Cedars-Sinai Medical Center: Audit of Medicare Payments for Bariatric Surgeries

Medicare paid hospitals $372 million for bariatric surgeries provided to Medicare beneficiaries in calendar years 2015 and 2016. Bariatric surgery helps those with morbid obesity to lose weight by making changes to their digestive system. Although OIG has not conducted an audit in this area, the Centers for Medicare & Medicaid Services’ (CMS’s) study of certain bariatric surgery procedure codes found that 98 percent of improper payments lacked sufficient documentation to support the procedures. After analyzing Medicare claim data for bariatric surgery claims with dates of service from January 2015 through December 2016 (audit period), we selected for audit Cedars-Sinai Medical Center (Cedars-Sinai), located in Los Angeles, California. Our objective was to determine whether Cedars-Sinai complied with Medicare requirements and the Medicare contractor’s local coverage determinations (LCDs) and local coverage article (LCA) when billing for bariatric surgeries.Our audit covered $1.3 million in Medicare payments to Cedars-Sinai for 62 bariatric surgery claims. We reviewed the beneficiaries’ medical records to determine whether the claims met Medicare requirements and the specifications in Noridian Healthcare Solutions, LLC’s (Noridian’s) LCDs and LCA for bariatric surgery. An independent medical review contractor reviewed the medical records for 23 claims.