Corporate Compliance

OIG: Hospital failed to follow year-end claims billing rules

Compliance Monitor, September 21, 2005

The OIG found that a Maine hospital did not bill fiscal year-end claims for its inpatient rehabilitation facilities (IRF) in accordance with Medicare regulations. As a result, Medicare made net overpayments totaling $254,915. The hospital received inaccurate information from its fiscal intermediary that contributed to the problem of split billing in 2003 and 2004.

The OIG recommended that the hospital

  • continue to work with its fiscal intermediary to complete a voluntary repayment process

  • determine the resulting effect on its Medicare cost reports for 2002 - 2004

    The OIG took the following steps to complete the audit:

  • Reviewed applicable Medicare laws, regulations, and guidance

  • Extracted paid claims data for 2002, 2003, and 2004 from CMS's National Claims History and the fiscal intermediary's claims processing system

  • Identified a universe of 76 inpatient rehabilitation claims incorrectly billed by the hospital at its fiscal year end

  • Reviewed applicable detailed records for the claims from CMS's Common Working File to verify that the claims represented a single inpatient rehabilitation stay

  • Calculated the effect of incorrect billing by using CMS's Pricer Program

  • Discussed the results of the review with the hospital's fiscal intermediary, Associated Hospital Service, Inc.