The Latest News

Adds Another $250 Million to Combat Medicare Fraud and Errors

The new health reform legislation signed by President Obama on March 23 (H.R.3590), plus the reconciliation “fixes” enacted on March 25 (H.R. 4872) provide $250 Million of additional funding for Medicare audits and enforcement, create new federal enforcement tools, create a new Stark self-disclosure process, mandate compliance and return of overpaymentsby all providers, and expand the role of Recovery Audit Contractors (RACs) to include pursuit of improper payments in Medicaid claims, for all 50 states.

Council Denies CMS Appeal

The Medicare Appeals Council (Council) disagreed with the Centers for Medicare and Medicaid Services (CMS) when asked by CMS to review and overturn a September 2009 decision by an Administrative Law Judge (ALJ). The case concerns an ALJ decision that agreed with a Demonstration Project RAC to deny Medicare coverage for inpatient hospitalization services as billed in November 2004 by O'Connor Hospital of San Jose, California, based on a lack of medical necessity, but went on to find that the "observation and underlying care" was nevertheless warranted, and therefore such services that were provided (normally only billed under Part B) must be reimbursed by CMS, thereby offsetting some of the overpayment resulting from the inpatient denial (originally billed under Part A).