12  OEI-02-99-00532  <	 At another agency, the physician was not notified of two new open wounds on a 
patients leg or of significant increase in edema of the leg.  Consequently, the leg 
increased in size from 36 cm to 43 cm in just 1 week. 
<	 In one extreme case, there was no communication by the skilled nurse to the 
physician or to the director of patient services and nurse supervisor about a 
patients elevated temperature.  According to the surveyor, a missed visit during 
this 3 day episode of elevated temperature compounded the problem.  On the day 
following the missed visit, the patient was admitted to the hospital and died the 
evening of the next day. 
Failure to appropriately develop a comprehensive plan of care: 
<	 One agency failed to include all required information in the plans of care for 13 of 
15 patient records reviewed by surveyors.  These plans of care typically lacked 
instructions for the delivery of services, such as the frequency of visits.  Other 
missing information pertained to the patients prognoses and discharge plans. 
<	 In another agency, a patient with multiple diagnoses had a plan of care that lacked 
specific interventions and directives related to blood glucose and nutritional 
monitoring, assessment and status of skin integrity, and psycho social issues. 
Despite clinical documentation of a worsening condition in all of these categories, 
including the development of stage II pressure sores, no further interventions or 
communications with the physician were made. 
In most of the examples cited the agency did submit a plan of correction that addressed the 
problems found.  These plans of corrections were subsequently approved by the State. 
Less commonly, plan of care deficiencies also indicate that more care was 
provided than ordered 
Our review also revealed cases where agencies provided more care than ordered by 
physicians in the plan of care.  More specifically, they provided more visits or performed 
additional or different treatments than were ordered.  Examples of this include: 
<	 One agency provided an occupational therapy evaluation as well as six occupational 
therapy visits without the physician having ordered them. 
<	 Another agency provided skilled nursing visits three times per week even though 
the physician ordered only one visit per week.  The agency explained that after the 
registered nurse completed an initial assessment of the patient, she felt the patient 
needed more skilled nursing care than ordered.  However, there was no 
documentation that the agency consulted the physician about this change. 
Medicare HHA Survey and Certification Deficiencies  13  OEI-02-99-00532  C O N C L U S I O N  
Just as there is no single cause for the increase in home health agency deficiencies, there is 
no single course of action to be taken.  Instead, a combination of approaches may be 
appropriate, including strengthened State survey protocols and continued close scrutiny of 
the care being provided to home health beneficiaries. 
The nature of deficiencies being cited indicate that some beneficiaries may not be receiving 
all the care they need. The introduction of the Prospective Payment System should in part 
address this concern, since it allocates more money for the most severe patients and 
establishes new payments every 60 days for long term patients.  At the same time, this new 
system could create or increase the incentive on the part of some home health agencies to 
shortchange Medicare home health beneficiaries in the amount and intensity of care 
provided.  It will therefore become even more important that HCFA and the States closely 
monitor the quality of home health care.  We also intend to continue our own studies of all 
aspects of the implementation of the prospective payment system, including quality of care. 
Comments 
The Health Care Financing Administration provided comments on this and two related 
draft reports.  They concur with our conclusion that there appears to be no single cause for 
the increase in deficiencies.  They also note that on October 1, 2000, the new prospective 
payment system for home health care will go into effect.  They, like we, will monitor care 
under the new system.  The Health Care Financing Administrations comments are in 
Appendix B. 
Medicare HHA Survey and Certification Deficiencies  14  OEI-02-99-00532  APPENDIX A 
Selected List of Other Recent Office of Inspector General

Home Health Inspections

Office of Inspector General, US Department of Health and Human Services, Medicare 
Beneficiary Access to Home Health Agencies, OEI-02-99-00530, October 1999. 
Office of Inspector General, US Department of Health and Human Services, Medicare 
Beneficiary Access to Home Health Care: 2000, OEI-02-00-00320, September 2000. 
Office of Inspector General, US Department of Health and Human Services, Adequacy of Home 
Health Services: Hospital Re-Admissions and Emergency Room Visits, OEI-02-99-00531, 
September 2000. 
Medicare HHA Survey and Certification Deficiencies  15  OEI-02-99-00532  APPENDIX B 
Agency Comments

In this appendix, we present comments from the Health Care Financing Administration. 
Medicare HHA Survey and Certification Deficiencies  16  OEI-02-99-00532  Medicare HHA Survey and Certification Deficiencies  17  OEI-02-99-00532  Medicare HHA Survey and Certification Deficiencies  18  OEI-02-99-00532  Medicare HHA Survey and Certification Deficiencies  19  OEI-02-99-00532