Reading Between the Lines of the 2013 OIG Work Plan - 1 of 4

on Tuesday, 16 October 2012. All News Items | OIG

Are You Behaving? – OIG Compliance Reviews

Part One: Are You Behaving? – OIG Compliance Reviews

The Office of Inspector General (OIG) recently released their 2013 Work Plan. The OIG’s work plan spells out the OIG’s current focus areas and states the primary objectives of each project. But instead of just listing the hospital review topics for 2013 (providers can read these at 2013 OIG Work Plan Medicare Part A & B), let’s “read between the lines” to try to determine the real impact of the reviews on hospital providers. This is the first in a series of four articles on the hospital reviews in the 2013 OIG work plan.

One of the tasks of the OIG is to ensure compliance with Medicare regulations. A number of the OIG hospital target reviews are to determine if providers are meeting CMS billing or other requirements.

  • Inpatient and Outpatient Payments to Acute Care Hospitals – These are audits to determine compliance with certain billing requirements. The OIG has selected areas at risk for noncompliance from their previous work and uses computer matching and data mining techniques to select targets for these reviews. I suggest providers read the OIG reports of these types of reviews in order to become familiar with the “at-risk” issues. Examples of such issues from previous compliance audits include:
    • Lack of medical necessity for inpatient admissions
    • Incorrect discharge disposition
    • DRG coding errors
    • Incorrect HCPCS codes on outpatient claims
    • Errors in units billed, especially drug units
    • Improper use of modifier 59
    • Insufficient documentation to support services billed
  • Inpatient and Outpatient Hospital Claims for the Replacement of Medical Devices – This audit determines if hospitals are billing procedures with the appropriate modifiers when medical devices are furnished at zero or reduced costs so that they do not receive overpayments from Medicare for the procedures. See the Medicare Claims Processing Manual for detailed instructions on billing for no-cost or reduced-cost devices – Chapter 4, section 61.3; Chapter 3, section 100.8; and Chapter 32, section 67.2.1. An interesting note here is that in some reports the OIG has indicated that it is the hospitals’ responsibility to determine if discounts from the manufacturer are available.
  • Outpatient Dental Claims – Dental claims are often overpaid because dental services are generally excluded from Medicare coverage, with a few exceptions. See the Medicare Benefits Policy Manual for more information on dental coverage – chapter 15, section 150 and chapter 16, section 140.
  • Payments for Mechanical Ventilation (NEW) to determine whether the DRG assignments and resultant payments were appropriate. Certain DRGs require that the patient receive 96 or more hours of mechanical ventilation – the OIG will be looking for these DRGs billed when the patient received less than 96 hours of mechanical ventilation.
  • Audits to determine if hospitals correctly report occupational-mix data used to calculate inpatient wage indexes.
  • Audits to determine if physician practices using the provider-based status met CMS billing requirements (NEW).
  • And although presented as trending reviews, the OIG could also determine provider compliance for the following two issues:
    • Inpatient outlier payments – The issue notes that there have been millions of dollars in settlements related to inflated pricing causing increased outlier payments. Hospitals should ensure their pricing structure is appropriate.
    • Same-day readmissions – Testing the effectiveness of the edit could result in identification of hospital misuse of condition code B4 to override the edit that prevents duplicate payment of same-day readmissions. Who in your hospital determines whether same-day readmissions are related or not and how is that information communicated to the billers?

In reviewing the above issues, hospitals should determine if they have systems and controls in place to ensure compliance with the applicable Medicare regulations.

Next week we will look at work plan topics that examine trends and characteristics of certain hospital services.

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