U.S. Inspector General Estimates $6.4M in CMS Overpayments

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A new audit from the Office of the Inspector General estimates some $6.4 million in overpayments to hospital outpatient providers in 2008 and 2009 for services rendered within three days of the beneficiaries’ admissions. These include overpayments for diagnostic imaging services.

“These overpayments occurred because provider controls failed to prevent or detect incorrect billing, providers were unaware that beneficiaries were inpatients at other facilities, and providers were unaware of or did not understand Medicare requirements,” reads a summary statement accompanying the report.

On the administrative side, the report notes, Medicare contractors did not have good safeguards in place to prevent such failings. Although there were some breakdowns in communication from CMS to contractors, institutional behavioral issues, including systematically overriding or ignoring system alerts and edits, and failing to “recover or offset overpayments,” were also in play.

In addition to resolving the internal issues that contributed to this assessment, OIG recommends that CMS immediately recover some $340,000 in overpayments of 61 incorrectly billed services and put together a plan to recoup the remainder of the estimated $6.1 million related to 148,175 potentially overpaid services.