News: Nevada-based hospital overcharged Medicare $23.6 million for rehabilitative services

Sunrise Hospital & Medical Center in Winchester, Nevada, submitted Medicare claims for rehabilitative services that did not comply with Medicare billing requirements, Revenue Cycle Advisor reported. This resultied in an estimated $23.6 million in overpayments submitted over a two-year period, according to an April Office of Inspector General (OIG) report.

To determine whether the hospital complied with Medicare billing requirements for certain rehabilitative services, the OIG reviewed a stratified random sample of 85 inpatient and 15 outpatient claims billed by the hospital under Medicare Part A between January 1, 2017, through December 31, 2018. The audit included several claim types including but not limited to:

• Inpatient claims with comprehensive error rate testing DRG codes
• Inpatient rehabilitation facility claims
• Outpatient claims paid in excess of $25,000
• Outpatient skilled nursing facility consolidated billing

The OIG found that Sunrise Hospital & Medical Center complied with Medicare billing requirements for 46 of the 100 inpatient and outpatient claims reviewed. The hospital did not fully comply with Medicare billing requirements for the remaining 54 claims. Specifically, 50 inpatient claims and four outpatient claims had billing errors, resulting in overpayments of $1,002,049.

The identified billing errors included unreasonable and unnecessary inpatient services because beneficiaries:

• Did not require the active and ongoing therapeutic intervention of multiple therapy disciplines
• Did not require and could not be expected to actively participate in, and benefit from, intensive rehabilitation
• Were not sufficiently stable at the time of admission
• Did not require supervision by a rehabilitation physician

The remaining billing errors were linked to claims incorrectly billed as inpatient, incorrect outlier payments, incorrectly billed outpatient modifiers, and incorrectly billed HCPCS codes, Revenue Cycle Advisor reported.

Based on these findings, the OIG recommends that Sunrise Hospital & Medical Center:

• Refund the $23,606,895 in net estimated overpayments for the audit period
• Identify, report, and return any additional overpayments in accordance with the 60-day rule
• Strengthen controls to ensure proper coding and billing for certain rehabilitative services

Editor’s note: This article was originally published by Revenue Cycle Advisor. Click here to read the CDI Journal edition on CDI expansion into alternate settings.