Noridian Healthcare Solutions, LLC, as the Supplemental Medical Review Contractor (SMRC) for the CMS, has conducted post-payment review of claims for Medicare Part A billed on dates of service from January 1, 2017 through December 31, 2017. Below are the review results:

Background

The Office of Inspector General (OIG), under report A-09-14-02037, dated February 2016, found that Medicare paid hospitals $185.9 million for inpatient claims related to bone marrow and stem cell transplant procedures (collectively referred to as “stem cell transplants”). The OIG identified Medicare overpayments to two hospitals that did not always comply with Medicare billing requirements for inpatient claims for stem cell transplants. This resulted in overpayments of approximately $4 million. The lengths of stay for the claims reviewed were one to two days, but generally the lengths of stay for claims for these procedures range from 10 to 21 days. Because claims with these disparities are at risk for billing errors, the OIG reviewed $7.3 million in Medicare payments nationwide for 143 selected inpatient claims for stem cell transplants, from January 2010 through September 2013.

It was found that 133 of the 143 selected inpatient claims did not comply with Medicare billing requirements; the lengths of stay were one to two days. For 120 of those claims, the hospitals incorrectly billed Medicare Part A for beneficiary stays that should have been billed as outpatient, or outpatient with observation services. These claims did not have clinical evidence supporting that an inpatient level of care was required before, during or after the transplant procedure was performed. On the remaining 13 claims, the hospitals billed incorrect Medicare Severity-Diagnosis Related Group (MS-DRGs).

Reason for Review

In response to the OIG report, the CMS tasked Noridian, as the SMRC, to perform data analysis and conduct medical review.  Noridian completed medical record review to determine if providers billed in accordance with statutory, regulatory and subregulatory guidance.

Common Reasons for Denial

• Medical Necessity
  • The documentation received did not support medical necessity for an inpatient stay. CMS Internet-Only Manual (IOM), Publication 100-08, Medicare Program Integrity Manual, Chapter 3, Section 3.6.2.1 outlines that claims shall be denied if the documentation submitted does not support the service was reasonable and necessary. Addtionally, the CMS IOM, Publication 100-02, Medicare Benefit Policy Manual, Chapter 1, Section 10 indicates that a beneficiary is appropriate to be considered an inpatient if there is an “expectation that he or she will require hospital care that is expected to span at least two midnights.” This must be sufficiently documented in the medical records submitted for review.
• No Response to the Documentation Request
  • The documentation was not submitted or not submitted timely. CMS IOM, Publication 100-08, Medicare Program Integrity Manual, Chapter 3, Section 3.2.3.8 requires providers/suppliers to respond to requests for documentation within 45 calendar days of the additional documentation request.
• Signature Requirements Not Met
  • The documentation submitted lacked required signatures. CMS IOM, Publication 100-08, Chapter 3, Medicare Program Integrity Manual, Section 3.3.2.4 requires services be authenticated by the persons responsible for the care of the patient.
• Incorrect Coding
  • The documentation submitted did not support the service billed on the claim. CMS IOM, Publication 100-08, Chapter 3, Medicare Program Integrity Manual, Section 3.6.2.4 indicates that review contractors “shall determine that an item/service is correctly coded.”

References/Resources

• Social Security Act (SSA), Title XVIII, §1862(a)(1)(A). Exclusions from Coverage and Medicare As Secondary Payer
• SSA, Title XVIII, §1879 (a)(1). Limitation on Liability of Beneficiary Where Medicare Claims are Disallowed
• 42 C.F.R. Chapter 4, 412.3. Prospective Payment Systems for Inpatient Hospital Services
• CMS Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual, Chapter 1. Inpatient Hospital Services Covered Under Part A
• CMS IOM, Publication 100-02, Medicare Benefit Policy Manual, Chapter 3. Duration of Covered Inpatient Services
• CMS IOM, Publication 100-03 National Coverage Determination (NCD) Manual, Chapter 1, Section 110.23. Stem Cell Transplantation. Effective 01/27/2016
• CMS IOM, Publication 100-08, Medicare Program Integrity Manual, Chapter 3, Section 3.3.2.4. Signature Requirements
• CMS IOM, Publication 100-08, Medicare Program Integrity Manual, Chapter 6, Section 6.5.3-6.5.9. Medical Review of Inpatient Hospital Claims for Part A Payment
• Office of Inspector General, Report A-09-14-02037, Medicare Did Not Pay Selected Inpatient Claims for Bone Marrow and Stem Cell Transplant Procedures In Accordance With Medicare Requirements

Last Updated Jan 28, 2022