This week in Medicare updates—2/28/18

February 28, 2018
Medicare Insider

Medicare Improperly Paid Providers for Specimen Validity Tests Billed in Combination with Urine Drug Tests

On February 20, the OIG published the results of a Review of Medicare to determine whether Medicare payments to providers for specimen validity tests complied with Medicare billing requirements from 2014 through 2016. The OIG found that Medicare improperly paid 4,480 providers a total of $66.3 million for specimen validity tests combined with urine drug tests despite the fact that this combination of tests should be a rare occurrence. These improper payments were due to a combination of providers not following Medicare guidance and inadequate CMS system edits. Although CMS implemented a new system edit for these payments on April 1, 2016, Medicare still issued $1.8 million in improper payments through the final months of the audit period (April 1, 2016 - December 31, 2016).

The OIG recommends CMS direct Medicare contractors to recover the $66.3 million in improper payments. It also recommends CMS strengthen system edits to prevent more of these improper payments and educate providers on how to properly bill for specimen validity and urine drug tests. CMS concurred with the OIG’s recommendations and asked the OIG for data needed to follow up on the status of the payments. The OIG said it will provide the necessary data to CMS.


Medicare Compliance Review of Memorial University Medical Center

On February 21, the OIG published a Review of Memorial University Medical Center to determine whether Memorial complied with Medicare requirements for billing inpatient and outpatient services on a random sample of 131 claims. The OIG found Memorial did not fully comply with Medicare billing requirements for 39 of the 131 claims, resulting in $599,530 of overpayments in 2015 and 2016 for those claims. The OIG estimated that the hospital received at least $1.4 million in overpayments during those years based on the results from the random sample.   

The OIG found that 23 of the 36 inpatient claims that were billed in error were due to inpatient rehabilitation facility services incorrectly billed as inpatient services. All three outpatient claims billed in error were due to the hospital incorrectly billing Medicare for medical devices under warranty, as these claims did not contain value code FD due to human error. The OIG recommended Memorial refund Medicare the estimated $1.4 million in overpayments, identify and return any additional overpayments, and strengthen controls to ensure full compliance. Memorial did not agree with all of the OIG findings and specifically objected to 17 claim errors related to inpatient rehabilitation facility services.


Enforcement Instruction on Supervision Requirements for Outpatient Therapeutic Services in Critical Access Hospitals and Small Rural Hospitals

On February 22, CMS published a Notice informing providers in critical access hospitals and small rural hospitals of a provision from the Bipartisan Budget Act of 2018, which extends CMS instruction to not enforce supervision requirements for therapeutic services provided to outpatients in these facilities. The Act extends the enforcement instruction through December 31, 2017. The 2018 OPPS/ASC final rule also continues the enforcement instruction for calendar years 2018 and 2019.


Form CMS-855O Processing Guide

On February 23, CMS published Medicare Program Integrity Transmittal 773 to add a supplementary guide educating providers and suppliers on the preparation and submission of the CMS-855O form (Medicare Enrollment Application).  

Effective date: March 23, 2018

Implementation date: March 23, 2018


Clarification of Instructions Regarding the Intensive Level of Rehabilitation Therapy Services Requirements

On February 23, CMS published Medicare Program Integrity Transmittal 771 to clarify instructions for conducting medical review of inpatient rehabilitation facility claims when reviewing the requirements for the intensive level of rehabilitation therapy services. The new guidance states absolute claim denials should not be made solely if the industry standard therapy time requirement is not met. It also states claims should not be denied solely because a rationale to justify group therapy was not submitted in response to an additional documentation request.

Effective date: March 23, 2018

Implementation date: March 23, 2018