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Avoid Paying Back $900K: Prepare Your Rev Cycle for an OIG Audit

Analysis  |  By Amanda Norris  
   February 21, 2022

The OIG plans to target organizations' revenue cycle in audits of severe malnutrition reporting and billing.

The OIG recently announced it will conduct statewide reviews to determine whether hospitals complied with Medicaid billing requirements when assigning severe malnutrition diagnosis codes to inpatient hospital claims.

This comes on the heels of the OIG's previous, 2020 audit report that determined hospital compliance with Medicare billing requirements when assigning diagnosis codes for severe malnutrition.

During that audit, the OIG found that of the 200 claims reviewed, only 27 were correctly coded. The errors identified in the random sample amounted to $914,128 in overpayments.

To avoid a potential run-in with the OIG on this matter, revenue cycle leaders should work with the directors of their clinical documentation integrity and coding departments to ensure that coding guidelines and clinical criteria are being met by their staff.

Department heads should be aware that actively auditing malnutrition diagnoses codes, tightening up coder education, and reviewing clinical criteria and documentation practices with physicians will help circumvent these compliance issues.

Organizations are allowed to bill for treatment of malnutrition based on the severity of the condition (mild, moderate, or severe) and whether it affects patient care.

According to CMS, severe malnutrition is classified as a major complication or comorbidity (MCC). Adding an MCC to a claim can result in an increased payment by causing the claim to be coded in a higher diagnosis-related group.

The OIG expects to release its audit of Medicaid inpatient hospital claims with severe malnutrition in 2023.

Amanda Norris is the Director of Content for HealthLeaders.

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