Department of Health and Human Services
 

OFFICE OF 

INSPECTOR GENERAL 

DEFICIENCY HISTORY AND 


RECERTIFICATION OF MEDICARE 


HOME HEALTH AGENCIES
 

Daniel R. Levinson
 

Inspector General 


August 2008
 

OEI-09-06-00040
 
 

 

 

 

 

 

Office of Inspector General
 http://oig.hhs.gov 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services 

(HHS) programs, as well as the health and welfare of beneficiaries served by those 

programs. This statutory mission is carried out through a nationwide network of audits, 

investigations, and inspections conducted by the following operating components: 

Office of Audit Services 

The Office of Audit Services (OAS) provides auditing services for HHS, either by conducting 

audits with its own audit resources or by overseeing audit work done by others. Audits 

examine the performance of HHS programs and/or its grantees and contractors in carrying 

out their respective responsibilities and are intended to provide independent assessments of 

HHS programs and operations. These assessments help reduce waste, abuse, and 

mismanagement and promote economy and efficiency throughout HHS. 

Office of Evaluation and Inspections 

The Office of Evaluation and Inspections (OEI) conducts national evaluations to provide 

HHS, Congress, and the public with timely, useful, and reliable information on significant 

issues. These evaluations focus on preventing fraud, waste, or abuse and promoting 

economy, efficiency, and effectiveness of departmental programs. To promote impact, OEI 

reports also present practical recommendations for improving program operations. 

Office of Investigations 

The Office of Investigations (OI) conducts criminal, civil, and administrative investigations 

of fraud and misconduct related to HHS programs, operations, and beneficiaries. With 

investigators working in all 50 States and the District of Columbia, OI utilizes its resources 

by actively coordinating with the Department of Justice and other Federal, State, and local 

law enforcement authorities. The investigative efforts of OI often lead to criminal 

convictions, administrative sanctions, and/or civil monetary penalties. 

Office of Counsel to the Inspector General 

The Office of Counsel to the Inspector General (OCIG) provides general legal services to 

OIG, rendering advice and opinions on HHS programs and operations and providing all 

legal support for OIG’s internal operations. OCIG represents OIG in all civil and 

administrative fraud and abuse cases involving HHS programs, including False Claims Act, 

program exclusion, and civil monetary penalty cases. In connection with these cases, OCIG 

also negotiates and monitors corporate integrity agreements. OCIG renders advisory 

opinions, issues compliance program guidance, publishes fraud alerts, and provides other 

guidance to the health care industry concerning the anti-kickback statute and other OIG 

enforcement authorities. 
 

INTRODUCTION Δ EXECUTIVE SUMMARY 

OBJECTIVE 

To determine: 

1.	 the extent to which Medicare home health agencies (HHA) 

repeated the same deficiency citations across three consecutive 

surveys, and 

2.	 whether the Centers for Medicare & Medicaid Services (CMS) 

uses deficiency history in its oversight of HHAs. 

BACKGROUND 

Medicare’s home health benefit provides treatment for beneficiaries who 

have short- or long-term illnesses or injuries and who are confined to 

their homes. Services provided by a Medicare HHA include skilled 

nursing services, therapeutic services (physical and occupational 

therapy and speech-language pathology), home health aide services, 

medical social services, and certain medical supplies and equipment. In 

recent years, this benefit has grown in terms of Medicare beneficiaries 

receiving home health services, expenditures, and number of HHAs. 

All HHAs participating in the Medicare program must be compliant 

with 15 Medicare Conditions of Participation (CoP) and 69 standards. 

CMS contracts with State agencies to conduct initial HHA certification 

and recertification surveys to determine CoP compliance. Since fiscal 

year 2006, pursuant to section 1891(c)(2)(A) of the Social Security Act, 

all HHAs have been subject to a recertification survey at least once 

every 36 months. In addition, State agencies annually survey a 

5-percent targeted sample of at-risk HHAs. CMS uses an algorithm to 

identify at-risk HHAs. An HHA that receives one or more standardlevel or condition-level deficiencies must respond to the State agency 

with a plan of correction. An HHA with one or more condition-level 

deficiencies must come back into compliance within 90 calendar days 

from the completed survey date. Noncompliance with one or more CoP 

is cause for termination of participation. Termination is the only 

sanction available to CMS in response to HHA noncompliance. CMS 

has not implemented intermediate sanctions against HHAs as directed 

by the Omnibus Budget Reconciliation Act of 1987 (OBRA 1987). 

The report findings are based primarily on analysis of data from CMS’s 

Online Survey Certification and Reporting System (OSCAR). We 

analyzed survey data for 5,661 active Medicare-certified HHAs as of 

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EXECUTIVE SUMMARY 

January 11, 2007. We also interviewed staff at CMS headquarters and 

regional offices, State agencies, and HHAs. 

FINDINGS 

Fifteen percent of HHAs repeated the same deficiency citation on 

three consecutive surveys. These cyclically deficient HHAs’ most 

frequently repeated deficiency citation is related to patient plans of 

care. On the three most recent surveys, these HHAs received, on 

average, twice as many deficiency citations per survey compared to 

HHAs that did not repeat citations. Among cyclically deficient HHAs, 

most are located in six States and tend to be concentrated in highly 

populated areas. 

CMS oversight of HHAs could be improved. Currently, CMS does not 

use all available deficiency history information in its oversight of HHAs. 

We found that deficiency history beyond the most recent survey can be 

an important indicator of performance on the next survey and can 

improve CMS’s identification of at-risk HHAs. For HHAs with one or 

more condition-level deficiencies, CMS has no sanction other than 

initiating a termination track. 

RECOMMENDATIONS 

Based on our findings, we recommend that CMS: 

Use existing survey data to identify patterns of deficiency citations 

and at-risk HHAs. CMS should require surveyors to review all 

available survey data prior to each upcoming survey. In addition, CMS 

should include multiple survey results in its algorithm that identifies 

HHAs that are at risk of providing poor quality of care. 

Implement intermediate sanctions as directed by the OBRA 1987. 

Currently, termination from the Medicare program is the only sanction 

for poor-performing HHAs. Intermediate sanctions may include civil 

money penalties, suspension of all or part of Medicare payments, and 

appointment of temporary management for cyclically deficient HHAs. 

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E X E CUTIVE S U MMAR Y 
 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

CMS generally concurred with our recommendations. CMS indicated 

that, during the last several years, it has implemented improvements to 

the oversight of HHAs, many of which address the issue of repeated 

deficiencies. 

CMS concurred, in part, with the recommendation that the agency use 

existing survey data to identify patterns of deficiency citations and 

at-risk HHAs; specifically, that CMS require surveyors to review all 

available survey data prior to each upcoming survey. CMS noted that 

section 2200A of the “State Operations Manual” requires surveyors to 

review complaint data, previous survey data, and reports generated by 

the Outcome and Assessment Information Set system when preparing 

to conduct an onsite survey. The agency will issue the final version of 

this report to the regional offices and State survey agencies and 

reinforce the necessity of reviewing previous survey data. 

