News: Incorrect inpatient, outpatient billing resulted in $1.5 million in overpayments, OIG says

$1.5 million. That’s the amount Alta Bates Summit Medical Center in Oakland, California, incorrectly billed Medicare for inpatient and outpatient services between 2017 and 2019, according to an audit by the Office of Inspector General (OIG), Revenue Cycle Advisor reported. In written comments on the report, Alta Bates Summit Medical Center disagreed with most of the OIG’s findings and recommendations.

The audit focused on 11 risk areas, including billing for inpatient rehabilitation facility (IRF) services and comprehensive error rate testing DRGs, and outpatient reporting of bypass modifiers. The agency reviewed a stratified sample of 85 inpatient and 15 outpatient claims billed to Medicare from January 1, 2017, through December 31, 2018. According to the report, 45 of the 85 reviewed inpatient claims contained billing errors. Specifically:

• 37 claims were for IRF services that did not comply with Medicare documentation requirements
• Four claims were incorrectly coded, resulting in incorrect DRG payments
• Four claims did not meet Medicare criteria for inpatient status

As a result of these errors, the hospital received overpayments of $1,467,725, Revenue Cycle Advisor reported. Based on its sample results, the OIG estimates that the hospital received overpayments of at least $16,395,489 for the audit period.

The OIG recommends that Alta Bates Summit Medical Center refund the estimated overpayments for the audit period for claims that it incorrectly billed.

Editor’s note: This article originally appeared in Revenue Cycle Advisor. ACDIS coverage of other OIG audits can be found here and here.