Medicare Update: OIG Work Plan Reveals Possible Risk Areas for Medicare Providers and Suppliers

On October 1, 2009, the Department of Health and Human Services' Office of Inspector General (OIG) released its Work Plan for fiscal year 2010 (Work Plan).

The Work Plan addresses the areas and issues the OIG intends to audit, evaluate and inspect during fiscal year 2010. The Work Plan also provides some insight into the areas and issues that may evolve into future OIG enforcement activities. Therefore, health care providers and suppliers should consider the Work Plan in relation to their operations.

This post briefly highlights some of the Work Plan priorities for hospitals, physicians and other health care providers with respect to Medicare Parts A and B. Work Plan priorities for Medicare provider and supplier types not addressed in this post (e.g., home health agencies) will be covered in subsequent posts.

Hospitals

Part A Hospital Capital Payments. The OIG will review Medicare inpatient capital payments and determine whether the capital payments are appropriate and analyze the appropriateness of the payment level.
Provider-Based Status of Inpatient and Outpatient Facilities. The OIG will review cost reports of hospitals claiming provider-based status for inpatient and outpatient facilities. The OIG will determine the appropriateness of the provider-based designation and the potential impact on Medicare and its beneficiaries of hospitals improperly claiming such provider-based status.
Part A Inpatient Prospective Payment System Wage Indexes. The OIG will review hospital and Medicare controls over the accuracy of the hospital wage index data used to calculate wage indexes for the inpatient prospective payment system (IPPS). The OIG will determine the effect on Medicare of incorrect diagnosis-related group (DRG) reimbursement caused by inaccurate wage data. The OIG will also examine the appropriateness of using hospital wage indexes for other provider types.
Hospital Payments for Nonphysician Outpatient Services Under IPPS. The OIG will review the appropriateness of payment for nonphysician outpatient services that were provided shortly before or during Medicare Part A covered stays at acute care hospitals.
Payments to Organ Procurement Organizations. The OIG will review Medicare payments made to organ procurement organizations and determine whether the payments made are correct and supported.
Inpatient Rehabilitation Facility Submission of Patient Assessment Instruments. The OIG will review Medicare payments for inpatient rehabilitation facilities (IRF) stays in which patient assessments were transmitted to the Centers for Medicare & Medicaid Services (CMS) later to determine whether payments were correctly made. The OIG will also review IRF claims to determine whether patient assessments were submitted in accordance with Medicare regulations.
Critical Access Hospitals. The OIG will review payments to critical access hospitals (CAH) and determine whether CAHs have met the CAH designation criteria and conditions of participation, and whether payments made to CAHs were made in accordance with Medicare requirements.
Medicare Disproportionate Share Payments. The OIG will review Medicare disproportionate share hospital payments and determine whether the payments were made in accordance with the Medicare methodology. The OIG will also examine the total amounts of uncompensated care costs that hospitals incur.
Duplicate Graduate Medicare Education Payments. The OIG will review provider data from CMS's Intern and Resident Information System (IRIS) to determine whether duplicate graduate medical education (GME) payments have been claimed. If duplicate payments were claimed, the OIG will determine which payment was appropriate. The OIG will also assess the effectiveness of IRIS in preventing providers from receiving payments for duplicate GME costs.
Interrupted Stays at Inpatient Psychiatric Facilities Payments. The OIG will review inpatient psychiatric facilities' (IPF) claims in cases of transfers from IPFs to the same or other IPFs. The OIG will determine the extent to which coding errors (for claims that should have been paid as transfers) have resulted in the submission of improper claims by IPFs under IPF-PPS.
Provider Bad Debts. The OIG will review Medicare bad debts claimed by acute care hospitals, long term care hospitals (LTCH), IRFs, IPFs and skilled nursing facilities (SNF) to determine whether they were reimbursable. In particular, the OIG will determine whether the bad debt payments were appropriate under Medicare regulations and whether recoveries of prior year writeoffs were properly used to reduce the cost of beneficiary services for the period in which the recoveries were made.
Medicare Secondary Payer. The OIG will assess the effectiveness of current procedures in preventing inappropriate Medicare payments for beneficiaries with other insurance coverage including procedures for identifying and resolving credit balance situations.