CMS does not concur with the second part of this recommendation: that 

the agency include multiple survey results in the algorithm that 

identifies a targeted sample of HHAs that are at risk of providing poor 

quality of care. CMS suggests that including an algorithm of three 

standard surveys would result in newer HHAs, among others, not being 

included in the targeting process because these HHAs lack historical 

survey data. We excluded HHAs that did not meet the study criteria in 

order to determine clearly the relationship between repeat deficiencies 

and subsequent survey performance. However, CMS would not need to 

exclude any HHAs when using an algorithm that makes use of 

historical data. CMS could modify the algorithm to include any 

available historical survey data that have been weighted, as 

appropriate. HHAs with fewer than four surveys included in OSCAR 

would be assessed based on the survey data that are available. Our 

analysis demonstrates that historical data can improve CMS’s ability to 

identify at-risk HHAs. CMS should use all available data to target 

those HHAs most at risk of providing poor quality of care. 

As an alternative to modifying the algorithm to include historical survey 

data, CMS could conduct analysis similar to that described in this 

report to identify HHAs with repeated deficiencies across multiple 

surveys. CMS could provide this information to State survey agencies 

annually to help surveyors identify HHAs that may be in need of closer 

review, whether or not they appear in the targeted sample. 

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EXECUTIVE SUMMARY 

CMS concurred with the recommendation to implement intermediate 

sanctions as directed by the OBRA 1987. The agency indicated that 

changes in law and other regulations, together with the demands of 

additional improvement efforts, have impeded promulgation of the final 

rule. CMS outlined several initiatives it has undertaken during this 

time to address HHA performance and compliance. 

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Δ TABLE OF CONTENTS 

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

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

FINDINGS ................................................. 9 

Fifteen percent of HHAs repeated the same deficiency citation 

on three consecutive surveys .............................. 9 

CMS oversight of HHAs could be improved .................. 11 
 

RECOMMENDATIONS ..................................... 14 
 

Agency Comments and Office of Inspector General Response . . . 15 

APPENDIXES ............................................. 17 
 

A: Medicare HHA Conditions of Participation and Standards. . . 17 

B: HHA Survey Cycles Prior to Fiscal Year 2006 ............. 21 
 

C: CMS’s Algorithm to Identify Targeted Sample of 

 At-Risk HHAs ...................................... 22 
 

D: Standard-Level Deficiency Citations That Account for 

 Half of All Deficiencies Across the Three Most Recent 

 Surveys for Cyclically Deficient HHAs ................... 23 
 

E: Metropolitan Statistical Areas With High Numbers 

 of Cyclically Deficient HHAs........................... 24 
 

F: Agency Comments ................................... 25 
 

ACKNOWLEDGMENTS .................................... 29 
 
 

INTRODUCTION 

 

 

Δ INTRODUCTION 

OBJECTIVE 

To determine: 

1.	 the extent to which Medicare home health agencies (HHA) 

repeated the same deficiency citations across three consecutive 

surveys, and 

2.	 whether the Centers for Medicare & Medicaid Services (CMS) 

uses deficiency history in its oversight of HHAs. 

BACKGROUND 

Medicare Home Health Benefit and Medicare Expenditures 

Medicare’s home health benefit provides treatment for beneficiaries who 

have short- or long-term illnesses or injuries and who are confined to 

their homes.1 Home health care is intended to reduce the need for 

hospitalization and institutionalization and to help beneficiaries 

maintain their independence and quality of life. To qualify for home 

health services, a Medicare beneficiary must be homebound, be under 

an established plan of care by a physician, and need at least one home 

health therapeutic service or intermittent skilled nursing service 

(e.g., intravenous or intramuscular injections, intravenous feedings).2 

Services provided by a Medicare HHA include skilled nursing services, 

therapeutic services (physical and occupational therapy and 

speech-language pathology), home health aide services, medical social 

services, and certain medical supplies and equipment.3 These services 

are provided by the HHA or are provided under arrangements made by 

the HHA, and they must be ordered and periodically reviewed by a 

physician. In addition, HHAs must maintain patient clinical records 

and be licensed pursuant to State and local law. By the end of 2006, 

there were approximately 8,800 Medicare-certified HHAs nationally.4 

In recent years, the number of Medicare beneficiaries receiving home 

health services has grown along with expenditures for those services. 

From 2001 to 2005, the number of Medicare beneficiaries served by 

HHAs increased 23 percent. In 2005, HHAs provided services to almost 

1 Social Security Act ' 1835(a), 42 U.S.C. ' 1395n(a) (defining the term “confined to his 

home”). 

2 42 CFR § 409.42. 

3 Social Security Act ' 1861(m), 42 U.S.C. § 1395x(m). 

4 CMS Online Survey Certification and Reporting (OSCAR) System as of January 12, 2007. 

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INTRODUCTION 

3 million Medicare beneficiaries who averaged 31 visits per person.5 

Expenditures for home health services increased almost 50 percent from 

$8.6 billion in 2001 to $12.8 billion in 2005. 

HHA Conditions of Participation 

All HHAs participating in the Medicare program must be compliant 

with 15 Medicare Conditions of Participation (CoP) and 69 standards. 6 

The CoP are intended to ensure the quality of services provided by 

HHAs. The 15 HHA Medicare CoP fall into two areas: administration 

and furnishing of services. Twelve of the fifteen CoP are subdivided into 

standards, which address specific aspects of the condition. For example, 

the condition for clinical records includes standards that address the 

retention of records, the protection of records, record reviews, and 

evaluations of the HHA program. Among the 12 CoP that are 

subdivided, each condition can have from 1 to 23 standards. Three CoP 

are not subdivided by standards.7 (See Appendix A for a list of all of the 

HHA CoP and standards.) 

Quality-of-care measures. One HHA condition requires Medicare-certified 

HHAs to report and transmit patient assessment data, within 30 days of 

completing the assessment, using the reporting Outcome and 

Assessment Information Set (OASIS).8 The OASIS is a group of data 

elements collected from each HHA patient used to manage and measure 

each patient’s care and outcomes. For each HHA, CMS uses a subset of 

the OASIS data to calculate a score for 41 quality measures.9 CMS 

provides scores for 12 of the 41 quality measures for each HHA on its 

Home Health Compare Web site.10 These scores are updated quarterly. 

5 CMS Health Care Information System data, 2007. 

6 Social Security Act § 1891(a), 42 U.S.C. § 1395bbb (a); 42 CFR pt. 484 (subparts 

B and C). 

7 The three CoP that are not defined further by standards are: qualifying to furnish 

outpatient physical therapy or speech pathology services 

(42 CFR § 484.38), medical social services (42 CFR § 484.34), and release of patient 

identifiable OASIS information (42 CFR § 484.11). 

8 42 CFR § 484.20. 

9A list of the 41 quality measures can be found at 

http://www.cms.hhs.gov/HomeHealthQualityInits/10_HHQIQualityMeasures.asp#TopOfPage. 

Accessed on April 8, 2008. 

10 CMS, “Information About Home Health Quality Measures.” Available online at 

http://www.medicare.gov/HHCompare/Home.asp?dest=NAV|Home|DataDetails#TabTop. 

Accessed on February 26, 2008. 

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INTRODUCTION 

HHA Survey Process 

HHA certification and recertification surveys. Pursuant to section 1891(b) of 

the Social Security Act, CMS is responsible for ensuring that the HHA 

CoP and their enforcement are adequate to protect the health and 

safety of individuals receiving home health services. To fulfill this duty, 

CMS contracts with State agencies to conduct initial HHA certification 

and recertification surveys (hereinafter referred to as surveys) to 

determine CoP compliance.11 The State agency also may conduct a 

survey at any time in response to complaints from HHA patients or 

other sources. 

