OIG Releases its 2013 Work Plan

Health Care News



On October second, the U.S. Department of Health and Human Services Office of Inspector General (OIG) released its Work Plan for fiscal year (FY) 2013, which summarizes OIG’s current and anticipated areas of enforcement, audit and oversight concentration. What follows is a summary of some of the major initiatives contained in the Work Plan.


  • Inpatient Billing for Medicare Beneficiaries
    OIG will review how hospital billing for inpatient stays changed from FY 2008, when the inpatient prospective payment system (PPS) was overhauled, to FY 2012, and how hospitals ensure compliance with Medicare requirements for inpatient billing.

  • Diagnosis-Related Group Window
    OIG will determine how much Medicare could save by bundling payments for pre-admission services delivered up to 14 days prior to admission in a setting owned or operated by the admitting hospital. Presently, payments for pre-admission services up to three days prior to admission (the “diagnosis-related group window”) are not paid separately but are included in the diagnosis-related group payment.

  • Non-Hospital Owned Physician Practices Using Provider-Based Status
    OIG will determine the impact of non-hospital owned physician practices billing Medicare as provider-based physician practices, which can result in additional Medicare payments and increase beneficiaries’ coinsurance liabilities, and to what extent these billing practices meet the requirements of the Centers for Medicare and Medicaid Services (CMS).

  • Compliance with Medicare’s Transfer Policy
    OIG will review Medicare payments made to hospitals for beneficiary discharges that should have been coded as transfers to determine whether such claims were appropriately processed and paid. Furthermore, OIG will examine the effectiveness of the Medicare Administrative Contractors’ claims processing edits used to identify claims subject to the transfer policy.

  • Payments for Discharges to Swing Beds in Other Hospitals
    OIG will review Medicare payments to hospitals for beneficiary discharges that were coded as discharges to a swing bed (an inpatient bed that can be used for acute care or skilled nursing services) in another hospital. OIG may recommend to CMS that Medicare pay hospitals a reduced amount in these cases, as it does when a beneficiary is transferred to another PPS hospital.

  • Payments for Canceled Surgical Procedures
    OIG will examine the costs incurred by Medicare related to inpatient hospital claims for canceled surgical procedures, which according to the OIG’s preliminary analysis, are often followed by a second, higher PPS payment to the same hospitals for the rescheduled surgical procedure.

  • Inpatient Outlier Payments
    OIG will examine trends in outlier payments (supplemental payments from Medicare for patients incurring extraordinarily high costs) and identify characteristics of hospitals with high or increasing rates of outlier payments.

  • Critical Access Hospitals
    OIG will collect information on structures and services of critical access hospitals. To qualify as a critical access hospital, a hospital must meet several criteria, such as being located in a rural area, furnishing 24-hour emergency care, providing no more than 25 inpatient beds, and having an average annual length of stay of 96 hours or less.

Nursing Homes

  • Adverse Events in Post-Acute Care for Medicare Beneficiaries
    OIG will 1) estimate the incidence of adverse events for Medicare beneficiaries receiving post-acute care in skilled nursing facilities and inpatient rehabilitation facilities; 2) identify contributing factors to those events; 3)determine the extent to which those events were preventable; and 4) assess the associated costs to Medicare.


  • Marketing Practices and Financial Relationships with Nursing Facilities
    OIG will review hospices’ marketing practices and financial relationships with nursing facilities, focusing on hospices that have a high percentage of their beneficiaries in nursing facilities.

Home Health Services

  • Face-to-Face Requirement
    OIG will determine the extent to which Home Health Agencies (HHAs) are complying with the Affordable Care Act’s requirement that physicians who certify beneficiaries as eligible for Medicare home health services have face-to-face encounters with the beneficiaries either within 90 days before beneficiaries start home health care or within 30 days after care begins.

  • Employment of Home Health Aides with Criminal Convictions
    OIG will determine the extent to which HHAs are complying with state law requirements that criminal background checks be conducted on HHA applicants and employees.

Medical Equipment and Supplies

  • Accreditation of Medical Equipment Suppliers
    OIG will examine accreditation organizations’ requirements and processes to ensure that medical equipment suppliers meet all of Medicare’s quality standards and will evaluate CMS procedures for surveying accreditation organizations.

Other Providers and Suppliers

  • Anesthesia Services: Payments for Personally Performed Services
    OIG will determine whether Medicare payments for anesthesiologist services reported under the “AA” service code modifier (anesthesia services personally performed), as opposed to the “QK” modifier (anesthesia services medically directed), are properly supported and meet Medicare requirements.

  • Ambulatory Surgical Centers: Payment System
    OIG will review the appropriateness of Medicare’s methodology for establishing ambulatory surgical center (ASC) payment rates under the revised payment system and determine whether a payment disparity exists between ASC and hospital outpatient department (HOPD) payment rates for similar surgical procedures.

  • Ambulatory Surgical Centers and Hospital Outpatient Departments: Safety and Quality of Surgery Procedures
    OIG will compare the safety and quality of care for Medicare beneficiaries having surgeries and procedures in ASCs and HOPDs, considering both the care provided in preparation for and during surgeries as well as the procedures performed in each setting.

  • Part B Imaging Services: Payments for Practice Expenses
    OIG will review Medicare payments for Part B imaging services to determine whether they reflect the expenses incurred and whether the equipment utilization rates (EUR’s) reflect industry practices. This review is significant as an increase in the EUR leads to a corresponding decrease in the reimbursement amount per scan paid by Medicare.

  • Diagnostic Radiology: Medical Necessity of High-Cost Tests
    Because Medicare will not pay for items or services that are not “reasonable and necessary,” OIG will review Medicare payments for high-cost diagnostic radiology tests to determine whether they were medically necessary and the extent to which the same diagnostic tests are ordered for a beneficiary by primary care physicians and physician specialists for the same treatment.

  • End Stage Renal Disease: Medicare’s Oversight of Dialysis Facilities
    OIG will assess Medicare’s oversight of facilities that provide outpatient maintenance dialysis services to Medicare beneficiaries with end stage renal disease (ESRD) as well as the availability and effectiveness of complaint processes at such facilities.

  • End Stage Renal Disease: Bundled Prospective Payment System for Dialysis Services
    CMS established a case-mix adjusted, bundled PPS for renal dialysis services which will be phased in over four years to replace the basic case-mix adjusted composite payment system and the methodologies for reimbursement of separately billable outpatient ESRD services. OIG will review Medicare pricing and utilization related to renal dialysis services under the new bundled PPS for renal dialysis services, including a focus on whether Medicare payments under the new PPS are being made in accordance with Medicare requirements.

  • End Stage Renal Disease: Payments for Drugs Under the Bundled Rate System
    OIG will review payments for ESRD drugs under the new bundled rate system comparing facilities’ acquisition costs for certain drugs to inflation-adjusted cost estimates to determine how costs for the drugs have changed since their last review.

  • Electronic Health Records (EHR)
    OIG will continue to identify fraud and abuse vulnerabilities in electronic health records systems and determine how certified EHR systems address those vulnerabilities.