OIG: Medicare lost $22.5M on incorrect place-of-service billing

Medicare overpaid millions of dollars for beneficiaries who were in skilled nursing facilities or hospital inpatients, according to an audit from HHS' Office of Inspector General. 

The audit, published May 30, found Medicare overpaid $22.5 million in 2019 and 2020 for care provided to beneficiaries who were inpatients or facility residents. 

Medicare provides facilities payments for each Medicare beneficiary who is a resident. These providers are then reimbursed a lower "facility" rate for certain services, because they receive payments per beneficiary. 

Higher nonfacility rates are paid when residents receive care at another location. 

The OIG recommends CMS revise its regulations to ensure the agency correctly reimburses physicians, seeking legislative action if necessary. 

"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 [skilled nursing facility] or hospital inpatient leaves to receive a physician service in a nonfacility setting," the audit stated. 

CMS agreed to notify its contractors and work to recover the $22.5 million in overpayments, according to the audit. 

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