During surveys, State agency surveyors (hereinafter referred to as 

surveyors) assess compliance with 7 of the 15 HHA CoP and the 

individual standards that fall within each, plus one additional HHA 

standard.12 13 CMS selected these seven CoP and one additional 

standard because they are associated most closely with patient care. 

The seven HHA CoP and one standard are: 

1.	 42 CFR § 484.10 Condition of Participation: Patient Rights 

2.	 42 CFR § 484.11 Condition of Participation: Release of Patient 

Identifiable OASIS Information 

3.	 42 CFR § 484.12 Condition of Participation: Compliance with 

Federal, State, and Local Laws, Disclosure and Ownership 

Information, and Accepted Professional Standards and Principles 

4.	 42 CFR § 484.18 Condition of Participation: Acceptance of 

Patients, Plan of Care, and Medical Supervision 

5.	 42 CFR § 484.36 Condition of Participation: Home Health 

Aide Services 

6.	 42 CFR § 484.48 Condition of Participation: Clinical Records 

11 Social Security Act ' 1864(a), 42 U.S.C. § 1395aa (a). 

12 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2196.1A (rev. 1, 

May 21, 2004). 

13 An HHA may choose initial certification through one of three approved accrediting 

organizations with deeming authority–the Joint Commission on Accreditation of Healthcare 

Organizations, the Community Health Accreditation Program, and the Accreditation 

Commission for Healthcare. HHAs also may elect to be accredited and surveyed by one of the 

accrediting organizations. CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2210B 

(rev.1, May 21, 2004) and ch. 1, § 1018D (rev. 1, May 21, 2004). Recently, CMS approved 

deeming authority for the Accreditation Commission for Healthcare. 71 Fed. Reg. 9564 

(Feb. 24, 2006). 

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INTROD U C T U C T I O N I O N 

7.	 42 CFR § 484.55 Condition of Participation: Comprehensive 

Assessment of Patients 

8.	 42 CFR § 484.14(g) Coordination of Patient Services (Standard) 

To assess those standards relating to patient care, surveyors review a 

case-mix stratified sample of clinical records and then conduct home 

visits for patients receiving HHA services.14 According to CMS policy, 

the number of record reviews and home visits varies based on the total 

number of unduplicated admissions requiring skilled services within a 

recent 12-month period.15 For example, an HHA that served between 

150 and 750 patients within a 12-month period will have a minimum of 

five to seven record reviews with home visits. In addition, the same 

HHA will receive 10 record reviews without a home visit.16 Surveyors 

also conduct several record reviews with and without home visits for 

patients who each experienced an adverse event outcome (e.g., emergent 

care for an injury caused by a fall or accident at home).17 

If an HHA has one or more standard-level or condition-level 

deficiencies, it is out of compliance and the surveyor provides the HHA 

with a Statement of Deficiencies and Plan of Correction form (Form 

CMS-2567) that includes evidence to support the deficiency citation.18 

The HHA must respond with a plan of correction within 10 calendar 

days of receiving the form.19 An HHA with standard-level deficiencies is 

certified as in compliance by the State agency if the facility submits an 

acceptable plan of correction for achieving compliance within a 

reasonable period of time, which is generally no longer than 60 days 

after notification of the deficiencies.20 An HHA with one or more 

condition-level deficiencies is considered to be providing substandard 

care and cannot be certified as in compliance by the State agency based 

solely on a plan of correction.21 In these cases, the HHA is placed on a 

90-day termination track and is required to submit a “credible 

14 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2200C4 (rev. 1, May 21, 2004). 

15 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2200C5 (rev. 1, May 21, 2004). 

16 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2200C6 (rev. 1, May 21, 2004). 

17 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, §§ 2200C5 and 2200C6 (rev. 1, 

May 21, 2004). 

18 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, §§ 2728 - 2728A (rev. 1, 

May 21, 2004). 

19 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, §' 2728 and 2728B (rev. 1, 

May 21, 2004). 

20 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2728B (rev. 1, May 21, 2004). 

21 CMS “State Operations Manual,” Pub. No. 100-07, ch. 3, § 3012 (rev. 1, May 21, 2004). 

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INTRODUCTION 

allegation of compliance” before the State agency conducts at least one 

revisit to determine whether compliance or acceptable progress has 

been achieved.22 23 

Provisions in the Omnibus Budget Reconciliation Act of 1987 (OBRA 

1987) directed CMS to implement intermediate sanctions against HHAs 

that are no longer in compliance with Federal requirements.24 The 

Secretary of the Department of Health and Human Services was 

directed to develop and implement intermediate sanctions no later than 

April 1, 1989, which were to include civil money penalties, suspension of 

Medicare payments, and the appointment of temporary managers to 

problem HHAs.25 CMS proposed intermediate sanctions in 1991 but 

never finalized the regulation.26 As a result, the only remedy currently 

available to CMS in response to HHA noncompliance is termination. 

Survey frequency. As mandated in statute, an HHA is subject to a 

recertification survey no later than 36 months from the previous 

recertification survey.27 Prior to fiscal year 2006, an HHA’s survey 

frequency could vary from every 12 months to every 36 months depending 

on the HHA’s survey results.28 For example, a new HHA was subject to a 

survey every 12 months for the first 3 years. If the HHA was 

deficiency-free for those 3 years, then it was placed on a 36-month survey 

schedule unless it received any deficiency citations on a subsequent 

survey. In addition to conducting routine scheduled surveys, State 

agencies annually selected and surveyed a 5-percent random sample of 

HHAs on the 36-month survey cycle.29 (See Appendix B for further 

information on variable survey cycles prior to fiscal year 2006.) 

22 Ibid. When an immediate jeopardy to patient health and safety is documented, the State 

agency will initiate a 23-day termination track. CMS “State Operations Manual,” 

Pub. No. 100-07, ch. 3, § 3010B (rev. 1, May 21, 2004). 

23 “Credible allegation of compliance” is defined as “a statement or documentation: that is 

realistic in terms of the possibility of corrective action being accomplished between the exit 

conference and the date of allegation; and that indicates resolution of the problems.” CMS 

“State Operations Manual,” Pub. No. 100-07, ch. 3, § 3016A (rev. 1, May 21, 2004). 

24 OBRRA of 1987, P.L. No. 100-203 ' 4023, Social Security Act ' 1891(e)–(f), 

 42 U.S.C. 1395bbb (e)–(f). 

25 Social Security Act § 1891(f)(1). 

26 56 Fed. Reg. 37054 (Aug. 2, 1991). 

27 Social Security Act § 1891(c)(2)(A). A recertification survey is a “standard survey” as it is 

referred to in the statute. 

28 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195 (rev. 1, May 21, 2004). 

29 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195.E (rev. 1, May 21, 2004). 

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INTROD U C T I O N 

Since fiscal year 2006, CMS simplified its variable survey cycle with a 

new system.30 Instead of being subjected to variable survey cycles, all 

HHAs now are subject to recertification surveys at least once every 

36 months. In addition to these surveys, CMS uses a 5-percent targeted 

sample that replaced the annual 5-percent random sample. The 

targeted sample is generated by an algorithm that identifies HHAs at 

greatest risk of failing to provide quality care. (See Appendix C for 

further information on the algorithm.) CMS indicates that it is using 

targeted sampling to utilize limited Medicare resources more 

effectively.31 Also, CMS no longer requires State agencies to survey 

HHAs 12 months after the initial certification survey. 