Reliability of Hospital Reported Quality Measure Data. The OIG will review hospitals' controls for ensuring the accuracy of data related to quality of care that they submit to CMS for Medicare reimbursement and determine whether there are sufficient controls to ensure quality measurement data is valid.
Hospital Admissions With Conditions Coded Present-On-Admission. The OIG will review Medicare claims to determine the number of inpatient hospital admissions for which certain diagnoses were coded as being present-on-admission (POA) and determine which of the diagnoses were most frequently coded as POA. The OIG will also determine which types of facilities are most frequently transferring patients with a POA diagnosis specified by CMS to hospitals and whether specific providers transferred a high number of patients to hospitals with POA diagnoses.
Hospital Readmissions. The OIG will review Medicare claims to determine trends in the number of hospital readmission cases. Based on prior OIG work, CMS implemented an edit in 2004 to reject subsequent claims on behalf of beneficiaries who were readmitted to the same hospital on the same day. The OIG will test the effectiveness of the edit. The OIG will also determine the extent of oversight of readmission cases.
Adverse Events: National Incidence Among Medicare Beneficiaries. The OIG will review adverse health care events among Medicare beneficiaries in inpatient hospital settings to estimate the national incidence of such events, identify types of adverse events experienced in hospital settings, and assess the extent to which serious reportable events and other adverse events were preventable as determined by a panel of physicians with expertise in patient safety.
Adverse Events: Methods to Identify Events. The OIG will examine various methods for identifying adverse health care events. This review will examine the following methods to assess their utility: (i) medical record reviews by both nurses and physicians; (ii) administrative data analysis using the Agency for Healthcare Research and Quality's patient safety indicators and POA indicators; (iii) hospital incident reports; and (iv) interviews with Medicare beneficiaries or their representatives.
Adverse Events: Early Implementation of Medicare's Policy on Hospital Acquired Conditions. The OIG will review CMS's administrative process for identifying hospital-acquired conditions (HAC) and denying higher Medicare reimbursement for related care. The OIG will determine changes in the number of claims with identified HACs, Medicare reimbursement for such claims resulting from implementing CMS's policies, and the percentage of claims that otherwise would have resulted in higher Medicare reimbursement.
Adverse Events: Responses by Medicare Oversight Entities. The OIG will review responses of State survey and certification agencies, State licensure boards, and Medicare accreditors to adverse events in hospitals. The OIG will identify and analyze potential overlaps, conflicts, and gaps in responses and identify opportunities for Medicare oversight entities to improve the quality of oversight and responses to adverse events.
Adverse Events: Disclosure of Adverse Event Information. The OIG will review policies and practices of CMS and selected patient safety organizations for disclosing information about adverse health care events and associated protections intended to ensure patient privacy.
Payments for Diagnostic X-Rays in Hospital Emergency Departments. The OIG will review a sample of Medicare Part B paid claims and medical records for diagnostic x-rays performed in hospital emergency departments to determine the appropriateness of payments.
Oversight of Hospital Compliance with EMTALA. The OIG will review CMS's oversight of hospitals' compliance with the Emergency Medical Treatment and Labor Act of 1986. The OIG will identify variations (if any) among regions in the number of EMTALA complaints and cases referred to States, examine CMS's methods for tracking complaints and cases, and determine whether required peer reviews have been conducted prior to CMS making a determination about whether to terminate noncompliant providers from the Medicare program.
Observation Services During Outpatient Visits. The OIG will review Medicare payments for observation services provided during outpatient visits in hospitals. The OIG will assess whether and to what extent hospitals' use of observation services affects the care beneficiaries receive and their ability to pay out-of-pocket expenses for health care services.
Coding and Documentation Changes under MS-DRG System. The OIG will review the impact of the Medicare Severity Diagnosis Related Group (MS-DRG) system. The OIG will examine coding trends and patterns under the new system and determine whether specific MS-DRGs are vulnerable to potential upcoding.
Financial Status of Hospitals in New Orleans Area. The OIG will review the financial status of hospitals in the New Orleans area to assess the hospitals' needs and options for policymakers as the area rebuilds its health care infrastructure. The OIG will also determine whether the grantees (of provider stabilization and workforce supply grants) were effective in meeting the objectives.

