Medicare did not appropriately pay acute-care hospitals any of the $51.6 million for outpatient services that we reviewed. In addition, beneficiaries were held responsible for unnecessary deductibles and coinsurance of $14.4 million paid to the acute-care hospitals for outpatient services. Generally, Medicare should not pay an acute-care hospital for outpatient services provided to an inpatient of another facility, such as a long-term-care hospital. Instead, the services should be provided under arrangements between the two facilities, and Medicare should pay the inpatient facility for all services provided to a beneficiary (as part of the facility’s inpatient payment rate).
Medicare overpaid the acute-care hospitals because the system edits that should have prevented or detected the overpayments were not working properly. If the system edits had been working properly since 2006, Medicare could have saved almost $100 million, and beneficiaries could have saved $28.9 million in deductibles and coinsurance that may have been incorrectly collected from them or someone on their behalf.Read the full report