OEI-09-06-00040 

METHODOLOGY 

Scope 

As of January 11, 2007, CMS’s OSCAR contained records for 18,731 

Medicare-certified HHAs. OSCAR maintains survey deficiency 

information for the four most recent surveys. To limit our analysis to 

active HHAs, we excluded 9,908 HHAs with termination dates. Also, 

we excluded 157 HHAs with deemed status because the State agency 

does not conduct routine recertification surveys on these HHAs. 

Deemed status is received when an HHA chooses certification through 

an approved accreditation organization. After we excluded deemed 

HHAs and those with termination dates, 8,666 active Medicare-certified 

HHAs remained in our study population. 

Analysis 

In this report, we refer to HHAs that have at least one deficiency 

citation repeated on three consecutive surveys as cyclically deficient. 

For the purpose of describing our methodology, we refer to the four 

surveys in OSCAR numerically as 1, 2, 3, and 4 – Survey 1 being the 

most recent survey conducted of that HHA and Survey 4 being the 

oldest survey in OSCAR. 

30 CMS, Division of Survey and Certification, “Quality Assurance for the Medicare 

& Medicaid Programs, FY 2006 Mission & Priority Document,” August 5, 2005. Through 

2008, CMS continues to apply this new system. CMS, Division of Survey and Certification, 

“Quality Assurance for the Medicare & Medicaid Programs, FY 2008 Mission & Priority 

Document,” August 8, 2007. 

31 Ibid. 

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INTRODUCTION 

For each of the two findings in this report, we analyzed data for a 

different subset of HHAs as shown in Table 1 below. We identified 

cyclically deficient HHAs for each subset. 

Table 1. Subsets of HHAs in the Report 

Type of HHA Subset 

Number of Active 

Medicare-Certified HHAs 

At Least One 

Deficiency Repeated 

on Survey 1, 2, and 3 

At Least One 

Deficiency Repeated on 

Survey 2, 3, and 4 

HHAs with three or four surveys 

(Subset used for the first finding.) 5,661 873 

HHAs with four surveys 

(Subset used for the second finding.) 5,011 655 

Source: Office of Inspector General analysis of CMS survey data, 2008 

To determine the current extent of cyclical deficiency among 

Medicare-certified HHAs for the first finding, we analyzed OSCAR 

results from Surveys 1, 2, and 3 (i.e., the three most recent surveys). Of 

the 8,666 active Medicare-certified HHAs in OSCAR, we excluded 

3,005 HHAs that did not have at least three consecutive surveys with at 

most 42 months between surveys or did not have surveys within 

42 months of January 11, 2007.32 We chose 42 months, which includes 

the 36-month survey cycle and up to 6 months for the State agency to 

complete the survey, as the maximum amount of time between 

surveys.33 From the remaining 5,661 HHAs, we identified 873 HHAs 

that each had at least one condition- or standard-level deficiency 

citation repeated on Survey 1, 2, and 3. 

As part of the second finding, to determine how cyclically deficient 

HHAs performed on the subsequent survey, we identified each HHA 

that had at least one deficiency repeated on Survey 2, 3, and 4 

(i.e., cyclically deficient on the three consecutive surveys prior to the 

most recent survey). We then compared the survey performance on 

Survey 1 (the most recent survey) of these cyclically deficient HHAs to 

all other HHAs. Of the 8,666 active Medicare-certified HHAs in 

OSCAR, we excluded 3,655 HHAs that did not have four consecutive 

surveys with at most 42 months between surveys or did not have 

32 We contacted CMS’s Region V office to determine why some HHAs had current surveys 

longer than 3 years ago. The regional office indicated that either the HHA had deemed status 

or the State agencies had not entered the most recent survey results into OSCAR. 

33 Currently, there is no CMS guidance regarding timely uploading of survey results into 

OSCAR. 

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INTRODUCTION 

surveys within 42 months of January 11, 2007. From the remaining 

5,011 HHAs, we identified 655 HHAs that each had at least one 

condition- or standard-level deficiency citation repeated on Surveys 2, 3, 

and 4. To determine the use of deficiency history in the oversight of 

HHAs, these HHAs also were used in an analysis with CMS’s 5-percent 

targeted sample for fiscal year 2006. 

In addition, we conducted structured interviews with staff from CMS’s 

Survey and Certification Group and surveyors from CMS’s regional 

offices and State agencies. We also visited several HHAs to gather 

information about the survey process and HHA operations. 

Limitations 

Our study is limited to the information in OSCAR. This study did not 

assess the survey process or the accuracy of CMS data in OSCAR. 

Standards 

This study was conducted in accordance with the “Quality Standards for 

Inspections” issued by the President’s Council on Integrity and 

Efficiency and the Executive Council on Integrity and Efficiency. 

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FINDINGS Δ FINDINGS 

As of January 11, 2007, 873 HHAs 

(15 percent) repeated at least 

Fifteen percent of HHAs repeated the same 

deficiency citation on three consecutive surveys 

one deficiency citation on each of 

their three most recent surveys. Many cyclically deficient HHAs 

repeated more than one deficiency citation across multiple surveys. Of 

the 873 cyclically deficient HHAs, 366 (42 percent) repeated at least two 

of the same citations on each of their three most recent surveys, and 

47 (5 percent) repeated the same five or more citations. Most cyclically 

deficient HHAs repeated standard-level citations; only six HHAs had a 

condition-level deficiency repeated on each of their three most recent 

surveys. 

The most frequently repeated deficiency citation is related to patient plans 

of care 

The 10 most frequently repeated deficiency citations, among cyclically 

deficient HHAs, are standard-level deficiencies and account for 

79 percent of all repeated citations. (See Table 2 on the next page for a 

list of the top 10 deficiencies.) 

Four of the ten deficiencies (G158, G159, G164, and G165) are 

associated with standards in the acceptance of patients, plan of care, 

and medical supervision condition.34 These four deficiency citations 

account for 48 percent of all repeated citations among cyclically deficient 

HHAs. Of 873 cyclically deficient HHAs, 404 (46 percent) received a 

repeated citation for not demonstrating that the written plan of care 

was reviewed by the patient’s physician (G158). The other three 

deficiency citations show that the written plan of care did not cover 

pertinent diagnoses (G159), the agency staff did not alert the physician 

of changes in the patient’s condition (G164), and the agency staff did not 

administer drugs or treatments as ordered by the physician (G165). 

34 Each standard and condition is affiliated with a specific G tag (e.g., G158). CMS uses 

G tags to identify deficiencies on the Statement of Deficiencies and Plan of Correction form. 

