Medicare overpaid physicians serving in facility settings during a two-year audit period – about $22.5 million more for over a million claims.
That’s according to an audit conducted by the Office of the Inspector General (OIG) and published this week. Generally, Medicare pays practitioners for physician services separately – and a higher amount – compared to payments administered to inpatient facilities, including SNFs and hospitals. Practitioners must put the right code on a Medicare claim to show where they administered services.
The higher, nonfacility rate was paid for services rendered in a facility setting, and the Centers for Medicare & Medicaid Services (CMS) didn’t have system edits to detect these coding errors, OIG found.
The audit was conducted between 2019 and 2020, with 2.1 million physician service claim lines identified as out of compliance with place-of-service policy. Physician services in hospital saw a similar overpayment issue, but not as much at $22.1 million and for fewer claims.
OIG recommended CMS recoup the $22.5 million in overpayments identified in the audit and reach out to physicians who miscoded their services in this way, so they can “exercise reasonable diligence to identify, report and return” overpayments.
It was also suggested that CMS establish and apply Common Working File (CWF) system edits to detect instances where a practitioner incorrectly uses a nonfacility place-of-service code when a patient is in a SNF on Medicare Part A.
In terms of recouping costs, OIG said CMS might even want to seek legislative authority to revise regulations, ensuring Medicare appropriately pays for physician services. However, the agency did not concur with this suggestion.
“CMS has expressed reluctance to take enforcement action for these claim lines because neither statute nor CMS’s regulation specifically addresses situations in which a SNF or hospital inpatient leaves to receive a physician service in a nonfacility setting,” OIG staff said in the audit.
Other suggestions involve developing a mechanism for facilities to indicate when an inpatient leaves a SNF and returns the same day – which CMS also did not concur with – and provide additional education to practitioners on appropriate coding for each care setting.
CMS did agree to consider recommendations involving legislative authority and developing a mechanism for proper coding, and determine if it should take further action on these items. The agency will act on all other OIG recommendations.