Physicians and Other Medicare Part A/B Providers

Physician Billing for Medicare Hospice Beneficiaries. The OIG will review the extent of Part B billing for physician services provided to Medicare hospice beneficiaries. This study is a follow up to recent OIG studies on hospice care. The OIG will determine the frequency of and total expenditures for physician services under Parts A/B for hospice beneficiaries and identify whether physicians double billed hospice services to Parts A and B.
Trends in Medicare Hospice Utilization. The OIG will review Medicare Part A hospice claims to identify trends in hospice utilization and examine the characteristics of hospice beneficiaries, geographical variations in utilization, and differences between for profit and not-for-profit providers.
Medicare Incentive Payments for E-Prescribing. The OIG will review Medicare incentive payments made in 2010 to eligible health care professionals for their 2009 electronic prescribing (e-prescribing) activities. The Medicare Improvement for Patients and Providers Act of 2008 (MIPPA) provides for incentive payments to eligible health care professionals for e-prescribing beginning in 2010 and continuing through 2013. The OIG will assess whether and (if so) the extent to which incentive payments for e-prescribing activities in 2009 were made in error. If erroneous payments were made, the OIG will assess CMS's actions to remedy erroneous payments and its plans for overseeing payments made throughout the MIPAA authorized program. The OIG will also identify potential vulnerabilities to assist in CMS's oversight preparations.
Place of Service Errors. The OIG will review physician coding of place of service on Medicare Part B claims for services performed in ambulatory surgical centers (ASC) and hospital outpatient departments. The OIG will determine whether physicians properly coded the place of services on such claims.
ASC Payment System. The OIG will review the appropriateness of the methodology for setting ASC payment rates under the revised ASC payment system. The OIG will examine changes to the revised ASC payment system and the rate setting methodology used to calculate ASC payment rates.
Evaluation and Management Services During Global Surgery Periods. The OIG will review industry practices related to the number of evaluation and management (E&M) services provided by physicians and reimbursed as part of the global surgery fee. The OIG will determine whether industry practices related to the number of E&M services provided during the global surgery period have changed since the global surgery fee concept was developed in 1992.
Medicare Payments for Part B Imaging Services. The OIG will review Medicare payments for Part B imaging services. For selected services, the OIG will focus on the practice expense components, including equipment utilization rate. The OIG will determine whether Medicare payment reflects the actual expenses incurred and whether the utilization rate reflects current industry practices.
Services Performed by Clinical Social Workers. The OIG will review services furnished by clinical social workers (CSW) to inpatients of Medicare participating hospitals or SNFs to determine whether the services were separately billed to Medicare Part B. It appears that the OIG will examine Medicare Part A and B claims with overlapping dates of service in this review.
Outpatient Physical Therapy Services Provided by Independent Therapists. The OIG will review outpatient physical therapy services provided by independent therapists to determine whether they are in compliance with Medicare regulations. According the OIG, previous OIG work has identified claims for therapy services provided by independent physical therapists that were not reasonable, medically necessary or properly documented. Focusing on independent therapists with high utilization rates for outpatient physical therapy services, the OIG will determine whether the services billed to Medicare were in accordance with Federal requirements.
Appropriateness of Medicare Payments for Polysomnography. The OIG will examine the appropriateness of medicare payments for sleep studies, factors contributing to the rise in Medicare payments for sleep studies, and assess provider compliance with Federal program requirements.
Laboratory Test Unbundling by Clinical Laboratories. The OIG will review the extent to which clinical laboratories have inappropriately unbundled laboratory profile or panel tests to maximize Medicare payments. The OIG will also determine the extent to which the Medicare carriers have controls in place to detect and prevent inappropriate payments for laboratory tests.
Medicare Billings With Modifier GY. The OIG will review the appropriateness of providers' use of modifier GY on claims for services that are not covered by Medicare. In fiscal year 2008, Medicare received over 75.1 million claims with a modifier GY totaling approximately $820 million. The OIG will examine patterns and trends for physicians' and suppliers' use of modifier GY.
Geographic Areas With a High Density of IDTFs. The OIG will review services and billing patterns in geographic areas with high concentrations of independent diagnostic testing facilities (IDTF). In areas with a high density of IDTFs, the OIG will examine service profiles, provider profiles, beneficiary profiles, and billing patterns.
Enrollment Standards for IDTFs. The OIG will review IDTFs enrolled in Medicare to determine whether they meet Medicare's enrollment standards.
Physician Reassignment of Benefits. The OIG will review the extent to which Medicare physicians reassign their benefits to other entities. Further, the OIG reports that investigations in South Florida have revealed schemes in which fraudulent providers obtain identifying information about legitimate physicians and request reassignments of their benefits. Therefore, the OIG will examine the extent to which physicians are aware of their reassignments.
Medicare Providers' Compliance With Assignment Rules. The OIG will examine the extent to which providers comply with assignment rules and determine if and to what extent beneficiaries are inappropriately billed in excess of amounts allowed by Medicare requirements. The OIG will also assess beneficiaries' awareness of their rights and responsibilities regarding potential billing violations and Medicare coverage guidelines.
Payment for Services Ordered or Referred by Excluded Providers. The OIG will review the nature and extent of Medicare payments for services ordered or referred by excluded providers. The OIG will also examine CMS oversight mechanisms to identify and prevent improper payments for services based on orders or referrals by excluded providers.
Ambulance Services Used to Transport ESRD Beneficiaries. The OIG will review the extent to which ambulance services are used to transport ESRD beneficiaries to and from dialysis facilities. The OIG will examine factors such as the percentage of the population using ambulance services, the feasibility of contracting by freestanding facilities with ambulance suppliers, and the coverage policies of other health insurance programs.
Medicare Payments for Transforaminal Epidural Injections. The OIG will review Medicare claims to determine the appropriateness of Medicare Part B payment for transforaminal epidural injections. The OIG will determine whether there are policies and safeguards to prevent inappropriate payments for such injections.
Medicare Services Billed With Dates of Service After Beneficiaries' Dates of Death. The OIG will review Medicare claims with dates of service after beneficiaries' dates of death to assess CMS's controls to preclude or identify and recover improper fee-for-service payments.
Comprehensive Error Rate Testing Program. The OIG will review certain aspects of CMS's Comprehensive Error Rate Testing Program (CERT) methodology for determining the 2008 Part A and B error rates (including the transportation/ambulance claims error rate).