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FINDINGS 

Table 2. The 10 Most Frequently Repeated Standard- and Condition-Level Deficiency Citations 

 Among Cyclically Deficient HHAs 

Percentage of 

All 1,662 Of the 873 Cyclically 

Repeated Deficient HHAs, Number 

Deficiency of HHAs That Repeated 

Standard-Level Deficiency Citation* (associated condition) (G tag) Citations the Citation** 

1. Written plan of care established and periodically reviewed by a doctor. (Acceptance of 24.3% 404 patients, plan of care, and medical supervision.) (G158) 

2. Plan of care covers all pertinent diagnoses. (Acceptance of patients, plan of care, and 15.3% 255 medical supervision.) (G159) 

3. Clinical record maintained in accordance with accepted professional standards. 12.6% 209 (Clinical records.) (G236) 

4. The comprehensive assessment must include a review of all medications the patient is 8.5% 141 currently taking. (Comprehensive assessment of patients.) (G337) 

5. Agency professional staff promptly alerts the physician to any changes in the patient’s 5.2% 86 condition. (Acceptance of patients, plan of care, and medical supervision.) (G164) 

6. Drugs and treatments are administered by agency staff only as ordered by the 3.0% 50 physician. (Acceptance of patients, plan of care, and medical supervision.) (G165) 

7. All personnel furnishing services maintain liaison to ensure that their efforts are 

coordinated effectively and support the objectives outlined in the plan of care. 2.9% 49 

(Organization, services, and administration.) (G143) 

8. Registered nurse regularly reevaluates the patient’s nursing needs. (Skilled nursing 2.5% 41 services.) (G172) 

9. Registered nurse (or another professional described in paragraph (d)(1) of this section) 

must make an onsite visit to the patient’s home no less frequently than every 2 weeks. 2.5% 41 

(Home health aide services.) (G229) 

10. A written summary report for each patient is sent to the attending physician at least 2.4% 40 every 60 days. (Organization, services, and administration.) (G145) 

 Total 79.2%

 Source: Office of Inspector General analysis of CMS survey data, 2007. 

*For complete descriptions, refer to CMS’s “State Operations Manual,” Pub. No. 100-07, Appendix B (rev. 11, August 12, 2005). 

**The column “Of the 873 Cyclically Deficient HHAs, Number of HHAs That Repeated the Citation” does not sum to 873 because HHAs may be cited for more than 

one deficiency. 

Cyclically deficient HHAs received twice as many deficiency citations 

On the three most recent surveys, cyclically deficient HHAs received, on 

average, 11.3 deficiency citations per survey compared to 5.7 citations 

for those HHAs that did not repeat citations. The most frequently cited 

deficiency citations across the three surveys are similar for cyclically 

deficient HHAs and those HHAs that did not repeat citations. (See 

Appendix D for a list of standard-level deficiencies that account for half 

of all deficiencies across the three most recent surveys for cyclically 

deficient HHAs.) 

Cyclically deficient HHAs are concentrated in several States 

Of the cyclically deficient HHAs, 64 percent (556 of 873) are located in 

six States – California, Florida, Illinois, Iowa, Michigan, and Texas. 

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F I NDING S 

However, only 30 percent of all HHAs in our study population are from 

these six States. In California, Illinois, and Michigan, more than half of 

HHAs are cyclically deficient. Highly populated areas within five of the 

six States (except Iowa) contain a greater percentage of cyclically 

deficient HHAs compared to the rest of the State. For example, three 

metropolitan areas in California contain 76 percent (61 of 80) of 

cyclically deficient HHAs in the State.35 Approximately 68 percent of all 

HHAs in California are in these three metropolitan areas. One 

metropolitan area in Illinois contains 74 percent (117 of 159) of 

cyclically deficient HHAs in the State, whereas only 55 percent of HHAs 

in Illinois are in this metropolitan area. (See Appendix E for the 

distribution of cyclically deficient HHAs in the States mentioned above.) 

CMS conducts surveys as part of CMS oversight of HHAs could be improved its oversight of HHAs. Currently, 

State agencies conduct recertification surveys at least once every 

36 months for each HHA. In addition, State agencies annually conduct 

surveys of a 5-percent targeted sample of at-risk HHAs. Prior to each 

survey, surveyors are required to review previous survey data in 

addition to outcome reports and complaint data.36 However, surveyors 

are not required to review all past survey data in OSCAR. We found 

that deficiency history, beyond the most recent survey, can be an 

important indicator of performance on the next survey. 

Cyclically deficient HHAs performed worse on the next survey than 

other HHAs 

We identified 655 cyclically deficient HHAs that repeated at least one 

deficiency on the three consecutive surveys prior to the most recent 

survey. Chart 1 on the next page shows that they went on to receive 

more deficiencies, on average, than other HHAs on the most recent 

survey. This difference was more pronounced among HHAs with at 

least six deficiencies on the prior survey. 

35 A “metropolitan area” refers to a metropolitan statistical area as defined by the Office of 

Management and Budget and based on U.S. Census Bureau data. A metropolitan area has at 

least one urbanized area with a population of 50,000 or more. 

36 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2200A (rev. 1, May 21, 2004). 

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FINDINGS 

Chart 1. Cyclically Deficient HHAs, on Average, Received More 

 Deficiencies on the Next Survey Than Other HHAs 

n=481 

n=364 

n=291 

n=3,875 

0 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

0 to 5 6 or more 

Number of deficiencies on the prior survey 

Average number of deficiencies on the

most recent survey 

Cyclically Deficient All other HHAs 

Source: Office of Inspector General analysis of CMS survey data, 2008. 

Cyclically deficient HHAs performed worse on the next survey than 

at-risk HHAs without a history of cyclical deficiencies 

Although CMS’s algorithm identifies at-risk HHAs, it can target HHAs 

better by including deficiency history information such as repeated 

deficiency citations. As shown in Chart 2 on the next page, cyclically 

deficient HHAs that were not identified as at-risk by CMS’s algorithm 

for fiscal year 2006 received, on average, 6.9 deficiencies on their most 

recent survey. This is greater than the average of 3.7 deficiencies 

among at-risk HHAs without a history of cyclical deficiencies.37 

 OEI-09-06-00040 

37 We excluded 33 HHAs for which the prior survey (Survey 2) occurred after 

October 1, 2005, because information about cyclical deficiencies would not have been available 

when CMS identified at-risk HHAs for fiscal year 2006. We also excluded 

2,711 HHAs for which the most recent survey (Survey 1) occurred before October 1, 2005, 

because we wanted to limit this analysis to HHAs for which performance on the most recent 

survey was unknown at the time CMS identified at-risk HHAs for fiscal year 2006. 

DEFICIENCY HISTORY AND RECERTIFICATION OF MEDICARE H OME HEALTH A GENCIES 12 
 

 

F I NDING S 

Chart 2. Cyclically Deficient HHAs Performed Worse Among Both 

At-Risk HHAs and Not At-Risk HHAs 

n=260 

0 

1 

2 

3 

4 

5 

6 

7 

8 

9 

CMS fiscal year 2006 at-risk group Not in at-risk group 

Average number of deficiencies on the

most recent survey 

Cyclically Deficient All Other HHAs 

n=92 

n=189 

n=1,726 

Source: Office of Inspector General analysis of CMS survey data, 2008. 

CMS’s sanction options for HHAs with deficiency citations are limited 

For HHAs with one or more condition-level deficiencies, CMS has no 

sanction other than initiating a termination track. An HHA that 

receives one or more condition-level deficiencies is required to submit a 

plan of correction and is subject to at least one revisit by the State 

agency to determine whether compliance has been achieved. An HHA 

that receives only standard-level deficiencies is required to submit an 

acceptable plan of correction before being certified as in compliance. 

