OIG: Hospitals overbilled Medicare $54.4M for patient transfers

Hospitals used incorrect patient discharge status codes in more than 18,600 claims submitted to Medicare from 2016 through 2018, resulting in $54.4 million in overpayments, according to an audit report from HHS' Office of Inspector General.

The overpayments were the result of the hospitals failing to comply with Medicare's post-acute transfer policy. The hospitals transferred patients to post-acute care facilities, but claimed higher reimbursement associated with other types of discharges.

"Specifically, they coded these claims as discharges to home (16,599 claims) or to certain types of healthcare institutions (2,048 claims), such as facilities that provide custodial care, rather than as transfers to post-acute care," the OIG said.

Based on its findings, the OIG recommended that CMS direct Medicare contractors to recover the $54.4 million in overpayments and identify and recover overpayments for any additional claims for transfers to post-acute facilities in which incorrect patient discharge status codes were used. The OIG also recommended that CMS ensure Medicare contractors are notified of improperly billed claims and take action to initiate recovery of the overpayments.

CMS concurred with the OIG's recommendations and laid out steps it planned to take to address them.

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