Medicare Improperly Paid Acute-Care Hospitals an Estimated $190 Million Over 5 Years for Outpatient Services Provided to Hospice Enrollees

Date Issued

Tuesday, November 12, 2024

Submitting OIG

Department of Health & Human Services OIG

Agencies Reviewed/Investigated

Department of Health & Human Services

Report Number

A-09-23-03024

Report Type

Audit

Agency Wide

Yes

Number of Recommendations

Questioned Costs

Funds for Better Use

Report updated under NDAA 5274

External Link

https://oig.hhs.gov/reports/all/2024/medicare-improperly-paid-acute-care-hospit…

Open Recommendations

This report has 6 open recommendations.

Recommendation Number	Significant Recommendation	Recommended Questioned Costs	Recommended Funds for Better Use
25-A-09-011.01	No	$190,110,930	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Improve system edit processes to help reduce improper payments for outpatient services provided by acute-care hospitals to hospice enrollees.
25-A-09-011.02	No	$0	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Educate acute-care hospitals to understand that each hospice enrollee's hospice election statement addendum is available on request, and educate hospices to provide the addendum if requested to help an acute-care hospital assess whether an outpatient service palliated or managed an enrollee's terminal illness and related conditions.
25-A-09-011.03	No	$0	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Continue to educate hospices that they should be providing to enrollees virtually all necessary services that palliate or manage terminal illnesses and related conditions either directly or through arrangements.
25-A-09-011.04	No	$0	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Educate acute-care hospitals to analyze not only whether outpatient services palliated or managed enrollees' terminal illnesses but also whether outpatient services palliated or managed a condition related to a terminal illness.
25-A-09-011.05	No	$0	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Clarify the language in the Manual (chapter 11, section 50), and in other CMS or MAC guidance documents or educational initiatives, if necessary, to specifically mention "related conditions" so that the language is consistent with Federal regulations and the Federal Register in stating that services not related to enrollees' terminal illnesses and related conditions may be billed to Medicare with condition code 07.
25-A-09-011.06	No	$0	$0
We recommend that the Centers for Medicare & Medicaid Services take the following actions, which could have saved Medicare an estimated $190.1 million in payments made to acute-care hospitals for outpatient services provided to hospice enrollees and could have saved enrollees an estimated $43.6 million in deductibles and coinsurance that may have been incorrectly collected from them or from someone on their behalf during our audit period: Direct MACs or other appropriate contractors, such as Recovery Audit Contractors, to: (1) analyze Medicare claims data to identify acute-care hospitals that have aberrant billing patterns for condition code 07, and conduct Targeted Probe and Educate reviews of these acute-care hospitals; and (2) conduct prepayment or postpayment reviews of acute-care hospital claims for outpatient services provided to hospice enrollees and billed with condition code 07.