Although provisions in the OBRA 1987 directed CMS to implement 

intermediate sanctions for HHAs that failed to correct deficiencies, CMS 

did not finalize the regulation. Therefore, termination from the 

Medicare program remains the only Federal sanction for HHAs with 

deficiency citations, and it is used only rarely. In 2006, there were only 

21 involuntary HHA terminations. 

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FINDINGS Δ RECOMMENDATIONS 

An analysis of HHA deficiency history data shows that 15 percent of 

HHAs are cyclically deficient. Furthermore, HHAs with repeated 

deficiencies perform worse on subsequent surveys. However, CMS does 

not use deficiency history in its oversight of HHAs. Also, for HHAs with 

one or more condition-level deficiencies, CMS has no sanction other 

than initiating a termination track. Based on our findings, we 

recommend that CMS: 

Use Existing Survey Data To Identify Patterns of Deficiency Citations and 

At-Risk HHAs 

CMS should require surveyors to review all available survey data prior 

to each upcoming survey. Because CMS uses the number of deficiencies 

as an element to identify at-risk HHAs, cyclically deficient HHAs could 

be considered at risk because they generally receive more citations. 

Identifying repeat deficiency areas could help surveyors and HHAs 

identify areas for improvement. In addition, CMS could focus efforts on 

those States with large numbers of cyclically deficient HHAs. 

CMS should include multiple survey results in its algorithm that 

identifies the targeted sample of HHAs that are at risk of providing poor 

quality of care. Because HHAs with a history of cyclical deficiencies 

perform worse on subsequent surveys, deficiency history can be an 

important indicator of future performance. Currently, the algorithm 

does not include results from surveys conducted prior to the most recent 

survey. As a result, CMS and surveyors may miss HHAs in need of 

more frequent review. CMS could incorporate prior survey data from 

OSCAR into the algorithm. 

Implement Intermediate Sanctions as Directed by the OBRA 1987 

Currently, termination from the Medicare program is the only sanction 

for poorly performing HHAs. We found that the most frequently cited 

deficiency for cyclically deficient HHAs identify problems related to 

patient plans of care. In some cases, termination may be the 

appropriate action. However, less severe sanction options could be 

effective in addressing performance problems that do not immediately 

jeopardize patient health and safety. Options for additional sanctions 

may include civil money penalties, suspension of all or part of Medicare 

payments, and appointment of temporary management for cyclically 

deficient HHAs. 

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RECOMMENDATIONS 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

CMS generally concurred with our recommendations. CMS indicated 

that during the last several years, it has implemented improvements to 

the oversight of HHAs, many of which address the issue of repeated 

deficiencies. These changes include: (1) oversight of branch locations, 

(2) the addition of new OASIS reports, (3) increased training of 

surveyors, (4) identification of a targeted sample of HHAs, and (5) the 

development of a State Performance Standards System. 

CMS concurred, in part, with the recommendation that the agency use 

existing survey data to identify patterns of deficiency citations and 

at-risk HHAs; specifically, that CMS should require surveyors to review 

all available survey data prior to each upcoming survey. CMS notes 

that section 2200A of the “State Operations Manual” requires surveyors 

to review complaint data, previous survey data, and reports generated 

by the OASIS system when preparing to conduct an onsite survey. The 

agency will issue the final version of this report to the regional offices 

and State survey agencies and reinforce the necessity of reviewing 

previous survey data. We recommend that CMS specifically instruct 

surveyors to review data beyond the most recent survey and to highlight 

patterns of noncompliance such as repeat deficiencies across multiple 

surveys. 

CMS does not concur with the second part of this recommendation: that 

the agency include multiple survey results in the algorithm that 

identifies a targeted sample of HHAs that are at risk of providing poor 

quality of care. CMS suggests that including an algorithm of three 

standard surveys would result in newer HHAs, among others, not being 

included in the targeting process because these HHAs lack historical 

survey data. We excluded HHAs that did not meet the study criteria in 

order to determine clearly the relationship between repeat deficiencies 

and subsequent survey performance. However, CMS would not need to 

exclude any HHAs when using an algorithm that makes use of 

historical data. CMS could modify the algorithm to include any 

available historical survey data that have been weighted, as 

appropriate. HHAs with fewer than four surveys included in OSCAR 

would be assessed based on the survey data that are available. Our 

analysis demonstrates that historical data can improve CMS’s ability to 

identify at-risk HHAs. CMS should use all available data to target 

those HHAs most at risk of providing poor quality of care. 

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RECOMMENDATIONS 

As an alternative to modifying the algorithm to include historical survey 

data, CMS could conduct analysis similar to that described in this 

report to identify HHAs with repeated deficiencies across multiple 

surveys. CMS could provide this information to State survey agencies 

annually to help surveyors identify HHAs that may be in need of closer 

review, whether or not they appear in the targeted sample. 

CMS concurred with the recommendation to implement intermediate 

sanctions as directed by the OBRA 1987. The agency indicated that 

changes in law and other regulations, together with the demands of 

additional improvement efforts, have impeded promulgation of the final 

rule. CMS outlined several initiatives it has undertaken during this 

time to address HHA performance and compliance. 

CMS also indicated that one finding not addressed in detail in the 

recommendations may prove useful in targeting HHAs. CMS may rely 

on information that cyclical deficient HHAs are concentrated in six 

States to assist them in targeting future surveys. 

We revised our description of HHAs’ statutorily required survey 

frequency to address CMS’s technical comments. 

The text of CMS’s comments is available in Appendix F. 

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Δ APPENDIX~A 

Medicare HHA Conditions of Participation and Standards 

* Conditions reviewed in all home health agency certification and recertification 

surveys. CMS State Operations Manual, Pub. No. 100-07, ch. 2, § 2196.1A (rev. 1, 

May 21, 2004).
 

** This is a general description of the standard because a title for the standard is not 

provided. 

Administration 

42 CFR § 484.10 Condition of Participation: Patient Rights * 

(a) Standard: Notice of Rights 

(b) Standard: Exercise of Rights and Respect for Property and Person 

(c) Standard: Right to be Informed and to Participate in Planning 

 Care and Treatment 

(d) Standard: Confidentiality of Medical Records 

(e) Standard: Patient Liability for Payment 

(f) Standard: Home Health Hotline 

42 CFR § 484.11 Condition of Participation: Release of Patient 

 Identifiable Outcome and Assessment Information Set (OASIS) 

