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OIG withdraws Medicare proposed rule

Patient Access Weekly Advisor, June 20, 2007

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On June 18, the OIG published in the Federal Register a notice withdrawing a previous rule proposed in the September 15, 2003 Federal Register addressing a providers "usual charge" and setting a threshold for "substantially in excess" of usual charge.

The original rule aimed to define important terms in their authority to exclude providers that submit claims to Medicare or Medicaid "containing charges or costs that are substantially in excess of such entity's usually charges or costs."

The OIG also proposed a benchmark of 120% of the "usual charge" as "substantially in excess."

Not surprising, the rule was met with harsh criticism. It "created a great deal of fervor primarily due to the administrative burdens it would have imposed on providers," said Kimberly Hoy, director of Medicare and compliance for HCPro. "Based on the comments they received, the OIG withdrew their proposal."

The OIG will continue to follow guidance on how providers should treat discounts for uninsured and underinsured patients when calculating the "usual charge."

The policy is that "a provider need not include free or reduced charges to uninsured or underinsured patients when calculating their usual charge for an item or service," Hoy said.

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