The following are interesting examples of non compliant overpayments. For additional case studies and productive recovery types, please contact us.
Charge master audit
In the Northeast, a hospital with a market dominant position and with a 2% annual charge master increase authorization developed new revenue codes for room and board charges and then increased these new room and board charges 2%
quarterly. The result was an effective price increase to the payer of 30% in room and board alone.
Centralized billing function errors resulting in double payment
When providers through affiliation, ownership, or management have an effective local market share greater than 20%, duplicate bills are occasionally submitted and paid for the same patient for the same service. The affiliated, owned, or managed provider bills through a centralized claims processing function using different provider identification numbers (PINs) or tax identification numbers (TINs). Because the hospital uses a different PIN or TIN, the claim appears to the payer as a new bill.
In the Midwest, a hospital separately billed oxygen while the patient was allegedly in the intensive care unit. Upon audit, the patient’s room assignment was reclassified to a routine bed from an intensive care bed; the oxygen charges were also recouped.
Claim line variation resulting in double payment
Few payers have edit screens that detect duplicate claim lines within a claim. Most payers’ edits identify mirror duplicates but not duplicate claim submissions where one or more fields in the second claim have different values than the same field in the first claim submission. Duplicate payments for non-mirror claim submissions occur most often as a result of late bills generally submitted 30 days after the first claim submission.
Many payers unknowingly pay duplicate claims when the billed amount of the resubmitted claim differs from the original claim submission by as little as $1.00 – all other fields are the same. Reasons for these overbilled claims and the resulting overpayments depend upon the payer’s claims processing platform, the provider’s claim preparation and submission practices and, if applicable, the payer/provider agreement.
In the Southeast, a hospital had an ER case rate, inpatient per diem, observation bed hourly rate, and percentage of charge outpatient rate. With the patient originating in the ER, on the same day of service, the patient without moving out of the ER but upon ER triage was then discharged from the ER and registered as an outpatient for both a CT and MRI, discharged as an outpatient and registered as an observation bed patient, and prior to the census taking hour, admitted.
Because the inpatient admission was preceded by an observation bed charges, and all other services were billed separately, the ER and OPT charges (and payments) were not bundled into the inpatient case rate.
Double payments when the revenue and CPT codes are duplicated
Some providers interchangeably use the more global revenue code with the more specific CPT code and erroneously overbill for duplicate claim lines within a claim. There are some revenue codes that specifically describe the service provided and can be matched with the CPT code to determine if the patient received a physically impossible number of the same services on the same day.
Census taking hour overpayments
Since few commercial payers specify the census taking hour, particularly for outpatient services, some hospitals redefine their census taking hour based on the payer and the service provided to the payer’s member. For outpatient surgery services paid on a case rate with reduced payments for the second procedure on the same day, some hospitals, after completion of the first procedure, discharge the patient and then for the second procedure, re-register the patient using the subsequent day’s date.
The bills are submitted separately and since the service appears to have been provided on different days, the hospital or outpatient facility is paid at 100% of the contracted rate for both procedures.