Information * 

42 CFR § 484.12 Condition of Participation: Compliance with Federal, 	

 State, and Local Laws, Disclosure and Ownership Information, and 

 Accepted Professional Standards and Principles * 

(a) Standard: Compliance with Federal, State, and Local Laws 

 and Regulations 

(b) Standard: Disclosure of Ownership and Management Information 

(c) Standard: Compliance with Accepted Professional Standards 

 and Principles 

42 CFR § 484.14 Condition of Participation: Organization, Services, 	

and Administration 

(a) Standard: Services Furnished 

(b) Standard: Governing Body 

(c) Standard: Administrator 

(d) Standard: Supervising Physician or Registered Nurse 

(e) Standard: Personnel Policies 

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APPENDIX ~ A 

(f) Standard: Personnel Under Hourly or Per Visit Contracts 

(g) Standard: Coordination of Patient Services * 

(h) Standard: Services Under Arrangement 

(i) Standard: Institutional Planning 

(i)(1) Standard: Annual Operating Budget 

(i)(2) Standard: Capital Expenditure Plan 

(i)(3) Standard: Preparation of Plan and Budget 

(i)(4) Standard: Annual Review of Plan and Budget 

(j) Standard: Laboratory Services 

42 CFR § 484.16 Condition of Participation: 	Group of Professional 

Personnel 

(a) Standard: Advisory and Evaluation Function 

42 CFR § 484.18 Condition of Participation: Acceptance of Patients, 	

Plan of Care, and Medical Supervision * 

(a) Standard: Plan of Care 

(b) Standard: Periodic Review of Plan of Care 

(c) Standard: Conformance with Physician Orders 

42 CFR § 484.20 Condition of Participation: Reporting OASIS Information 

(a) Standard: Encoding OASIS Data 

(b) Standard: Accuracy of Encoded OASIS Data 

(c) Standard: Transmittal of OASIS Data 

(d) Standard: Data Format 

Furnishing of Services 

42 CFR § 484.30 Condition of Participation: Skilled Nursing Services 

(a) Standard: Duties of the Registered Nurse 

(b) Standard: Duties of the Licensed Practical Nurse 

42 CFR § 484.32 Condition of Participation: Therapy Services 

(a) Standard: Supervision of Physical Therapy Assistant and 

Occupational Therapy Assistant 

(b) Standard: Supervision of Speech Therapy Services 

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A P P E N D I X ~ A 

42 CFR § 484.34 Condition of Participation: Medical Social Services 

42 CFR § 484.36 Condition of Participation: Home Health Aide Services * 

(a) Standard: Home Health Aide Training 

(a)(1) Standard: Content and Duration of Training 

(a)(2) Standard: Conduct of Training 

(a)(3) Standard: Documentation of Training 

(b) Standard: Competency Evaluation and In-Service Training 

(b)(1) Standard: Applicability 

(b)(2) Standard: Content and Frequency of Evaluations and

 Amount of In-Service Training 

(b)(3) Standard: Conduct of Evaluation and Training 

(b)(4) Standard: Competency Determination 

(b)(5) Standard: Documentation of Competency Evaluation 

(b)(6) Standard: Effective Date 

(c) Standard: Assignment and Duties of the Home Health Aide 

(c)(1) Standard: Assignment 

(c)(2) Standard: Duties 

(d) Standard: Supervision 

(d)(1) Standard: Supervisory Visit ** 

(d)(2) Standard: On-site Visit for Patients Receiving Skilled 

Nursing Care ** 

(d)(3) Standard: On-site Visit for Patients Not Receiving Skilled 

Nursing or Rehabilitation Therapy Services ** 

(d)(4) Standard: Home Health Aide Services Not Provided by an 

Employee of the Agency ** 

(d)(4)(i) Standard: Ensuring Overall Quality of Care Provided 

by Aide ** 

(d)(4)(ii) Standard: Supervision of Aide’s Services ** 

(d)(4)(iii) Standard: Ensuring Home Health Aides Meet 

Training Requirements ** 

(e) Standard: Personal Care Attendant: Evaluation Requirements 

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APPENDIX~A 

42 CFR § 484.38 Condition of Participation: Qualifying to Furnish 

 Outpatient Physical Therapy or Speech Pathology Services 

42 CFR § 484.48 Condition of Participation: Clinical Records * 

(a) Standard: Retention of Records 

(b) Standard: Protection of Records 

42 CFR § 484.52 Condition of Participation: Evaluation of the Agency's 	

Program 

(a) Standard: Policy and Administrative Review 

(b) Standard: Clinical Record Review 

42 CFR § 484.55 Condition of Participation: Comprehensive 	

Assessment of Patients * 

(a) Standard: Initial Assessment Visit 

(a)(1) Standard: Determine Immediate Care and Support and 

Medicare Eligibility ** 

(a)(2) Standard: Visit by Rehabilitation Skilled Professional ** 

(b) Standard: Completion of the Comprehensive Assessment 

(c) Standard: Drug Regimen Review 

(d) Standard: Update of the Comprehensive Assessment 

(e) Standard: Incorporation of OASIS Data Items 

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Δ APPENDIX~B 

 OEI-09-06-00040 

HHA Survey Cycles Prior to Fiscal Year 2006 

Prior to fiscal year 2006, the Centers for Medicare & Medicaid Services 

(CMS) assigned home health agencies (HHA) a survey frequency based 

on their most recent survey performance.38 Surveyors generally 

conducted unannounced recertification surveys every 12 to 36 months 

based on their Medicare enrollment and survey history.39 In addition to 

conducting routine surveys, State agencies annually selected a 

5-percent random sample of HHAs on the 36-month survey cycle. This 

random sample of HHAs received a recertification survey within 16 to 

20 months following its last recertification survey.40 

If an HHA was not out of compliance with any Conditions of 

Participation (CoP) during the first 3 years after the HHA opened or 

changed ownership, then the HHA was placed on a 36-month 

recertification survey cycle. An HHA remained on a 36-month 

recertification survey cycle if (1) no condition-level deficiencies were out 

of compliance in any of the previous three recertification surveys; (2) no 

standard-level deficiencies were cited under the acceptance of patients, 

plan of care, and medical supervision condition (42 CFR § 484.18) or the 

comprehensive assessment of patients condition (42 CFR § 484.55) in 

the previous survey; and (3) no complaints resulted in deficiency 

citations since the previous survey.41 

An HHA that failed to meet at least one of the CoP was considered to be 

providing substandard care and required more scrutiny. If the HHA 

came back into compliance, it received a survey within 4 to 6 months 

from the date compliance was established.42 If the HHA maintained 

compliance, then it was placed on a 12-month survey cycle until the 

HHA received no condition-level deficiency citations for at least 

2 consecutive years. 

38 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195 (rev. 1, May 21, 2004). 

39 Beginning in 1999, the time between surveys for most HHAs increased from a range of 

9 to 15 months up to 36 months. 

40 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195.E (rev. 1, May 21, 2004). 

41 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195.A (rev. 1, May 21, 2004). 

42 CMS “State Operations Manual,” Pub. No. 100-07, ch. 2, § 2195.D (rev. 1, May 21, 2004). 

DEFICIENCY HISTORY AND RECERTIFICATION OF MEDICARE H OME HEALTH A GENCIES 21 
 

 

Δ APPENDIX~C 

 OEI-09-06-00040 

CMS’s Algorithm To Identify Targeted Sample of At-Risk HHAs 

To produce the 5-percent targeted sample, the Centers for Medicare & 

Medicaid Services (CMS) now applies an algorithm that identifies 

at-risk home health agencies (HHA) in each State. For each active HHA 

that is not due for a 36-month survey, the algorithm assigns a survey 

priority score that is comprised of the following six data elements: 

1.	 Total number of standard-level deficiencies for the HHA on the 

most recent survey; 

2.	 Total number of condition-level deficiencies for the HHA on the 

most recent survey; 

3.	 Total number of standard-level deficiencies on the most recent 

survey common to closed/terminated HHAs; 

4.	 Total number of risk-adjusted quality improvement outcomes 

(e.g., improvement in upper body dressing) less than a 

calculated threshold value as determined by CMS; 

5.	 Total number of non-risk-adjusted quality improvement 

outcomes (e.g., improvement in cognitive function) less than a 

calculated threshold value as determined by CMS; and 

6.	 Total number of adverse events deemed “worse” than a 

calculated threshold value as determined by CMS.43
 

The algorithm generates a score that CMS uses to identify HHAs that 

are at risk of providing poor quality of care. At the beginning of each 

fiscal year, CMS shares a targeted list with each State agency that is 

comprised of the 10 percent of HHAs that have the highest 

(i.e., worst) scores in the State. Using CMS’s targeted list, State 

agencies then apply their additional knowledge of the HHAs to select 

the final 5-percent targeted sample for survey.44 The 36-month survey 

clock will be reset for HHAs selected for the targeted sample. 

