Medicaid program integrity efforts have been ramping up quickly, and last week we saw clear evidence of this trend when the Ohio Department of Medicaid (ODM) suspended payments to 49 home health providers with billing patterns that the agency deemed suspicious. 

This makes Ohio an early state to take cues from CMS on shifting away from pay-and-chase methodologies and toward more proactive and preventive actions. If other states follow suit, providers in both the Medicare and Medicaid programs will be facing a cascade of more rigorous requirements and intense scrutiny.

Other actions taken by the state’s governor demonstrate how dramatically the Medicaid landscape is shifting. Taking a cue from the Centers for Medicare & Medicaid Services’ (CMS) moratorium on new home health providers, Ohio Governor Mike DeWine, a Republican, asked CMS for permission to implement a six-month moratorium on new home health care and hospice businesses becoming Medicaid providers. The governor has implemented other fraud-focused initiatives as well, including new technological tools to add oversight to providers and working to make GPS mandatory for electronic visit verifications (EVV).

Moreover, Ohio politicians have in recent days pursued another method of cracking down on Medicaid. Policymakers attempted to bring forth a bill banning Medicaid payments to family caregivers – though this latest effort failed to come to fruition.

Taken together, the suspension of 49 providers and the state’s other efforts to reduce fraud create a snapshot of the tensions within Medicaid fraud-fighting and the end of the pay-and-chase Medicaid era.

In this week’s exclusive, members-only HHCN+ Update, I’ll highlight the most meaningful fraud-fighting actions taken in Ohio, offering analysis and key takeaways, including:

– The details of Ohio’s anti-fraud strategy

– Where program integrity efforts start to lose supporters

– What the state’s actions foretell for the rest of the home-based care industry

The Ohio Medicaid fraud saga

The news that prompted me to cast a closer eye on Medicaid actions in Ohio was the suspension of 49 home health providers.

I mentioned several of DeWine’s other actions taken to fight fraud in my initial coverage of those suspensions, but they warrant a deeper dive.

Since the beginning of 2023, Ohio secured 444 Medicaid fraud indictments, 481 convictions and 146 civil settlements and judgments resulting in $78.4 million in recovered taxpayer funds. These are pretty staggering numbers – and the state has definitely ramped up lately, so we can only expect these numbers to balloon.

Firstly, the 49 suspensions aren’t the end of that story. The state plans to pursue more, as enabled by a new executive order from DeWine that allows immediate suspension of Medicaid payments to providers upon a credible allegation of fraud. The state has already identified a further 87 providers that officials say will be subject to further review and potential payment suspension.

The state also plans to file rules requiring GPS for all providers using EVV – which may soon be all providers, as Ohio has been phasing in EVV as a mandatory requirement for home health care provider payments. Family and live-in caregivers are currently exempt from EVV requirements, but Ohio Medicaid plans to begin rulemaking to make EVV mandatory for these groups as well.

Notably, among the state’s anti-fraud efforts, its Medicaid program is pursuing a six-month moratorium on new enrollments in home health and hospice. This was foreshadowed by the national moratorium on new Medicare home health enrollments, under which CMS recommended that states’ Medicaid programs consider their own moratoria.

In an FAQ released alongside the Medicare home health and hospice moratoria announcement, CMS said the following:

“CMS encourages each state to, as appropriate, implement a HHA and hospice provider moratorium tailored to the specifics of their beneficiary population, as well as any geographic considerations,” the FAQ read. “Additionally, CMS is offering every state and territory the opportunity to consult with CMS on the prospect of implementing a Medicaid-based, CHIP-based, or a Medicaid and CHIP-based HHA and/or Hospice moratorium in their jurisdictions.”

It seems DeWine took that suggestion seriously and is now pursuing such a ban, looking to consult CMS.

When anti-fraud efforts go too far

Ohio is clearly not messing around when it comes to Medicaid program integrity, but the governor has been at the helm of these initiatives. Among Ohio policymakers, there is no complete consensus on how to fight Medicaid fraud.

Several local news outlets reported that on Monday, Ohio Republicans removed a controversial provision from Ohio House Bill 795 – the ban on Medicaid payments for paid family caregivers. After advocates testified against the ban, Republicans removed it. 

Support for programs to pay family caregivers varies.  Leaders at the highest levels of the U.S. health care system have levied complaints: Robert F. Kennedy Jr., the secretary of Health and Human Services (HHS), said that such programs are “rife with fraud, because we have no way at CMS to determine if they actually performed that duty or not.”

On the other hand,  the Ohio Capital Journal reported that DeWine has been defending the family caregiver Medicaid program for weeks. The outlet also reported that former Ohio House Speaker Jason Stephens, R-Kitts Hill, was happy that the family caregiver provision was removed from House Bill 795. 

“It feels like we’re moving in the right direction so far,” Stephens reportedly said. “Hopefully, we can come up with a product that does enable [us] to keep fraud, waste, and abuse at bay. But also, still, we aren’t harming the things that do work in Medicaid.”

And State Rep. Josh Williams, a Republican from Sylvania Township who introduced the provision, said that removing it was the right call based on constituent feedback.

“That was a direct result of listening to interested parties and constituents,” Williams said, according to the Capital Journal.

This failed bill provision demonstrates that while anti-fraud efforts in Ohio are already comprehensive and growing, support for the strictest levels of program integrity is not guaranteed, and advocacy can succeed.

Why this matters for the rest of the country

Examining Ohio’s anti-fraud measures is key because the state considers itself a leader in combatting Medicaid program integrity – and where there are leaders, there are followers.

I want to underscore that DeWine is following CMS’ advice on Medicaid home health moratoria. Given that CMS made the recommendation, we can anticipate that other states may follow suit. I also expect an increase in suspensions like those seen in Ohio, and we may see other states beefing up their data-tracking capabilities to better flag potentially fraudulent providers.

Ohio might as well be a microcosm of the Medicaid fraud landscape at this point. The state is taking cues from CMS by implementing proactive crackdowns while expanding anti-fraud efforts, but such initiatives are constrained by the need to maintain access to home-based services and the political risks involved in jeopardizing people’s care.

And as the home-based care sector as a whole responds to current aggressive anti-fraud actions, the low cost of the setting is one of the most powerful points to emphasize. That is, while fraud is costly and bad actors in the industry should be rooted out, negative headlines about fraudsters should not obscure the fact that expansion of at-home care is a powerful lever in bringing down overall healthcare costs. The good news is that Ohio is acknowledging this explicitly. See this statement from the state’s Department of Medicaid:

“Ohio’s home and community-based care programs are grounded in data showing that legitimate in-home care is typically safer for individuals and significantly more affordable for taxpayers. In 2024, Ohio saved more than $600 million in taxpayer funds that would have been expended had patients receiving home healthcare been diverted to skilled nursing or other residential care services, saving several billion dollars over the course of the DeWine Administration. On average, home health care costs half as much as placement in a nursing facility.

Ensuring access to appropriate home-based care is both a responsible use of public resources and a critical part of meeting the needs of our most vulnerable Ohioans who otherwise would require placement in higher-cost nursing facilities.”

While I’ve spoken of my concerns that program integrity efforts will be executed with too broad a brush, this demonstrates that in the longer term, compliant providers still have the wind at their backs: providing services that are preferred by clients and payers alike.