OIG report warns of increased hospital upcoding
The report suggests that inappropriate upcoding may have resulted in approximately $10 billion in Medicare overpayments.
Here’s another important reminder for consumers to double-check their EOB and employers to keep a close eye on their claims data: A report out from the HHS Office of Inspector General examining Medicare reimbursements found that hospitals billing at the highest-severity level (and thus higher billing) increased by 20% between 2014 and 2019.
Perhaps patients are suffering from more-severe health events? More likely, the OIG warned, hospitals are increasingly upcoding to increase their reimbursements. Specifically, the report noted that a third of stays lasted a particularly short time and billed for only one qualifying diagnosis, suggesting that the patient was less sick than the billing suggested.
Related: Report: Overbilling and upcoding by hospitals cost Medicare $1 billion
In one example, an individual was coded as having been seen for heart failure and shock with major complication, the average stay for which is for days, but the patient was released after two. The difference between billing at that level and the next-lowest severity level? $2,900.
The OIG report suggests that inappropriate upcoding may have resulted in approximately $10 billion in Medicare overpayments during the study period.
“Oversight is essential to ensuring that Medicare dollars are spent appropriately,” the OIG noted in a press release .”Inpatient hospital billing in the years leading up to the pandemic indicates that some stays at the highest severity level could be susceptible to inappropriate billing.”
The OIG goes on to recommend more-targeted billing reviews by the CMS to identify instances of upcoding, focusing in particular on highest-severity claims, as well as looking through medical records to identify inconsistencies.
Adds the OIG report, “In addition to using the results of the reviews to recoup overpayments, CMS should use them to educate hospitals about appropriate billing, modify coding policies, and consider whether further steps should be taken to disincentivize inappropriate billing.”
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