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OIG urges CMS to take action in light of skilled nursing overpayments

July 12, 2011
by root
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The Office of the Inspector General (OIG) is planning to review SNF billing at the end of the fiscal year and is imploring the Centers for Medicare & Medicaid Services (CMS) to take “immediate action” after Medicare payments increased by $2.1 billion during the first six months of 2011.

In a new report, OIG highlighted CMS’s changes to the prospective payment system at the beginning of the year—changes that were intended to be budget neutral—specifically in how facilities bill for concurrent therapy. “Contrary to CMS's expectations, in the first half of FY 2011, SNFs billed for higher levels of therapy and for very little concurrent therapy,” the OIG wrote, calling the billing patterns that contributed to overpayments “unanticipated.”

The OIG said CMS should adjust payment rates to address overpayments to SNFs and change how SNFs account for group therapy. It also suggested further changes to make Medicare payments “more consistent with beneficiaries' care and resource needs.”

CMS’s expected use of therapy types versus therapy actually billed for during the first half of 2011. Click for larger graph
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