OIG releases top unimplemented recommendations

An analysis of the impact of the three-night requirement for skilled nursing facility (SNF) admission, wage index reform, and costs of recalled medical devices top the Office of Inspector General’s (OIG) list of top unimplemented recommendations.

In a report published July 22, Solutions to Reduce Fraud, Waste, and Abuse in HHS Programs: OIG's Top Recommendations, the OIG reviewed recommendations that CMS has not implemented and discussed how they may improve the Medicare program and beneficiaries’ well-being. The report covers eight unimplemented recommendations for Medicare parts A and B, three for Medicare parts C and D, and seven for Medicaid.

The OIG’s top unimplemented recommendation is a review of how inpatient and outpatient days are counted for Medicare coverage of SNF services. Patients must be an inpatient for three days before Medicare will cover SNF services; any days spent as an outpatient cannot count toward the three-day requirement. Therefore, beneficiaries with similar post-acute care needs may have different access to SNF services and different cost sharing. The OIG has also found that many SNFs incorrectly used a combination of inpatient and outpatient days to determine whether the three-day requirement was met, leading to an estimated $84.2 million in overpayments between 2013 and 2015. Although CMS analyzed of the impact of counting time spent as an outpatient toward the three-day requirement in 2014, it needs to conduct an updated analysis as well as a review of the impact failure to meet the three-day requirement has on beneficiaries.

Other top unimplemented recommendations include:

• Implementing the statutory mandate requiring surety bonds for home health agencies that enroll in Medicare
• Including medical device information and condition codes on claims to track replacement costs for recalled or prematurely failed medical devices
• Establishing additional remedies for hospices with poor performance
• Reforming the hospital wage index system

CMS proposed a new methodology for hospital wage index calculation in the FY 2020 Inpatient Prospective Payment System proposed rule. The agency is proposing to increase the wage index for hospitals below the 25th percentile of the wage index value and decrease the wage index for hospitals above the 75th percentile of the wage index value.

Organizations should stay alert for future rulemaking and audits related to the OIG’s recommendations.