OIG Posts 4 reports, updates CMP case summaries and provides news about enforcement actions - 8/28

New content posted on OIG.HHS.GOV

Good morning to all from Washington, DC. Today OIG posts four reports, updates the Civil Monetary Penalties case summaries and provides news about enforcement actions. As always, you can use the links provided to go directly to the new material.

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Medicare Contractors’ Payments in Jurisdiction 14 for Full Vials of Herceptin Were Often Incorrect (A-01-11-00539) http://go.usa.gov/rNpw

Almost half of the Medicare payments that NHIC, Corp. (NHIC), made to providers for full vials of Herceptin were incorrect.  Specifically, of the 853 selected line items, 391 (46 percent) were incorrect and included overpayments totaling $403,000, or more than one-fifth of total dollars reviewed.  These providers had not identified or refunded these overpayments by the beginning of our audit.  Providers refunded overpayments on 130 line items totaling $141,000 before our fieldwork.  The 332 remaining line items were correct.

For the 391 incorrect line items that had not been refunded, providers reported incorrect units of service on 386 line items with unit counts that represented full multiuse-vials, resulting in overpayments totaling $395,000, and did not provide supporting documentation for 5 line items, resulting in an overpayment of $8,000.  The providers attributed the incorrect payments to clerical errors and billing systems that could not prevent or detect the incorrect billing of units of service.  NHIC made these incorrect payments because neither the Fiscal Intermediary Standard System nor the Common Working File had sufficient edits in place during our audit period to prevent or detect the overpayments. 

We recommended that NHIC:

(1) Recover the $403,000 in identified overpayments,

(2) Implement or update system edits that identify for review multiuse-vial drugs that are billed with units of service equivalent to the dosage of an entire vial(s), and

(3) Use the results of this audit in its provider education activities. 

NHIC concurred with our recommendations.

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Review of Medicare Payments Exceeding Charges for Outpatient Services Processed by Wisconsin Physicians Service Insurance Corporation But Transitioned to Palmetto Government Benefits Administrator in Jurisdiction 1 for the Period January 1, 2006, Through June 30, 2009 (A-07-11-04182) http://go.usa.gov/rNVA

Our audit found that 280 of 344 selected line items for which Wisconsin Physicians Service Insurance Corporation (WPS) made Medicare payments to providers for outpatient services during the period January 2006 through June 2009 were incorrect.  The 280 incorrect line items included overpayments totaling $2.2 million, which the providers had not refunded by the beginning of our audit.  Providers refunded overpayments on five line items totaling $138,000 before our fieldwork.  The remaining 59 line items were correct.  Effective April 2010, the claims that were originally processed by WPS in Jurisdiction 1 were transitioned to Palmetto Government Benefits Administrator (Palmetto).

Medicare uses an outpatient prospective payment system to pay certain outpatient providers.  In this method of reimbursement, the Medicare payment is not based on the amount that the provider charges.  Billed charges generally exceed the amount that Medicare pays the provider.  Therefore, a Medicare payment that significantly exceeds the billed charges is likely to be an overpayment.

The deficiencies in the 280 incorrect line items included incorrect units of service, services that lacked supporting documentation, incorrect Healthcare Common Procedure Coding System (HCPCS) codes, services not allowable for Medicare reimbursement, and a combination of incorrect number of units of service and incorrect HCPCS codes.

We recommended that Palmetto:

(1) Recover the $2.2 million in identified overpayments,

(2) Work with the Centers for Medicare & Medicaid Services to implement system edits that identify line item payments that exceed billed charges by a prescribed amount, and

(3) Use the results of this audit in its provider education activities. 

In written comments, Palmetto stated that $1.3 million of the $2.2 million in identified overpayments had been recovered.  Palmetto also described actions that it had taken or planned to take to address our recommendations.

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Blue Cross Blue Shield of Tennessee Did Not Claim Some Allowable Pension Costs for Fiscal Years 2003 through 2009 (A-07-12-00390) http://go.usa.gov/rNpQ

Blue Cross Blue Shield of Tennessee (BCBS Tennessee), a Centers for Medicare & Medicaid Services (CMS) contractor, did not claim $221,000 of pension costs that were allowable for Medicare reimbursement for fiscal years 2003 through 2009.  In addition, BCBS Tennessee’s entire qualified defined benefit plan termination claim of $444,000 was unallowable for Medicare reimbursement.  BCBS Tennessee administered Medicare Part A operations under cost reimbursement contracts with CMS until the contractual relationship was terminated effective August 1, 2009.

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Blue Cross Blue Shield of Tennessee Overstated the Medicare Segment Pension Assets and Medicare’s Share of the Excess Pension Liabilities Due to the Segment Closing (A-07-12-00389) http://go.usa.gov/rNpB  

Blue Cross Blue Shield of Tennessee (BCBS Tennessee), a Centers for Medicare & Medicaid Services (CMS) contractor, overstated the Medicare segment pension assets by $176,000 and overstated Medicare's share of excess pension liabilities, due to the termination of the Medicare contracts, by $179,000.  BCBS Tennessee administered Medicare Part A operations under cost reimbursement contracts with CMS until the contractual relationship was terminated effective August 1, 2009.

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Civil Monetary Penalties Case Summary Updates

False and Fraudulent Claims Cases http://go.usa.gov/rNyF

Kickback and Physician Self-Referral Cases http://go.usa.gov/rNVT

Patient Dumping Cases http://go.usa.gov/rNV9

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August 23, 2012; U.S. Attorney; District of Massachusetts

Two Holyoke Residents Plead Guilty to Health Care Fraud http://go.usa.gov/yWn

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State Enforcement Actions Updated http://go.usa.gov/pqp

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That’s all we have for today. If we can be of any further assistance, please send an Email to public.affairs@oig.hhs.gov

Make it a great day!

Marc Wolfson – Office of External Affairs