OIG claims NJ hospital overbilled Medicaid by $19M

New Jersey overbilled the Medicaid program by as much as $22 million in 2007, and the hospital responsible for the bulk of overpayments is trying to quickly distance itself from the issue, according to NJ.com.

Jersey City Medical Center (JCMC) apparently overbilled the federal Medicaid Disproportionate Share Hospital (DSH) payment program by $19 million in 2007 due to overstatements of charity care, according to a recent audit by the Department of Health and Human Services' Office of the Inspector General. Three other hospitals in Newark, Perth Amboy and Trenton account for the remainder of the overbilling, according to NJ.com.

Altogether, state regulators authorized as much as $38.8 million in overpayments to JCMC, which is part of the Barnabas Health hospital system.

However, JCMC officials claim the government actually underpaid the facility by $2.5 million, based on recently revised insurance figures from state officials.

Moreover, hospital officials say the issue is between federal and state regulators, and claim the facility itself should not be involved. "Jersey City Medical Center was not doing very well financially," JCMC Chief Financial Officer Paul Goldberg told NJ.com. "The hospital was really trying to turn itself around." He added that the hospital was under different management at the time.

State and federal officials will enter into negotiations on the disputed overbilled amounts, NJSpotlight.com reported.

The government is cutting DHS payments nationwide as part of the Affordable Care Act, under the presumption that millions more Americans will either obtain insurance through state health insurance exchanges or expanded eligibility for the Medicaid program. New Jersey is one of only a handful of states with a Republican governor that decided to expand Medicaid eligibility.

Statewide, New Jersey's hospitals spent nearly $1 billion on charity care in 2012, the most recent year for which figures were available, and up slightly from the 2011 figures. Altogether, the hospitals received a total of $675 million reimbursement from federal and state programs.

To learn more:
- read the NJ.com article
- check out the NJSpotlight.com article
- here's the audit (.pdf)

Related Articles:
NJ hospitals spent $998M on charity care in 2012
New Jersey Gov. Chris Christie backs Medicaid expansion
Bill to require nonprofit, for-profit hospitals same disclosure rules
State plan makes hospital charity care funding more equitable

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