OIG: CMS must fix nursing home billing

The Department of Health & Human Services' Office of the Inspector General (OIG) has urged the Centers for Medicare & Medicaid Services (CMS) to take immediate action on the way skilled nursing facilities (SNFs) bill for concurrent and high-level therapies.

Medicare payment rates for SNF-based therapies rose by 16 percent between the last half of 2010 and the first half of this year, according to an OIG report. That's a $2.1 billion uptick.

CMS had tried to address increases in SNF billing for concurrent therapies by making rule changes the agency believed would cut down on billing for high-level therapies. Instead, billings for those therapies shot up, while charges for less pricey concurrent therapies went down.

As a result, the OIG estimates that CMS will pay SNFs $4 billion more in fiscal 2011 than in fiscal 2010, rendering what had been thought to be a budget-neutral policy change completely ineffective. It insisted CMS to take immediate "corrective action."

The OIG also will perform a full examination of SNF billing at the end of the current fiscal year, and may issue formal recommendations to CMS at that time.

To learn more:
- read the OIG report