Inpatient claims subject to post-acute transfer policy to fall under OIG review again

The Office of Inspector General (OIG) will be taking a closer look at payments for inpatient claims subject to CMS’ post-acute transfer policy, according to a recent update to the OIG work plan.

The audit, slated for this year, is a follow up to a previous OIG review that found that Medicare made overpayments to hospitals that did not comply with its post-acute transfer policy.

Inpatient claims are typically paid an MS-DRG rate when a patient is discharged to home. However, if a patient is transferred from an acute care setting to post-acute care, such as a skilled nursing facility or home health services, for additional treatment, Medicare pays the inpatient claim at a per-diem rate for each day of the inpatient stay.

This rate is not to exceed the full MS-DRG payment that would have been received if the patient had been discharged to home. The OIG found that hospitals did not always use the correct patient discharge status codes on claims and in some cases incorrectly indicated that the patient was discharged to home when the patient was actually transferred to post-acute services. According to the OIG’s review, CMS’ common working file (CWF) edits for transfers to home health, SNFs, and non-IPPS hospitals weren’t working correctly. CMS agreed with the OIG’s recommendation that it fix the CWF edits and recover identified overpayments.

The follow-up audit will determine whether CMS implemented the corrections to the CWF edits and whether they are now working properly. Hospitals should monitor OIG reports for more information and conduct internal audits on compliance with CMS’ post-acute transfer policy.

Simple errors can easily lead hospitals to coding and documentation pitfalls and the consequences of those can be far-reaching. If you have experience successfully navigating audits and Medicare compliance programs, consider sharing your expertise with your peers at the National Association of Healthcare Revenue Integrity’s (NAHRI) 2019 Revenue Integrity Symposium (RIS), October 15-16, in Orlando. NAHRI is currently seeking speakers to present on a range of revenue integrity and Medicare compliance topics. Click here to learn more about RIS, the application process, and potential topics.