Corporate Compliance

NHIC makes inappropriate payments for outpatient laboratory services

Compliance Monitor, November 29, 2007

The OIG found that the National Heritage Insurance Company (NHIC) made inappropriate Part B payments for outpatient laboratory services received by Medicare beneficiaries during inpatient stays at prospective payment system hospitals in 2005. NHIC paid laboratory suppliers $292,524 for laboratory services.

The OIG recommended NHIC:

  • Recover $13,101 in overpayments for the sampled services
  • Reemphasize to laboratory suppliers the need for internal control systems to prevent improper billing
  • Adjust its existing prepayment edits to identify and deny payments for laboratory services billed with the inpatient hospital place of service code.

NHIC agreed with the OIG's findings and recommendations.

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