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Feeley & Driscoll's OIG Update: December 2011 The Department of Health and Human Services Office of the Inspector General (HHS-OIG) was established by Congress in 1976 to identify and eliminate fraud, abuse, and waste in HHS programs and to promote efficiency and economy in departmental operations. The OIG is responsible for conducting audits, evaluations, and both criminal and civil investigations for all HHS agencies. These functions are performed by the OIG's Office of Audit Services (OAS). Feeley & Driscoll's OIG Update is a compilation of the latest additions from the OIG’s website. This update is a monthly publication from the Healthcare Group at Feeley & Driscoll, P.C. Contents
1. Place of Service Overpayments Refund Verification for Boston Medical Center for Calendar Years 2006 through 2010 The OIG determined that Boston Medical Center (the Hospital) submitted 7,520 claims with overpayments totaling approximately $90,000 for physician services for calendar years 2006 through 2010. The Hospital, billing on behalf of its physicians, incorrectly coded these claims by using nonfacility place-of-service codes for services that were performed in one of the Hospital's outpatient facilities. >Click here to view the full report 2. Review of Medicaid Payments for Nonemergency Medical Transportation Services Claims Submitted by Providers in New York City Based on the OIG’s sample results, the OIG estimates that the New York State Department of Health (DOH) improperly claimed approximately $17 million in Federal Medicaid reimbursement for 979,886 nonemergency medical transportation (NEMT) claims in New York City during the period April 1, 2005, through March 31, 2006. In addition, the OIG estimates that DOH claimed $2.9 million in Federal Medicaid reimbursement for 193,375 NEMT claims that may not have complied with Federal and State Medicaid requirements. States are required to ensure necessary transportation for Medicaid beneficiaries to and from providers. The OIG recommends that DOH:
DOH partially agreed with the OIG’s first recommendation (financial disallowance) and agreed with the OIG’s remaining recommendations. >Click here to view the full report 3. Medicare Compliance Review of Norwood Hospital for the Period July 2008 through June 2010 Norwood Hospital complied with Medicare billing requirements for 99 of the 198 claims the OIG reviewed. However, the Hospital did not fully comply with Medicare billing requirements for the remaining 99 claims, resulting in overpayments totaling $207,000 from July 2008 through June 2010. Overpayments occurred primarily because the Hospital did not have adequate controls to prevent incorrect billing of Medicare claims and did not fully understand Medicare billing requirements. >Click here to view the full report 4. Addressing Vulnerabilities Reported by Medicare Benefit Integrity Contractors As of January 2011, CMS had not resolved or taken significant action to resolve 77 percent of vulnerabilities reported by contractors in 2009. Of the 62 vulnerabilities reported by contractors in 2009, 77 percent (48 of 62) had not yet been resolved as of January 2011, nor had CMS taken significant action to resolve them. CMS took significant action to resolve 14 of the 62 vulnerabilities, but only 2 of these had been fully resolved by January 2011. The OIG recommends that CMS:
CMS concurred with the OIG’s first recommendation, did not concur with the OIG’s second recommendation, and partially concurred with the OIG’s third recommendation. >Click here to view the full report 5. Review of Medicare Payments Exceeding Charges for Outpatient Services Processed by Cahaba Government Benefit Administrators, LLC, in Jurisdiction 10 for the Period January 1, 2008, through June 30, 2009 The OIG’s audit found that 336 of the 452 selected line items for which Cahaba made Medicare payments to providers for outpatient services during the period January 2008 through June 2009 were incorrect. The line items included items totaling approximately $1.9 million, which the providers had not refunded by the beginning of the OIG’s audit. Providers refunded overpayments on 61 line items totaling $404,000 prior to the OIG’s fieldwork. The remaining 55 line items were correct. Medicare uses an outpatient prospective payment system to pay certain outpatient providers. In this method of reimbursement, the Medicare payment is not based on the amount that the provider charges. Billed charges generally exceed the amount that Medicare pays the provider. Therefore, a Medicare payment that significantly exceeds the billed charges is likely to be an overpayment. The deficiencies in the 336 incorrect line items included (1) incorrect units of service, (2) Healthcare Common Procedure Coding System (HCPCS) codes that did not reflect the procedures performed, (3) a lack of supporting documentation, and (4) a combination of incorrect units of service and incorrect HCPCS codes. The OIG recommends that Cahaba:
Cahaba generally agreed with the OIG’s recommendations. >Click here to view the full report 6. Review of Medicare Payments Exceeding Charges for Outpatient Services Processed by First Coast Service Options, Inc., in Jurisdiction 9 for the Period January 1, 2008, through June 30, 2009 The OIG’s audit found that 113 of the 295 selected line items for which First Coast made Medicare payments to providers for outpatient services during the period January 2008 through June 2009 were incorrect. The line items included items totaling approximately $847,000, which the providers had not refunded by the beginning of the OIG’s audit. Providers refunded overpayments on three line items totaling $544,000 before the OIG’s fieldwork. The remaining 179 line items were correct. Medicare uses an outpatient prospective payment system to pay certain outpatient providers. In this method of reimbursement, the Medicare payment is not based on the amount that the provider charges. Billed charges generally exceed the amount that Medicare pays the provider. Therefore, a Medicare payment that significantly exceeds the billed charges is likely to be an overpayment. The deficiencies in the 113 incorrect line items included (1) incorrect units of service, (2) a combination of incorrect units of service claimed and incorrect Healthcare Common Procedure Coding System (HCPCS) codes, (3) HCPCS codes that did not reflect the procedures performed, and (4) a lack of supporting documentation. The OIG recommends that First Coast:
>Click here to view the full report 7. Review of the Centers for Medicare & Medicaid Services’ Audits of Part D Sponsors’ Financial Records The OIG’s audit found that the Centers for Medicare & Medicaid Services (CMS) did not fully comply with Federal requirements in conducting one-third audits of Part D sponsors' financial records. CMS contracts with private organizations called sponsors that act as payers and insurers to provide prescription drug benefits under Part D. However, CMS did not perform audits for a full one-third of the sponsors in any of the audited contract years as required. CMS excluded certain contracts subject to audit because it interpreted the statutory requirement as allowing it to do so. Further, at the time of the OIG’s fieldwork, CMS had not updated its standard operating procedure (SOP) for audit resolution to reflect actual practices and to help ensure that sponsors reported corrective actions to CMS in a timely manner. This diminished CMS's ability to ensure that corrective action was taken as rapidly as possible. The OIG recommends that CMS:
CMS generally concurred with the OIG’s recommendations and described the actions it had taken or planned to take. >Click here to view the full report 8. Review of Medicare Payments Exceeding Charges for Outpatient Services Processed by National Government Services but Transitioned to Palmetto GBA, LLC, in Jurisdiction 11 for the Period January, 1, 2006, through June 30, 2009 The OIG’s audit found that 695 of 942 selected line items for which National Government Services (NGS) made Medicare payments to providers for outpatient services during the period January 2006 through June 2009 were incorrect. The line items included overpayments totaling $5.2 million that the providers had not refunded by the beginning of the OIG’s audit. Providers refunded overpayments on 85 line items totaling $318,000 before the OIG’s fieldwork. The remaining 162 line items were correct. Because Palmetto GBA, LLC (Palmetto), has assumed responsibility for claims paid by NGS, the OIG has addressed its findings and recommendations to Palmetto for review and comment. Medicare uses an outpatient prospective payment system to pay certain outpatient providers. In this method of reimbursement, the Medicare payment is not based on the amount that the provider charges. Billed charges generally exceed the amount that Medicare pays the provider. Therefore, a Medicare payment that significantly exceeds the billed charges is likely to be an overpayment. The deficiencies in the 695 incorrect line items included (1) incorrect units of service, (2) lack of supporting documentation, (3) a combination of incorrect units of service and incorrect Healthcare Common Procedure Coding System (HCPCS) codes, (4) billing separately for services for which payment was packaged in the payment for the primary service, (5) incorrect HCPCS codes, (6) unallowable services or drugs, and (7) billing for the unlabeled use of a drug/biological. The OIG recommends that Palmetto:
Palmetto generally concurred with the OIG’s findings and recommendations and described corrective actions that it had taken or planned to take. >Click here to view the full report 9. Review of 24 Head Start Grantees’ Compliance with Health and Safety Requirements Of the 24 Head Start grantees that the OIG reviewed, none complied fully with Federal Head Start or State requirements to protect children from unsafe materials and equipment, and 21 of 24 grantees did not comply fully with Federal Head Start or State requirements to conduct criminal records checks, conduct recurring background checks, document criminal records checks, conduct checks of childcare exclusion lists, or conduct checks of child abuse and neglect registries. The American Recovery and Reinvestment Act of 2009 provided an additional $2.1 billion for Head Start during fiscal years 2009 and 2010. The State requirements varied. The Administration for Children and Families (ACF) could adopt some of the State-specific requirements for background checks to better protect the health and safety of children. Those State requirements included periodic fingerprinting, conducting recurring background checks, and developing an exclusion list to deny employment to individuals who have been convicted of certain crimes. The OIG recommends that ACF:
In written comments on the OIG’s draft report, ACF stated that it is analyzing the OIG’s recommendation to implement periodic background checks of all Head Start employees. In addition, ACF stated that it is analyzing the need for legislative action related to implementing periodic background checks, its regulatory authority to change the current requirements for background checks, and its authority to amend current policies related to background checks. >Click here to view the full report 10. Medicaid Managed Care: Fraud and Abuse Concerns Remain Despite Safeguards The OIG found that although managed care entities (MCE) and States are taking steps to address fraud and abuse in managed care, they remain concerned about their prevalence. States have increasingly adopted managed care in response to Medicaid expenditures, which have nearly doubled in the past decade. CMS requires MCEs to meet specific program integrity requirements as a condition for receiving payment. CMS also requires MCEs to disclose to States certain information, such as ownership and control. States are directly responsible for monitoring MCE operations. CMS's Medicaid Integrity Group (MIG) conducts program integrity reviews of States and MCEs. In 2000, CMS issued guidelines to States for addressing fraud and abuse in Medicaid managed care. The guidelines identified six areas of concern. >Click here to view the full report Share this Article |
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