News: CMS overpaid hospitals $47.8 million for bariatric surgeries, OIG estimates

A recent audit conducted by the Office of Inspector General (OIG) projected that hospitals received $47.8 million in net overpayments from January 2018 through July 2019 for Medicare Part A claims that did not meet national requirements or contractor specifications for bariatric surgery, JustCoding reported.

The OIG reviewed a sample of 120 inpatient claims from January 1, 2018, through July 31, 2019, for which Medicare paid 105 hospitals $1.3 million. The audit specifically covered inpatient claims with:

• Medicare-approved bariatric procedure codes listed in CMS’ Medicare Claims Processing Manual
• Morbid-obesity ICD-10-CM code E66.01 (morbid [severe] obesity due to excess calories)
• MS-DRG codes 619 (Operating room [OR] procedures for obesity with MCC), 620 (OR procedures for obesity with CC), or 621 (OR procedures for obesity without CC/MCC)

In addition, claims selected for review were processed by four Medicare contractors: Noridian, Palmetto, Novitas, and First Coast.

Of the 120 sampled inpatient claims, 86 met National Coverage Determination (NCD) requirements and applicable Medicare contractor eligibility specifications for bariatric surgery. Of the remaining 33 claims with payments totaling $351,038, however, 32 claims met the NCD requirements but not the eligibility specifications, and one claim did not meet the NCD requirements. The primary eligibility specifications that the claims did not meet related to inadequate documentation of participation in a weight management program, evaluation by a physician other than a surgeon, and a mental health evaluation.

On the basis of these findings, the OIG recommends that CMS:

• Determine whether any eligibility specifications in the Medicare contractors’ Local Coverage Determinations (LCD) and articles should be added to the NCD for bariatric surgery and, if so, take the necessary steps to update the NCD
• Educate hospitals on the NCD requirements for bariatric surgeries
• Work with Medicare contractors to review eligibility specifications in Medicare contractors’ bariatric surgery LCDs and determine which, if any, of the specifications should be requirements rather than guidance

CMS did not agree with these recommendations and stated that it will continue monitoring scientific evidence related to bariatric surgery procedures and evaluate whether an update to the NCD is necessary.

Editor’s note: This article originally appeared in JustCoding. For more coverage of current OIG audits, click here.