Coding mistakes made on behalf of physicians and other health providers led to more than $35 million in Medicare overpayments for outpatient drugs, a government watchdog has found.
An audit by the U.S. Department of Health & Human Services Office of Inspector General (OIG) discovered that Medicare contractors in 13 jurisdictions overpaid Medicare Part B providers by $35.8 million between July 2009 and June 2012. Erroneous codes and incorrect units of service submitted on behalf of those providers were the top reasons for the overpayments, according to the OIG report, released July 29.
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Incorrect units of service resulted in net overpayments of $26 million, according to the report. One provider, for instance, administered 6 units of rituximab to a patient and billed for 60 units. The same provider made this type of error on 21 separate occasions leading Medicare contractors to pay $811,562 when they should have paid $67,863. The medications most frequently overpaid because of incorrect units of service were: adenosine, rituximab, infliximab, leuprolide acetate, and bortezomib.
Other common billing mistakes by physicians that resulted in overpayments included, insufficient documentation about patient services, billing for outpatient drugs in which payment was already included in that of a primary procedure, incorrect use of Healthcare Common Procedure Coding System (HCPCS) codes, and billing Medicare for noncovered outpatient drugs.
As of May 4, the Centers for Medicare & Medicaid Services had recovered 63% of the overpayments found in the OIG audit, according to the report. However, the OIG also identified potential overpayments for outpatient drugs that were billed after its audit period. Specifically, officials said Medicare contractors could recover as much as $11.5 million in overpayments if they review outpatient drug payments billed from July 2012 through June 2014.
The OIG recommended that CMS collect the remaining overpayments, conduct reviews on the time period after the initial audit period, continue to educate providers on correct billing of outpatient drugs, and continue to implement line item and date-of-service Medically Unlikely Edits for additional outpatient drugs.
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