On August 24, 2006, the Office of Inspector General (“OIG”) of the United States Department of Health and Human Services (“DHHS”), through its Office of Audit Services, issued a report finding that the Medicare Program overpaid an estimated twenty million dollars for non-physician radiology services provided to hospital inpatients. The estimated overpayments covered the period 2001-2003.

During a Medicare patient’s inpatient hospital stay, the Medicare Program, under Part A, pays the hospital under the Prospective Payment Systems (“PPS”) based on what is known as DRGs. DRG payments include payment for non-physician radiology services. These non-physician services are known as the “technical component” of radiology services. The physician component of radiology services, known as the “professional component”, is billed to the Medicare Program, Part B, by the physician.Continue Reading OIG Estimates $20 Million in Radiology Overpayments

In an August 14, 2006 ruling on a motion in a federal case in Alabama, the district judge allowed the admission of an investigation report created by the Centers for Medicare and Medicaid Services (“CMS”) in an EMTALA action. The lawsuit was brought by a lady who, at 38 weeks of pregnancy, had been involved in an automobile accident. She presented to the hospital emergency department and advised the clerk she was pregnant and was having contractions. She was told that she must wait for the obstetrician on call to decide whether to see her. The patient left the hospital. She filed an EMTALA complaint. CMS investigated the matter and concluded that the hospital had violated federal regulations. The patient also sued the hospital in federal court.
Continue Reading Federal Court Refuses to Apply State Peer Review Privilege in EMTALA Case

The Deficit Reduction Act of 2005 (the “DRA”) mandated that the Centers for Medicare and Medicaid Services (“CMS”) continue to study specialty hospitals and their effect on local community health care delivery. The study was due to be completed by August 8, 2006. However, ranking Senators have asked CMS to collect further data before completing its report. They have expressed concern that the study includes data for states in which specialty hospitals are not allowed to operate and has not included some traditional hospitals that compete directly with specialty hospitals. The DRA permits an extension of the August 8 deadline, however.
Continue Reading Investigation of Specialty Hospitals

Under the Deficit Reduction Act of 2005, acute care hospitals that report certain quality data can receive increased reimbursement rates for inpatient services. The Centers for Medicare and Medicaid Services (“CMS”) recently issued a final rule, on August 1, 2006, permitting acute care hospitals to receive, on average, a 3.5% increase in reimbursement rates for reporting quality data.
Continue Reading Hospital Reimbursement Increases for Reporting Quality Data

The Medicare Modernization Act of 2003 (the “MMA”) requires the Centers for Medicare and Medicaid Services (“CMS”) to enter into contracts with “Part A/Part B Medicare Administrative Contractors” by the year 2011. The contracts with these entities will replace the existing contracts that CMS has with intermediaries for Medicare Part A claims and with carriers for Medicare Part B claims. The new contracts will be awarded to entities on a state-grouped, geographic basis. These entities will be expected to handle both Part A and Part B claims.
Continue Reading First Medicare Administrative Contract Awarded

On April 24, 2006, the Inspector General of the U.S. Department of Health and Human Services (the “IG”), Daniel R. Levinson, issued an open letter to health care providers, focusing specifically on physicians and hospital providers. This letter focuses on potential violations of the Stark and anti-kickback statutes in the context of the hospital-physician relationship. The letter states that several hospital providers are discovering, through their compliance programs, improper financial arrangements under the Stark law, which is a strict liability statute. Stark prohibits the referral of Medicare or Medicaid patients to a hospital by any physician who has a “financial relationship” with the hospital. The financial relationship can take the form of either an ownership interest or a compensation arrangement. There are numerous exceptions to the Stark law’s prohibition, but each element of an exception must be met to avoid the strict liability of the Stark law.
Continue Reading INSPECTOR GENERAL RELEASES OPEN LETTER

In a report issued by the Office of Inspector General (“OIG”) of the United States Department of Health and Human Services (“DHHS”) earlier this year, the OIG suggests that Medicare beneficiaries with certain diseases have experienced higher rates of hospital readmission and more hospital emergency department visits since the implementation of the prospective payment system (“PPS”) as a method of reimbursing home health agencies.
Continue Reading OIG Report Suggests Future Monitoring of Home Health Agency Quality of Care

The Office of Inspector General (“OIG”) of the United States Department of Health and Human Services (“DHHS”) recently issued Advisory Opinion No. 06-01, which opined unfavorably regarding a home health agency’s practice of providing prospective postoperative patients with preoperative home safety assessments.
Continue Reading OIG Issues Unfavorable Advisory Opinion Regarding Home Health Agency Practice