Dive Brief:
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A new HHS Office of Inspector General report found that Medicare overpaid hospitals as much as $21.5 million for intensity-modulated radiation therapy planning services.
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OIG found that payments for outpatient IMRT planning services didn't comply with Medicare billing requirements. The issue included hospitals separately billing for complex simulations when they were performed as part of IMRT planning.
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The report blamed the overpayments mostly on hospitals not knowing or misinterpreting CMS guidance.
Dive Insight:
Federal regulators, including the Department of Justice, have been focused on rooting out Medicare and Medicaid overpayments, including a recent crackdown on $2 billion in false claims that was billed as the largest healthcare fraud takedown ever. Another HHS OIG report faulted managed care organizations for failing to use proactive data analysis to detect fraud, waste and abuse as well as not notifying states of bad actors.
Providers are sometimes accused of upcoding as a way to make more money, but as this report showed, confusing or contradictory rules can also be the problem.
OIG conducted the study after previous reviews found that some hospitals improperly received separate payments for the services in addition to a bundled payment that facilities receive to cover for IMRT planning services. The report used computer matching, data mining and data analysis techniques to identify potential overpayments.
The watchdog agency found that claims processing edits didn't prevent the overpayments. The issue was that the edits only applied to services billed on the same date of service as the billing of the procedure code for the bundled payment. The services in the report were charged on a different date of service.
In addition to the $21.5 million in overpayments across the country, investigators found $4.2 million in potential overpayments for other IMRT planning services not included in the study sample.
They identified another $3.7 million in potential overpayments for complex situations and $1.7 million for other IMRT planning services in the two years after the audit period in 2016 and 2017.
In light of OIG's findings, the report recommended CMS create an edit to prevent improper payments for IMRT planning services billed before the procedure code for the bundled payments for IMRT planning. If CMS had that policy, it could have saved as much as $25.8 million during the audit period and as much as $5.4 million in the two years after the audit period.
OIG also recommended that CMS work with Medicare contractors to improve education efforts for hospitals to properly bill Medicare. CMS concurred with both of the report's suggestions.