43 University of Colorado at Denver and Health Sciences Center, “Improving Protocols for 

Home Health Agency Assessment in the Survey Process, Appendix E: Survey Priority Score 

Algorithm,” June 2006. 

44 Quality Assurance for the Medicare & Medicaid Programs: FY 2006 Mission & Priority 

Document, CMS, Survey and Certification Group, Center for Medicaid and State Operations, 

p. 11, August 2005. 

DEFICIENCY HISTORY AND RECERTIFICATION OF MEDICARE H OME HEALTH A GENCIES 22 
 

 

Δ APPENDIX~D

Standard-Level Deficiency Citations That Account for Half of All Deficiencies Across the Three Most 

Recent Surveys for Cyclically Deficient HHAs (n=873) 

Percentage of 

Deficiency Citations for 

Cyclically Deficient 

Deficiency Citation (G tag)* HHAs 

1. Care follows a written plan of care established and periodically reviewed by a doctor of medicine, 7.5% osteopathy, or podiatric medicine. (G158) 

2. The plan of care developed in consultation with the agency staff covers all pertinent diagnoses, including 

mental status, types of services and equipment required, frequency of visits, prognosis, rehabilitation 

potential, functional limitations, activities permitted, nutritional requirements, medications and treatment, 6.0% 

any safety measures to protect against injury, instructions for timely discharge or referral, and any other 

appropriate items. (G159) 

3. A clinical record containing pertinent past and current findings in accordance with accepted professional 

standards is maintained for every patient receiving home health services. In addition to the plan of care, 

the record contains appropriate identifying information; name of physician; drug, dietary, treatment, and 5.5% 

activity orders; signed and dated clinical and progress notes; copies of summary reports sent to the 

attending physician; and a discharge summary. (G236) 

4. The comprehensive assessment must include a review of all medications the patient is currently using in 

order to identify any potential adverse effects and drug reactions, including ineffective drug therapy, 3.6% significant side effects, significant drug interactions, duplicate drug therapy, and noncompliance with drug 

therapy. (G337)
 

5. Agency professional staff promptly alerts the physician to any changes that suggest a need to alter the 3.5% plan of care. (G164) 

6. The registered nurse (or another professional described in paragraph (d)(1) of this section) must make 2.9% an onsite visit to the patient’s home no less frequently than every 2 weeks. (G229) 

7. Drugs and treatments are administered by agency staff only as ordered by the physician with the 

exception of influenza and pneumococcal polysaccharide vaccines, which may be administered per 2.7% agency policy developed in consultation with a physician, and after an assessment of considerations. 

(G165) 

8. All personnel furnishing services maintain liaison to ensure that their efforts are coordinated effectively 2.7% and support the objectives outlined in the plan of care. (G143) 

9. A written summary report for each patient is sent to the attending physician at least every 60 days. 2.5% (G145) 

10. Written patient care instructions for the home health aide must be prepared by the registered nurse or 

other appropriate professional who is responsible for the supervision of the home health aide under 2.2% 

paragraph (d) of this section. (G224) 

11. The clinical record or minutes of case conferences establish that effective interchange, reporting, and 2.1% coordination of patient care does occur. (G144) 

12. The HHA and its staff must comply with accepted professional standards and principles that apply to 2.0% professionals furnishing services in a home health agency. (G121) 

13. The registered nurse makes the initial evaluation visit and regularly reevaluates the patient’s nursing 2.0% needs. (G172) 

14. The HHA furnishes skilled nursing services by or under the supervision of a registered nurse and in 1.9% accordance with the plan of care. (G170) 

15. The registered nurse prepares clinical and progress notes, coordinates services, and informs the 1.9% physician and other personnel of changes in the patient’s condition and needs. (G176) 

16. If a physician refers a patient under a plan of care that cannot be completed until after an evaluation visit, 1.5% the physician is consulted to approve additions or modifications to the original plan. (G160) 

 Total 50.5% 

Source: Office of Inspector General analysis of the Centers for Medicare & Medicaid Services survey data, 2007. 

* Each standard and condition is affiliated with a specific G tag (e.g., G158). CMS uses G tags to identify deficiencies on the Statement of Deficiencies and Plan 

of Correction form. 

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Δ APPENDIX~E 

Metropolitan Statistical Areas With High Numbers of Cyclically Deficient HHAs 

State Metropolitan Statistical Area 

Number of HHAs 

With at Least 

One Citation in 

Each of Last 

Three Surveys 

Number of HHAs 

With Repeat 

Citations 

Percentage of HHAs 

With Repeat 

Citations 

CALIFORNIA 

Los Angeles-Long Beach-Santa Ana 46 31 67% 

Riverside-San Bernardino-Ontario 27 12 44% 

San Diego-Carlsbad-San Marcos 19 18 95% 

Rest of CA 43 19 44% 

 State Total 135 80 59% 

FLORIDA 

Cape Coral-Fort Meyers 14 6 43% 

Miami-Fort Lauderdale-Miami Beach 140 15 11% 

Rest of Florida 238 17 7% 

 State Total 392 38 10% 

ILLINOIS 

Chicago-Naperville-Joliet 139 117 84% 

Rest of Illinois 113 42 37% 

 State Total 252 159 63% 

IOWA 

Cedar Rapids 11 4 36% 

Des Moines-West Des Moines 4 3 75% 

Waterloo-Cedar Falls 15 3 20% 

Rest of Iowa 145 49 34% 

 State Total 175 59 34% 

MICHIGAN 

Detroit-Warren-Livonia 51 31 61% 

Rest of Michigan 54 32 59% 

 State Total 105 63 60% 

TEXAS 

Dallas-Fort Worth-Arlington 132 38 29% 

Houston-Sugar Land-Baytown 124 21 17% 

McAllen-Edinburg-Mission 29 11 38% 

San Antonio 68 30 44% 

Rest of Texas 384 57 15% 

 State Total 737 157 21% 

Source: Office of Inspector General analysis of the Centers for Medicare & Medicaid Services survey data, 2007. 

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Δ APPENDIX~F

Agency Comments 

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APPENDIX ~ F 

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APPENDIX ~ F 

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APPENDIX ~ F 

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APPENDIX ~ F Δ ACKNOWLEDGMENTS 

This report was prepared under the direction of Timothy S. Brady, 

Regional Inspector General for Evaluation and Inspections in the 

San Francisco regional office, and Deborah W. Harvey, Deputy Regional 

Inspector General. 

China Tantameng and Camille Harper were coleaders for this study. 

Other Office of Evaluation and Inspections staff from the San Francisco 

regional office who contributed include Scott Hutchison; central office 

staff who contributed include Rob Gibbons and Sandy Khoury. 

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