OIG to Investigate Hospital Payments in 2013

DRG payment effect

The extent to which hospital billing for inpatient stays changed from FY 2008 to FY 2012 under new Medicare diagnostic related group payment rates that took effect in 2008, and how inpatient billing "varied among different types of hospitals and how hospitals ensure compliance with Medicare requirements."

Under Medicare's bundled payment formula, payments for care include costs incurred three days prior to admission. This project will examine whether Medicare could save significant amounts of money if it expanded that window to 14 days prior to inpatient admission.

"Prior OIG work identified improper payments in the DRG window," the work plan says. "OIG work has also concluded that CMS could realize significant savings if the DRG window was expanded from 3 days to 14 days."

Pay for cancelled surgeries

The OIG has evidence of "significant occurrences" of payment to hospitals for patients who were admitted for a scheduled surgical procedure, which was subsequently cancelled.

Sometimes the surgery was rescheduled at the same hospital several days later, but sometimes not.  "For these short-stay claims, few if any inpatient services (i.e. laboratory or diagnostic tests) were provided by the hospitals because the surgical procedure was canceled...Current Medicare policy does not preclude payment for these claims."