American Hospital Association calls for end to OIG audits

The American Hospital Association (AHA) called on the U.S. Department of Health and Human Services to cease what it calls "flawed and redundant" audits by its Office of the Inspector General in a letter to HHS Secretary Sylvia Burwell.

Of particular concern to the AHA and its members hospitals are the use of extrapolations as part of the process to audit Medicare overpayments. That involves auditing a small sample of claims data and applying the pattern of overpayments to a much larger universe of claims. The Centers for Medicare & Medicaid Services then refer the extrapolated overpayments to the appropriate Medicare administrative contractor (MAC) for recoupment.

AHA insisted that the overcharges for short hospital stays are inflated because CMS does not apply relevant Medicare Part B payments for outpatient care against those overcharges.

The lobbying group also challenged HHS disqualifying payments because the patient's medical record did not include an admission order signed by a physician. It noted that the agency had not put this requirement in place until October 2013 and that some audits involved Medicare Part A claims predating this change.

"The OIG's approach grossly exaggerates estimated Medicare overpayments, leads to excessive recoveries by Medicare contractors, and otherwise prejudices and burdens hospitals," AHA Executive Vice President Rick Pollack wrote in the letter.

In a June letter to HHS, Pollack also noted that the OIG audits were redundant given that Recovery Audit Contractors, or RACs, already performed similar work.

The HHS has yet to respond to the AHA's two letters, but it has reined in the activities of RACs in recent months. Last fall, it ordered RACs to stop scrutiny of short inpatient stays for 90 days. Earlier this year it extended that moratorium as it sought new contracts with potential RAC auditors. The AHA has also pushed to clear up a two-year backlog of RAC appeals.

To learn more;
- read the AHA's letters (.pdf)

Suggested Articles

Medicaid enrollment churn eased following the rollout of the Affordable Care Act, a new study shows. 

Today’s advances in medicine enable the successful management of diseases for which there were once few effective treatment options—at a high cost.

Color, a precision genomics company, has raised $75 million in a series D funding round led by T. Rowe Funds and Viking Global Investors.